Tags: EU | France | Earns | Vivendi

Vivendi Trims Loss by 32 Percent on Fewer Charges

Monday, 01 Mar 2010 10:21 AM

 

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Vivendi SA said Monday its net loss narrowed by 32 percent in the fourth quarter due to lower financial charges, even though it made a 550 million euro ($746 million) provision to cover possible fines from a U.S. class action suit brought by shareholders.

The French media and entertainment giant added in a statement that the amount of damages it might have to pay "could differ significantly" from the 550 million euro provision after a jury in the United States said Vivendi lied to the public about its shaky finances.

Vivendi said its net loss in the fourth quarter of last year was 958 million euros ($1.3 billion) compared with 1.4 billion euros a year earlier, thanks to lower financial charges.

The company was found liable for lying about its finances in a January verdict in U.S. District Court in Manhattan.

Vivendi has said it will appeal.

In Monday's statement, chairman Jean-Bernard Levy said Vivendi will "continue to vigorously defend the company and its current shareholders against the unfounded claims we and they are suffering."

Lawyers on both sides said any potential payouts if the appeal fails are more than a year away.

Thousands of investors from the United States, France, England and the Netherlands said Vivendi covered up its troubles in 2001 and 2002 as the one-time public water company grew into a media and communications empire. The company flirted with bankruptcy before reorganizing successfully.

Vivendi's media and entertainment holdings include the world's largest music company, Universal Music Group, and pay television service Canal Plus. It also owns SFR, the French mobile telecommunications operator, and Santa Monica, Calif.-based Activision Blizzard, the video game producer behind titles such as "Call of Duty" and "World of Warcraft."

Last year, Vivendi agreed to sell its 20 percent stake in U.S. media giant NBC Universal for $5.8 billion to General Electric Co. Now, GE and Philadelphia-based Comcast Corp. plan to form a joint venture, with Comcast eventually taking a 51 percent stake in the business.

Vivendi also lbought Brazilian telecom operator GVT last year for 2.8 billion euros.

Vivendi's fourth quarter loss left its net profit for the full year at 830 million euros, down 68 percent from 2.6 billion euros in 2008, due to higher financial charges.

The company's underlying profit, which excludes most non-recurring and non-operating items and is the measure watched most closely by financial analysts, fell 5.5 percent last year to 2.59 billion euros.

Universal Music Group, behind acts such as Black Eyed Peas, Taylor Swift and Lady Gaga, saw earnings and sales slide last year as free music downloads continued to eat into CD sales.

SFR, France's No. 2 mobile operator saw earnings stagnate despite slightly higher revenue last year due to new taxes and lower inter-operator fees. New regulations in some of the operators' biggest markets lowered the fees operators pay one another to send calls over each others' networks.

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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