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Vivendi Annual Profit Slumps 94%

2/26/2013 2:49 AM ET

French media and telecommunications giant Vivendi SA (VIVEF.PK,VIV.L) Tuesday reported a sharp decline in profit for 2012, weighed down by items, amid a marginal growth in revenues.

Earnings attributable to the company's shareholders for the year plunged to 164 million euros ($214.2 million) from last year's 2.681 billion euros.

This year's results were hurt by a reserve accrual of 945 million euros regarding Liberty Media Corp. (LSTZA, LMCA) and the impairment of Canal+ France that amounted to 665 million euros.

Vivendi had announced in January that a New York court confirmed a 765 million euros jury verdict rendered against the firm on June 25, 2012, in a lawsuit filed by Liberty Media. The dispute arose out of a commercial transaction between the two firms and the former USA Holdings, Inc. that occurred during 2002.

Vivendi, which bought Liberty Media's stake in USA Holdings, is said to have misled Liberty Media about a liquidity problem at the company, and artificially inflated the value of its shares, which in turn was used to effect the buy.

Adjusted net income for the year was 2.55 billion euros, while it totaled 2.95 billion euros last year.

Revenues edged up to 28.994 billion euros from 28.813 billion euros last year.

For the quarter, net loss attributable to the company's shareholders widened sharply to 1.487 billion euros from last year's 118 million euros. Revenues climbed nearly 6 percent to 8.243 billion euros from 7.783 billion euros in the same quarter of previous year.

Segment-wise, for the year, Activision Blizzard's revenues advanced 9.8 percent to 3.768 billion euros. In North America and Europe combined, Activision Blizzard was the Number 1 console and handheld publisher for 2012 with the Number 1 and Number 3 best-selling franchises, Call of Duty and Skylanders.

Universal Music Group's revenues advanced 8.3 percent to 4.544 billion euros. Excluding revenues from EMI Recorded Music acquired at the end of September 2012, revenues rose 1.6 percent, thanks to growth in recorded music sales in North America and favorable currency movements.

Telecom operator SFR's revenues fell 7.3 percent to 11.288 billion euros, due to the progressive impact of price cuts related to competition and to price cuts imposed by the regulators.

SFR's postpaid mobile customer base increased by 109,000 additions in the fourth quarter. At the end of the year, SFR's postpaid mobile customer base was 16.563 million, stable compared to 2011.

Maroc Telecom group's revenues slid 1.8 percent to 2.689 billion euros, while Brazilian phone operator GVT's revenues increased 18.7 percent to 1.716 billion euros. Television unit Canal+ Group reported a 3.2 percent increase in revenue at 5.013 billion euros.

The company proposed to distribute a cash dividend of 1 euro per share. Due to its strong earnings and cash and short term investments, Activision Blizzard declared a cash dividend of $0.19 per common share.

The stock closed up 3.20 percent on Monday to settle at 15.95 euros.

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by RTT Staff Writer

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