Regulatory News:
Vivendi (Paris:VIV):
Note: This press release contains
non audited consolidated earnings established under IFRS, which
were approved by Vivendi’s Management Board on May 5, 2015, and
reviewed by the Audit Committee on May 6, 2015, and by the
Supervisory Board on May 12, 2015.
First quarter 2015Key
figures1
Change year-on-year
Change at constant currency and perimeter2
year-on-year
€2,492M
+7.5%
+2.5%
€117M
+17.1%
- Earnings attributable to Vivendi
shareowners3
€33M
NA4
€218M +7.0%
+3.1%
€218M +17.9%
+14.1%
€136M +24.1%
+€4.6bn5 vs. +€4.6bn as of December 31,
2014
1 In compliance with IFRS 5, SFR and Maroc Telecom (businesses
sold in 2014), as well as GVT (in the process of being sold) have
been reported as discontinued operations. In practice, income and
charges from these businesses have been reported as follow:
- their contribution until the effective
divestiture, if any, to each line of Vivendi’s Consolidated
Statement of Earnings (before non-controlling interests) has been
reported on the line “Earnings from discontinued operations”;
- their share of net income has been
excluded from Vivendi’s adjusted net income.
2 Constant perimeter reflects the following changes made in the
consolidation scope: acquisitions of Mediaserv (on February 13,
2014) and Thema (on October 28, 2014) at Canal+ Group.3 For the
reconciliation of EBIT to EBITA and to income from operations, as
well as of earnings attributable to Vivendi SA shareowners to
adjusted net income, see Appendix V.4 Not comparable due to the
sale of Maroc Telecom and SFR in 2014 (qualified as discontinued
operations in 2014 as per IFRS 5).5 Excluding the partial
redemption by GVT of its loan for €0.3bn, as per IFRS5.
Vivendi's Supervisory Board met today under the chairmanship of
Vincent Bolloré and reviewed the Group’s condensed financial
statements for the first quarter of 2015, which were approved by
the Management Board on May 5, 2015.
Vivendi posted increased operating results for the first quarter
of 2015.
Canal + Group’s operations were supported by the good
performances of its entities outside of France, its free-to-air
channels in France and of Studiocanal. Universal Music Group (UMG)
benefited from the growth in recorded music and music publishing.
At Vivendi Village, Vivendi Ticketing in the United Kingdom and
Wengo registered a very satisfactory first quarter.
In this context, Vivendi‘s income from operations increased by
7.0% (3.1% at constant currency and perimeter) compared to the
first quarter of 2014 thanks to the performance of UMG’s music
repertoire and the transformation plan implemented by
Watchever.
Earnings attributable to Vivendi SA shareowners amounted to €33
million, compared to €431 million for the first quarter of 2014.
This amount included earnings for discontinued operations for €584
million during the first quarter of 2014, compared to €17 million
for the first quarter of 2015. This situation will continue
throughout 2015.
Adjusted net income, representing the economic performance of
business segments, grew 24.1% to €136 million compared to the first
quarter of 2014, thanks to the increase in income from operations,
the increase in income received from investments and the decrease
in interest expense, partially offset by the increase in income tax
expense.
Moreover, Vivendi’s balance sheet is solid. The net cash stood
at €4.6 billion5 as of March 31, 2015.
On April 7, 2015, Vivendi entered into exclusive negotiations
with Orange for the acquisition of an 80% interest in Dailymotion
for €217 million.
On May 6, 2015, the Group completed the sale of its 20% interest
in Numericable-SFR for €3.8 billion. €1.8 billion has already been
received; the remaining balance will be received no later than
April 7, 2016.
Proposed public tender offer on SECP
Given that since 2009, French law permits Vivendi to increase
its interest in Société d’Edition de Canal Plus (SECP), and because
a large number of its shareholders have requested it, today
Vivendi’s Supervisory Board authorized a proposed public tender
offer on SECP, in which Vivendi indirectly controls 48.5% of the
share capital, at a price of €7.60 per share after the payment of a
€0.25 dividend per SECP share on April 29, 2015 (see separate press
release).
