Vivendi reports loss, but sees better days ahead

PARIS – French media giant Vivendi Universal yesterday reported a surge in its net loss so far this year but forecast a sharp turnaround in its finances for all of 2004.

“The restructuring of Vivendi Universal is today practically complete,” declared group chief executive Jean-Rene Fourtou. He predicted that adjusted net income for all of 2004 would come to more than a billion euros rather than the 700 million previously projected.Vivendi Universal earlier reported a second quarter net loss of 1,852 billion euros (N$15,2 billion), six times larger than the 313-million-euro shortfall in the same period last year.But the group attributed the result to an expected charge of 2,105 billion euros incurred in the sale of its entertainment unit Vivendi Universal Entertainment to the US television network NBC.Operating income in the second quarter rose by 6,6 per cent to 888 million euros from the same period one year earlier.For the first six months of the year Vivendi’s net loss nearly tripled to reach 1,858 billion euros from first semester 2003.But adjusted net earnings in the first six months came to 467 million euros, compared with a loss of 14 million in the same period of 2003, the company said.The group also predicted that its net debt would fall below five billion euros by the end of this year when taking into account proceeds from the sale of its Veolia Environment stake.Vivendi will be able to sell its remaining 20,4 per cent interest in the company in December.Debt stood at 6,4 billion euros at the end of June, down from 13,7 billion on June 30 2003.Vivendi in addition confirmed that its improving financial strength will allow it to consider a dividend payment in 2005.Cash flow from operations is still expected to grow in 2004 on a proforma basis, while posting a slight year-on-year decline on a reported basis.For the first half, Vivendi posted operating income of 1,818 billion euros, up from 1,677 billion in first half 2003 on revenues that slipped to 11,391 billion euros from 12,364 billion.”Our priority is to improve our activities’ operating results by focusing on operational management,” said Fourtou, adding that Vivendi’s financial position has been “restored” after the the company flirted with bankruptcy just two years ago.For the Canal Plus Group and Universal Music activities, Fourtou said efforts to improve profitability were on track, adding that a new management team had been appointed for its loss-making video games division.Canal Plus group posted a second quarter operating profit of 133 million euros, up from a pro forma 87 million on sales that fell to 916 million from 974 million.Universal Music reported operating profit of 31 million euros in the second quarter, up from a loss of 14 million last year.At Vivendi Universal Games, the second quarter operating loss widened to 111 million euros from 28 million.For SFR-Cegetel, operating profits climbed 22 per cent to 634 million euros on revenues that increased 12 per cent in the quarter to 2,055 billion euros.-Nampa-AFPHe predicted that adjusted net income for all of 2004 would come to more than a billion euros rather than the 700 million previously projected.Vivendi Universal earlier reported a second quarter net loss of 1,852 billion euros (N$15,2 billion), six times larger than the 313-million-euro shortfall in the same period last year.But the group attributed the result to an expected charge of 2,105 billion euros incurred in the sale of its entertainment unit Vivendi Universal Entertainment to the US television network NBC.Operating income in the second quarter rose by 6,6 per cent to 888 million euros from the same period one year earlier.For the first six months of the year Vivendi’s net loss nearly tripled to reach 1,858 billion euros from first semester 2003.But adjusted net earnings in the first six months came to 467 million euros, compared with a loss of 14 million in the same period of 2003, the company said.The group also predicted that its net debt would fall below five billion euros by the end of this year when taking into account proceeds from the sale of its Veolia Environment stake.Vivendi will be able to sell its remaining 20,4 per cent interest in the company in December.Debt stood at 6,4 billion euros at the end of June, down from 13,7 billion on June 30 2003.Vivendi in addition confirmed that its improving financial strength will allow it to consider a dividend payment in 2005.Cash flow from operations is still expected to grow in 2004 on a proforma basis, while posting a slight year-on-year decline on a reported basis.For the first half, Vivendi posted operating income of 1,818 billion euros, up from 1,677 billion in first half 2003 on revenues that slipped to 11,391 billion euros from 12,364 billion.”Our priority is to improve our activities’ operating results by focusing on operational management,” said Fourtou, adding that Vivendi’s financial position has been “restored” after the the company flirted with bankruptcy just two years ago.For the Canal Plus Group and Universal Music activities, Fourtou said efforts to improve profitability were on track, adding that a new management team had been appointed for its loss-making video games division.Canal Plus group posted a second quarter operating profit of 133 million euros, up from a pro forma 87 million on sales that fell to 916 million from 974 million.Universal Music reported operating profit of 31 million euros in the second quarter, up from a loss of 14 million last year.At Vivendi Universal Games, the second quarter operating loss widened to 111 million euros from 28 million.For SFR-Cegetel, operating profits climbed 22 per cent to 634 million euros on revenues that increased 12 per cent in the quarter to 2,055 billion euros.-Nampa-AFP