Universal owner posts record profits, but remains cautious
By CMU Editorial | Published on Friday 2 March 2012
Universal Music owner Vivendi declared a record annual profit of 2.9 billion euros in its latest set of financials, published yesterday, but cautioned investors that the firm now faced a tricky couple of years, mainly because its mobile division was facing increased competition in France. With that in mind, dividend payments were cut, while bosses told shareholders to not expect further growth in profits until 2014.
The company’s particularly good performance in the last year was in no small part down to its booming gaming division Activision Blizzard, and its good fortune was in no small part down to one single game, ‘Call Of Duty: Modern Warfare 3’. That said, even Activision will see job cuts in the coming year as all of Vivendi’s units try to reduce overheads.
Universal Music saw revenues decline 5.7% year on year to 4.2 billion euros, though profits were up 7.6% to 507 million. Vivendi’s music business will also be looking to cut overheads in the coming year, and to offload some periphery assets to help finance Universal’s planned acquisition of the EMI labels.
As previously reported, while Universal hopes to get regulator approval for its EMI bid without being forced to sell off any existing assets, it will nevertheless look into trimming the music company at the edges to raise some extra cash to go towards the £1.9 billion EMI acquisition.
Vivendi bosses said yesterday that they hoped regulator approval for the EMI deal and the offloading of some periphery Universal assets could all be achieved in the second half of 2012.