Comments on Key Financial Consolidated
Indicators
A/ Analysis of the consolidated income statement
changes
In compliance with IFRS 5, SFR and Maroc Telecom (businesses
sold in 2014) as well as GVT (in the process of being sold), have
been reported as discontinued operations. In practice, income and
charges from these businesses have been reported as follows:
- their contribution until the effective
divestiture, if any, to each line of Vivendi’s Consolidated
Statement of Earnings (before non-controlling interests) has been
reported on the line “Earnings from discontinued operations”;
- their share of net income has been
excluded from Vivendi’s adjusted net income.
Revenues were €2,492 million, compared to
€2,317 million for the first quarter of 2014 (a 7.5% growth,
or +2.5% at constant currency and perimeter2).
EBIT was €117 million, compared to €100 million
for the first quarter of 2014, a 17.1% increase.
Earnings attributable to Vivendi SA shareowners amounted
to €33 million (or €0.02 per share), compared to
€431 million (or €0.32 per share) for the first quarter
of 2014.
- Earnings attributable to Vivendi SA
shareowners for continuing operations, after non-controlling
interests (Canal+ Group, Universal Music Group and Vivendi
Village, as well as Corporate) was a €16 million profit for
the first quarter of 2015, compared to a €10 million loss for
the first quarter of 2014, a €26 million favorable change.
This change primarily reflected the €17 million increase in
EBIT, the €6 million decrease in interest expense and the
€9 million in dividends received from Activision Blizzard,
partially offset by the €9 million increase in income tax
expense.
- Earnings attributable to Vivendi SA
shareowners for discontinued operations, after
non-controlling interests amounted to €17 million for the
first quarter of 2015, compared to €441 million for the same
period in 2014, a €424 million decrease. For the first quarter
of 2014, earnings notably included SFR, Maroc Telecom and GVT’s
contributions, as well as the gain on the change in value of the
remaining interest in Activision Blizzard.
B/ Analysis of adjusted net income changes
As a result of the application of IFRS 5 to SFR, Maroc Telecom
and GVT, the Adjusted Statement of Earnings presents the results of
Canal+ Group, Universal Music Group (UMG) and Vivendi Village’s
activities, as well as Corporate costs.
Income from operations was €218 million, compared to
€204 million for the first quarter of 2014, a 7.0% increase.
At constant currency, income from operations increased by
€8 million (+4.0%) and primarily reflected the improved
operating performance of Vivendi Village (+€24 million),
thanks to the cost management at Watchever since the second half of
2014, and of Universal Music Group (+€17 million), mainly
attributable to strong recorded music sales.
EBITA was €218 million, compared to
€185 million for the first quarter of 2014, a 17.9% increase.
At constant currency, EBITA increased by 15.1% (+14.1% at constant
currency and perimeter). Restructuring charges, incurred by
Universal Music Group, amounted to €7 million, compared to
€6 million for the first quarter of 2014. The change in EBITA
primarily reflected the increase in income from operations.
Interest was an expense of €5 million, compared to
€11 million for the first quarter of 2014, a 56.4% improvement
thanks in particular to lower interest expenses on bonds partially
offset by lower income received from financings granted to SFR.
Income taxes in adjusted net income were a net charge of
€61 million, compared to €40 million for the first
quarter of 2014. The effective tax rate reported to adjusted net
income was at 27.6%.
Adjusted net income attributable to non-controlling
interests remained stable at €19 million and included
non-controlling interests of Société d’Edition de Canal Plus,
Canal+ Overseas and nc+.
Adjusted net income was €136 million (or €0.10 per
share), compared to €109 million for the first quarter of 2014
(€0.08 per share), a 24.1% increase. This increase
resulted from the increase in EBITA (+€33 million), the
decrease in interest expense (+€6 million) and dividends
received from Activision Blizzard (+€9 million), partially
offset by the increase in income tax expense
(-€21 million).
Comments on Business Highlights
Canal+ Group
Canal+ Group’s revenues amounted to €1,370 million, a 4.0%
increase (+2.5% at constant currency and perimeter) compared to the
first quarter of 2014.
Canal+ Group had a total of 15.2 million subscriptions, an
increase of 605,000 year-on-year, thanks to the strong performance
of Canal+ in Africa and Vietnam, and Canalplay in mainland
France.
Revenues from pay-TV operations in mainland France were nearly
stable year-on-year, in a difficult economic environment.
