Vivendi raises profit target on strong H1 results

  • Business
  • Thursday, 02 Sep 2010

PARIS: Europe’s largest telecom and entertainment group Vivendi raised its annual profit targets after posting first-half forecast-beating results, boosted by its new Brazilian telecoms unit and video games.

Vivendi, which owns Universal Music Group and pay-TV operator Canal+, also said it would maintain its 2010 dividend at the same level as last year, 1.40 euros per share.

“Vivendi is back to growth in the first half of 2010 and improves its full year outlook,” chief executive Jean-Bernard Levy said.

Vivendi raised its 2010 guidance to an “increase” in earnings before interest, taxes and amortisation, compared with a previous forecast of “slight growth.”

It also gave guidance on its adjusted net income for the first time, forecasting it would rise from 2.59 billion euros in 2009.

First-half operating profit rose 11.9% to 3.24 billion euros, compared with a mean estimate of 3.01 billion in a Reuters poll. Revenue rose 6.1% to 13.98 billion euros, compared with a mean estimate of 13.83 billion in the poll.

French telecom operator SFR, 56% owned by Vivendi and the rest by Vodafone, posted strong results as it trounced competitors France Telecom and Iliad in terms of new client recruitments.

Operating profit at SRF, which accounts for more than half of Vivendi’s revenues and was up 6.6% to 2.11 billion euros, ahead of analysts’ expectations.

Vivendi’s newest acquisition, Brazilian fixed-line telecom operator GVT bought in November 2009, also posted strong growth.

“GVT is, for this year and the future, a strong growth driver and we have increased its investment programme,” Levy said.

He added that Vivendi was raising its annual targets for GVT, SFR’s fixed and broadband business, and video games maker Activision. — Reuters

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