Vivendi Revenue Rises on Growth at Havas, Canal+

Vivendi Revenue Rises on Growth at Havas,  Canal+

French media and telecommunications conglomerate Vivendi reported higher first-half revenue and earnings on Thursday, driven by gains at advertising giant Havas, but also pay TV unit Canal+ Group.

Revenue for the first six months of 2022 reached €4.87 billion ($4.94 billion), up 10.9 percent, or 5.4 percent on an organic basis, which focuses on constant currencies and current assets, compared to the year-ago period. Earnings before interest, taxes and amortization (EBITA) jumped 31.5 percent to €412 million ($418 million), “thanks notably to the contribution of Canal+ Group, the growth of Havas Group and the integration of (French magazine publisher) Prisma Media.”

Vivendi also broke out revenue for the second quarter, which rose 8.6 percent to €2.50 billion, “mainly due to Havas Group’s very good momentum.” Focusing on constant currency and assets, quarterly revenue grew by 3.1 percent, led by Havas, while Canal+ recorded a 1.3 decline on that basis.

“As reflected in the 31.5 percent increase in EBITA, our businesses continued to show very strong resilience in the first half of the year,” said Vivendi CEO Arnaud de Puyfontaine. “Our business model and high-profile brands provide solidity and consistency to our revenues and operating performance, as demonstrated by our financial figures” for the first half of the year.

“These figures are a testament to the effectiveness of the strategy implemented by the group,” said Yannick Bolloré, chairman of Vivendi’s supervisory board. “It is underpinned by the transformation work carried out by each of our businesses to adapt their business models to changes in consumption patterns, the competitive environment, and emerging technologies. We also intend to continue our international development. Havas Group and Canal+ Group already generate 80 percent and 40 percent of their revenues, respectively, outside of France.”

Vivendi said it owned a 57.35 percent economic stake but minority voting stake in French publishing giant Lagardère following a public tender offer that ended in June. Vivendi said on Thursday that it would explore divesting its publishing unit Editis, acquired in 2019, “to avoid any potential antitrust problems.” It added: “Vivendi contemplates carrying out this transaction primarily by distributing Editis shares to Vivendi’s shareholders and simultaneously having the shares admitted to trading on the Euronext Paris stock exchange.”

During an analyst call, Vivendi execs talked about Canal+ being among bidders eyeing a potential stake in Lionsgate’s Starz premium pay TV and streaming platform. CEO de Puyfontaine said the French media giant had successfully taken minority stakes in other global media companies, including holding a 20 percent stake in African pay-TV platform Multichoice.

“The approach is very pragmatic. We’re open to different opportunities. A minority [stake] is not something we wouldn’t contemplate if we are given the rationale and all the elements to believe that it’s a wise investment in the context of our strategy plans,” de Puyfontaine told analysts during an evening call.

First-half revenue at pay TV unit Canal+ rose 2.2 percent when focusing on constant currencies and current assets, or 3.3 percent otherwise, to €2.87 billion ($2.91 billion). International revenue was a key growth driver “thanks to another significant increase in the number of subscribers,” the firm said. StudioCanal’s revenue fell though by 23.5 percent on an organic basis “despite very good performances from its catalogue and cinema film releases,” with the decrease “coming from its TV series after an exceptional first half of 2021 (War of the Worlds, Un Asunto Privado, Dos Vidas).”

Canal+ EBITA of €337 million ($342 million) for the six-month period was up 0.4 percent when looking at constant currency and current assets, or 2.1 percent otherwise.

Meanwhile, ad powerhouse Havas boosted its first-half revenue by 19.9 percent to €1.56 billion ($1.58 billion), while EBITA rose 27.8 percent to €112 million ($114 million) thanks to “the ongoing benefits of the cost adjustment plan, despite a significant increase in personnel costs in the first half of the year,” the firm said.

Vivendi also reported flat second-quarter revenue for game-maker Gameloft to €120 million ($122 million) despite “a mobile video game market that declined by 7 percent in the first half.” It noted “the success of Apple Arcade games and the solid performances of Gameloft for brands (advertising platforms) and Gameloft Business Solutions (telecom operators and handset manufacturers platforms) whose revenues increased by 27.8 percent and 7.5 percent, respectively.”