International pay-TV revenues were up 13.9% compared to the first
quarter of 2014, thanks to the continuous growth of the subscriber
base.
Advertising revenues from free-to-air channels benefited from
growing audience ratings at D8 and i>Télé.
Studiocanal’s revenues grew significantly thanks to successful
theatrical releases, including Paddington, Imitation Game and Shaun
the sheep.
Canal+ Group’s EBITA was €165 million, compared to €175 million
for the first quarter of 2014. This change resulted from an
increased investment in sport content (exclusive Eurosport channel
on Canalsat and secured rights to the National French Rugby
Championship’s “TOP 14” on Canal+), partially offset by a favorable
effect related to the release schedule of the French soccer league
1 and by the favorable outcome of a tax litigation during the first
quarter of 2014.
Income from operations was €154 million, compared to €179
million for the first quarter of 2014.
On March 16, 2015, Canal+ Group jointly announced with ITI Group
the sale of their controlling interest in TVN, Poland’s leading
private media company, to Scripps Networks Interactive Inc.
Universal Music Group
Universal Music Group’s (UMG) revenues were €1,097 million, up
2.3% at constant currency and perimeter (+11.6% at actual currency)
compared to the first quarter of 2014, driven by growth in both
recorded music and music publishing.
Recorded music revenues grew 2.4% at constant currency and
perimeter thanks to strong new release and carryover sales. Growth
in subscription and streaming revenues more than offset the decline
in both digital download sales and physical sales. Music publishing
revenues grew 3.0% at constant currency and perimeter, also driven
by increasing subscription and streaming revenues.
Recorded music best sellers for the first quarter of 2015
included the Fifty Shades of Grey soundtrack, strong carryover
sales from Taylor Swift and Sam Smith and new releases from Drake,
Madonna and Kendrick Lamar.
UMG’s EBITA was €82 million, up 39.3% at constant currency and
perimeter (+45.6% at actual currency) compared to the first quarter
of 2014. The favorable performance reflected the benefit of both
revenue growth and mix, as the continued transition to digital
sales, improved licensing income and a lower proportion of sales
from distributed repertoire all helped margins.
UMG’s income from operations was €88 million, up 26.1% at
constant currency and perimeter (+32.8% at actual currency)
compared to the first quarter of 2014 after adjusting out higher
restructuring and integration charges in the first quarter of
2014.
Vivendi Village
Vivendi Village’s revenues were €25 million, mainly driven by
the growth in operations at Vivendi Ticketing and at Wengo, an
online personal consulting services marketplace.
Vivendi Ticketing’s revenues grew 6.6% compared to the first
quarter of 2014. This growth was mainly driven by See Tickets in
the United Kingdom. Among the platforms managed by Wengo,
RDVmedicaux.com stood out with a strong increase in traffic (x4)
during the quarter.
Vivendi Village’s EBITA, like the income from operations, both
of which amounted to €4 million, turned positive during the first
quarter of 2015 thanks to the transformation plan implemented by
the subscription video-on-demand service, Watchever.
In March 2015, Watchever entered into a distribution agreement
with Telefonica and its brand O2 to market its services in
Germany.
Discontinued operation: GVT
GVT’s revenues were €458 million, a 10.1% increase at constant
currency compared to the first quarter of 2014. This performance
was driven by continuous growth of the core segment (retail and
SME), which increased by 10.7% at constant currency year-on-year;
including a 39.2% increase in pay-TV revenues. This service, which
now represents 15.9% of GVT’s total revenues, had 912,570 pay-TV
subscribers, reflecting a 28.6% increase compared to the first
quarter of 2014.
GVT’s EBITDA was €180 million, an 11.3% increase at constant
currency compared to the first quarter of 2014. Its EBITDA margin
reached 39.3% (39.9% for its telecom activities alone), which is
the highest margin in the Brazilian telecom operator market.
The completion of the GVT sale is expected to occur at the end
of May 2015.
For additional information, please refer to the “Financial
Report and Unaudited Condensed Financial Statements for the first
quarter ended March 31, 2015”, which will be released later online
on Vivendi’s website (www.vivendi.com).
