Profit at Vivendi, owner of Universal Music, plunged in the third quarter due to sliding sales of CDs, the dollar’s drop against the euro and a tough comparison to last year, when profits were boosted by sale of a stake in Veolia Environment.
Profit fell to 578 million euros ($847 million) from $2.29 billion in the year-ago period. It was Vivendi’s first profit decline in seven quarters.
Profits also fell slightly using a measure that Vivendi calls adjusted net income, which excludes one-time gains, such as the sale of the Veolia stake, and some costs. Adjusted net income fell 1.4% to $1.06 billion.
Universal Music said profit fell 17%, as music downloads failed to make up for sliding CD sales. Sales in the unit rose 6.8% to $1.7 billion, lifted by the purchase of BMG Music Publishing Group, which Vivendi bought in May.
Vivendi revamped its pay-TV unit in January as Canal Plus combined with smaller competitor Television Par Satellite. In the third quarter, Canal Plus posted a 40% jump in profit to $303 million, boosted by the inclusion of TPS. Vivendi Games, whose World of Warcraft game is played by more than 9 million people worldwide, lifted earnings 71% $60.1 million.
Vivendi’s stake in NBC Universal produced less income due to the falling value of the dollar against the euro.