About Vivendi
Vivendi groups together leaders in content and media. Canal+
Group is the French leader in pay-TV, also operating in
French-speaking Africa, Poland and Vietnam; its subsidiary
Studiocanal is a leading European player in production,
acquisition, distribution and international film and TV series
sales. Universal Music Group is the world leader in music. Vivendi
Village brings together Vivendi Ticketing, Wengo (expert
counseling), Watchever (subscription video-on-demand) and the
Paris-based concert hall L’Olympia. In addition, Vivendi currently
owns GVT a fixed very high-speed broadband, fixed-line telephony
and pay-TV services operator in Brazil.
www.vivendi.com
Important Disclaimers
Cautionary Note Regarding Forward Looking Statements. This press
release contains forward-looking statements with respect to the
financial condition, results of operations, business, strategy,
plans and outlook of Vivendi, including the impact of certain
transactions and the payment of dividends and distributions as well
as share repurchases. Although Vivendi believes that such
forward-looking statements are based on reasonable assumptions,
such statements are not guarantees of future performance. Actual
results may differ materially from the forward-looking statements
as a result of a number of risks and uncertainties, many of which
are outside our control, including but not limited to the risks
related to antitrust and other regulatory approvals as well as any
other approvals which may be required in connection with certain
transactions and the risks described in the documents Vivendi filed
with the Autorité des Marchés Financiers (French securities
regulator), which are also available in English on Vivendi's
website (www.vivendi.com). Investors and security holders may
obtain a free copy of documents filed by Vivendi with the Autorité
des Marchés Financiers at www.amf-france.org, or directly from
Vivendi. Accordingly, we caution you against relying on forward
looking statements. These forward-looking statements are made as of
the date of this press release and Vivendi disclaims any intention
or obligation to provide, update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise.
Unsponsored ADRs. Vivendi does not sponsor an American
Depositary Receipt (ADR) facility in respect of its shares. Any ADR
facility currently in existence is “unsponsored” and has no ties
whatsoever to Vivendi. Vivendi disclaims any liability in respect
of any such facility.
ANALYST CONFERENCE CALL (in English, with French
translation)
SpeakersArnaud de Puyfontaine, Chief Executive
Officer and Chairman of the Management BoardHervé Philippe,
Member of the Management Board and Chief Financial Officer
Date: May 12, 20156:00 pm Paris time – 5:00 pm London
time – 12:00 pm New York time
Media invited on a listen-only basis.
Internet: The conference can be followed on the Internet
at: www.vivendi.com (audiocast)
Numbers to dial:United Kingdom: +44 (0) 203 427 19 18 -
code 625 70 92United States of America: +1 646 254 33 65 – code 625
70 92France: +33 (0) 176 77 22 22 – code: 260 96 80
Numbers for replay:United Kingdom: +44 (0) 203 427 05 98
– code 625 70 92United States of America: +1 347 366 9565 – code
625 70 92France: +33 (0) 174 20 28 00 – code: 260 96 80
On our website www.vivendi.com will be available dial-in
numbers for the conference call and for replay (14 days), an audio
webcast and the slides of the presentation.
APPENDIX
IVIVENDICONSOLIDATED STATEMENT OF
EARNINGS(IFRS, unaudited)
1st Quarter 2015 1st
Quarter 2014 % Change
Revenues 2,492
2,317 + 7.5 % Cost of revenues (1,510 ) (1,448
) Selling, general and administrative expenses excluding
amortization of intangible assets acquired through business
combinations (757 ) (678 ) Restructuring charges (7 ) (6 )
Amortization of intangible assets acquired through business
combinations (98 ) (83 ) Other income 1 - Other
charges (4 ) (2 )
EBIT 117 100
+ 17.1 % Income from equity affiliates (6 ) (6
) Interest (5 ) (11 ) Income from investments 9 -
Other financial income 12 3 Other financial charges
(18 ) (15 )
Earnings from continuing operations
before provision for income taxes 109 71 +
53.3 % Provision for income taxes (76 ) (67 )
Earnings from continuing operations 33
4 Earnings from discontinued operations 17 584
Earnings 50 588 Non-controlling
interests (17 ) (157 )
Earnings attributable to
Vivendi SA shareowners 33 431 of
which earnings from continuing operations attributable to Vivendi
SA shareowners 16 (10 ) Earnings
attributable to Vivendi SA shareowners per share - basic 0.02 0.32
Earnings attributable to Vivendi SA shareowners per share - diluted
0.02 0.32
In millions of euros, per share amounts in
euros.
Nota:
In compliance with IFRS 5, SFR and Maroc Telecom (businesses
sold in 2014), as well as GVT (in the process of being sold) have
been reported as discontinued operations.
In practice, income and charges from these three businesses have
been reported as follows:
- their contribution until the effective
divestiture, if any, to each line of Vivendi’s Consolidated
Statement of Earnings (before non-controlling interests) has been
grouped under the line “Earnings from discontinued operations”;
and
- their share of net income has been
excluded from Vivendi’s adjusted net income.
For any additional information, please refer to “Financial
Report and Unaudited Condensed Financial Statements for the first
quarter ended March 31, 2015”, which will be released online later
on Vivendi’s website (www.vivendi.com).
APPENDIX
IIVIVENDIADJUSTED STATEMENT OF EARNINGS(IFRS,
unaudited)
1st Quarter 2015 1st
Quarter 2014 % Change
Revenues 2,492
2,317 + 7.5 % Income from operations
(IFO) 218 204 + 7.0 %
EBITA 218 185 + 17.9 %
Income from equity affiliates (6 ) (6 ) Interest (5 ) (11 )
Income from investments 9 - Adjusted earnings
from continuing operations before provision for income taxes 216
168 + 28.5 % Provision for income taxes (61 ) (40 )
Adjusted net income before non-controlling interests 155 128
+ 20.8 % Non-controlling interests (19 ) (19 )
Adjusted net income 136 109 +
24.1 % Adjusted net income per share - basic 0.10
0.08 + 22.9 % Adjusted net income per share - diluted 0.10 0.08 +
23.2 %
In millions of euros, per share amounts in
euros.
The reconciliation of EBIT to EBITA (adjusted earnings before
interest and income taxes) and to income from operations, as well
as of earnings attributable to Vivendi SA shareowners to adjusted
net income is presented in the Appendix V.
Nota:
According to the application of IFRS 5 to SFR and Maroc Telecom
(businesses sold in 2014), as well as GVT (in the process of being
sold), the Adjusted Statement of Earnings presents the results of
Canal+ Group, Universal Music Group and Vivendi Village’s
operations, as well as Corporate costs.
APPENDIX
IIIVIVENDIREVENUES, INCOME FROM OPERATIONS (IFO) AND
EBITA BY BUSINESS SEGMENT(IFRS, unaudited)
1st Quarter ended March 31, (in millions of
euros) 2015 2014 % Change % Change at constant
currency % Change at constant currency and perimeter (a)
Revenues Canal+ Group 1,370 1,317 +4.0 % +3.6 % +2.5
% Universal Music Group 1,097 984 +11.6 % +2.0 % +2.3 % Vivendi
Village 25 21
Elimination of intersegment transactions - (5 )
Total Vivendi
2,492 2,317 +7.5 %
+3.2 % +2.5 % Income from
operations (IFO) Canal+ Group 154 179 -14.1 % -14.7 % -15.7 %
Universal Music Group 88 66 +32.8 % +25.2 % +26.1 % Vivendi Village
4 (20 ) Corporate (28 ) (21 )
Total Vivendi 218 204
+7.0 % +4.0 % +3.1 %
EBITA Canal+ Group 165 175 -5.6 % -6.2 % -7.3
% Universal Music Group 82 56 +45.6 % +38.1 % +39.3 % Vivendi
Village 4 (20 )
Corporate (33 ) (26 )
Total Vivendi 218
185 +17.9 % +15.1
% +14.1 %
Reconciliations of EBIT to EBITA and to income from operations,
as well as of earnings attributable to Vivendi SA shareowners to
adjusted net income are presented in Appendix V.
a. Constant perimeter reflects the following changes made in
consolidation scope:
- acquisitions of Mediaserv (on February
13, 2014) and Thema (on October 28, 2014) at Canal+ Group;
- managerial transfer of The Olympia
music hall from UMG to Vivendi Village (on January 1, 2015).
APPENDIX
IVVIVENDICONSOLIDATED STATEMENT OF FINANCIAL
POSITION(IFRS, unaudited)
(in millions of euros) March 31, 2015
December 31, 2014 (unaudited)
ASSETS Goodwill
9,898 9,329 Non-current content assets 2,668 2,550 Other intangible
assets 225 229 Property, plant and equipment 718 717 Investments in
equity affiliates 313 306 Non-current financial assets 6,290 6,144
Deferred tax assets 716 710
Non-current assets
20,828 19,985 Inventories 123
114 Current tax receivables 554 234 Current content assets 1,024
1,135 Trade accounts receivable and other 1,906 1,983 Current
financial assets 242 49 Cash and cash equivalents 6,931
6,845
10,780 10,360 Assets of discontinued
businesses 5,193 5,393
Current assets
15,973 15,753 TOTAL ASSETS
36,801 35,738 EQUITY AND
LIABILITIES Share capital 7,442 7,434 Additional paid-in
capital 5,152 5,160 Treasury shares (1 ) (1 ) Retained earnings and
other 10,631 10,013
Vivendi SA shareowners'
equity 23,224 22,606 Non-controlling interests
403 382
Total equity 23,627
22,988 Non-current provisions 2,865 2,888 Long-term
borrowings and other financial liabilities 2,079 2,074 Deferred tax
liabilities 702 657 Other non-current liabilities 116 121
Non-current liabilities 5,762 5,740
Current provisions 267 290 Short-term borrowings and other
financial liabilities 215 273 Trade accounts payable and other
5,440 5,306 Current tax payables 153 47
6,075
5,916 Liabilities associated with assets of discontinued
businesses 1,337 1,094
Current liabilities
7,412 7,010 Total liabilities
13,174 12,750 TOTAL EQUITY AND
LIABILITIES 36,801 35,738
VIVENDIRECONCILIATION OF NON-GAAP
MEASURES IN STATEMENT OF EARNINGS(IFRS, unaudited)
Income from operations (IFO), adjusted earnings before interest
and income taxes (EBITA), and adjusted net income, non-GAAP
measures, should be considered in addition to, and not as a
substitute for, other GAAP measures of operating and financial
performance and Vivendi considers that they are relevant indicators
to assess the group’s operating and financial performance. Vivendi
Management uses income from operations, EBITA and adjusted net
income for reporting, management and planning purposes because they
better illustrate the underlying performance of continuing
operations by excluding most non-recurring and non-operating
items.
1st Quarter ended March 31, (in millions of euros)
2015 2014
EBIT (a) 117 100
Adjustments Amortization of intangible assets acquired through
business combinations 98 83 Impairment losses on intangible assets
acquired through business combinations (a) - - Other income (a) (1
) - Other charges (a) 4 2
EBITA 218
185 Adjustments Restructuring charges 7 6 Charges related to
equity-settled share-based compensation plans 2 8 Other non-current
operating charges and income (9 ) 5
Income from operations
(IFO) 218 204 1st Quarter
ended March 31, (in millions of euros) 2015 2014
Earnings attributable to Vivendi SA shareowners (a)
33 431 Adjustments Amortization of intangible assets
acquired through business combinations 98 83 Other income (a) (1 )
- Other charges (a) 4 2 Other financial income (a) (12 ) (3 ) Other
financial charges (a) 18 15 Earnings from discontinued operations
(a) (17 ) (584 ) Change in deferred tax asset related to Vivendi
SA's French Tax Group and to the Consolidated Global Profit Tax
Systems 44 49 Non-recurring items related to provision for income
taxes 2 5 Provision for income taxes on adjustments (31 ) (27 )
Non-controlling interests on adjustments (2 ) 138
Adjusted net income 136 109
a. As reported in the Consolidated Statement of Earnings.
VivendiMediaParisJean-Louis Erneux, +33 (0)1 71 71
15 84Solange Maulini, +33 (0) 1 71 71 11 73orNew
York(Kekst)Jim Fingeroth, +1-212-521-4819Dawn Dover),
+1-212-521-4817orLondon(StockWell)Tim Burt, +44 20 7240
2486orInvestor RelationsParisLaurent Mairot, +33 (0)
1 71 71 35 13Chi-Chung Lo, +33 (0) 1 71 71 11 88
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