Vivendi on Wednesday posted a $1.07 billion annual loss for 2022 related to the deconsolidation of its stake in Telecom Italia, but painted a positive picture about overall health and revenue.
The loss was offset by a record profit of $25.9 billion in 2021, fueled by the divestment of a 60 percent stake in Universal Music Group.
Annual sales for the Paris-based global media and entertainment group rose 10.1% year-on-year to $10.1 billion (€9.6 billion). EBITA grew by 35.6% to $915 million (€868 million). Adjusted net income, excluding Telecom Italia, rose 19.4% to $713 million (€677 million).
The group said the rise in revenue was due to the performance of its two biggest units, communications company Havas and pay-TV giant Canal+ Group, and games specialist Gameloft.
“I would like to highlight the solidity of our group with another year of double-digit growth,” CEO Arnaud de Puyfontaine said in a conference call about the results.
“I would like to sincerely thank all my colleagues around the world for this very solid performance. The chapter we wanted to open after the redistribution of the UMG group capital started well. 2022 was a turning point for Vivendi.”
The key to the positive development of Canal+ Group was the growth of its subscriber portfolio, which reached 25.5 million units worldwide at the end of December 2022, compared to 23.7 million at the end of 2021.
The group recorded a net increase in subscribers from 457,000 in France to a total of 9.5 million in the course of 2022.
The total subscriber portfolio outside continental France was 16.0 million subscribers at the end of December 2022, of which 6.3 million were in Europe; 7.6 million in Africa, 1.2 million in Asia-Pacific and another 800,000 in the French overseas territories.
Canal+ Group’s revenue was $6.1 billion (€5.8 billion), an increase of 1.7% compared to 2021. Profitability improved compared to 2021, with EBITA increasing by 7.3% to EUR 515 million has.
International revenue rose 3.5%, driven by subscriber growth (+1.3 million year-on-year).
The revenue of Studiocanal, the film and television production and distribution arm of the Canal+ group, fell by 22.8%.
Vivendi said the drop was due to an exceptional year for TV series in 2021 and delaying the release of international films until 2023 to optimize their box office performance.
The decrease in sales did not affect the unit’s EBITA, which increased compared to 2021.
Studiocanal also grew to become the largest French film distributor in France in 2022, with 8.9 million admissions (corresponding to a gross value of approximately US$63 million), thanks to strong performances by local productions November, Stand up, big who?, Goliath And Waiting for bojangles.
According to Vivendi, the most important developments for the Canal+ Group were the strengthening of its offer at the end of last year with the launch of Paramount+ within the Canal+ offer.
Canal+ is the only platform in France that can include Paramount+ in its commercial offers and is the exclusive distributor of Paramount+ in French-speaking Switzerland. Other streaming services available via bundles on Canal+ are Netflix, Disney+, beIN and OCS.
Other landmark developments for the Canal+ group include the agreed acquisition of pay-TV package OCS from telecommunications group Orange and its film and series co-production subsidiary Orange Studio. A letter of intent for the operation was signed earlier this year.
Another important transaction was the increase of Canal+ Group’s stake to 30.27% in MultiChoice Group, the largest pay-TV operator in Anglo-Portuguese Africa in more than 50 countries.
Vivendi said the move shows confidence in the pay-TV company and the African continent.
Vivendi’s other top-earning subsidiary, communications arm Havas, saw revenue grow 18.1% year-on-year to $2.9 billion.
Vivendi noted that the company has had a solid international acquisition strategy over the past year, acquiring companies in the UK, Australia, China and Spain.
Vivendi also praised the performance of video game specialist Gameloft.
It noted that Gameloft’s revenue for the fourth quarter of 2022 was $111 million (€106 million), up 30.7% from the same period in 2021, and for the first time the symbolic threshold of €100 million (over $105 million ) for a term. .
Total revenue for 2022 also reached a record high of $338 million (€321 million), up 21.2% compared to 2021. EBITA was €12 million, up 46.3% year-on-year.
Vivendi said the growth is the result of a strategic shift to mobile multiplatform games for console computers and the success of Disney Dreamlight Valley, which was developed and published by Gameloft in September 2022.
Vivendi’s main goals for the coming year are to complete the intended acquisition of the French media group Lagardère.
The deal, which started in 2022, is currently in the crosshairs of antitrust authorities in the European Union over concerns about the implications of a merger between Lagardère publishing company Hachette and Vivendi subsidiary Editis.
Vivendi has now indicated that it is prepared to sell Editis to pave the way for the takeover of the much larger media group Lagardère.
De Puyfontaine said he was confident that a solution could be found by early summer. He said Vivendi planned to respond to an appeal from the EU in mid-March and propose “solutions” soon after.
“The European Commission’s decision is expected by the end of May and the end of the procedure in June is based on the agreement on Editis’ future majority shareholder,” he said.
“We have a guideline and a goal and we are obviously working on another possible alternative, taking into account our ultimate goal to obtain the agreement to complete this operation with Groupe Largardère.”
Vivendi also hopes to find a solution for the future of Telecom Italia, where it is the largest shareholder.
Negotiations are currently underway between the government and its various stakeholders on a possible sale of parts of the indebted telecommunications company, including the landline.
“We tried to find a solution,” said de Puyfontaine.
“As you know, Vivendi representatives resigned from their positions on the board in January. For this reason, we stopped the consolidation process of Telecom Italia. This gives Vivendi more freedom to defend its position outside the governing bodies. We remain committed to ensuring that the true value and unique network of this company is properly recognised.”
He said Vivendi’s position on Telecom Italia was to “be a very active shareholder”. He said several scenarios are possible.
As for further mergers and acquisitions, an analyst asked if Vivendi still had plans for a minority stake in Lionsgate’s Starz.
De Puyfontaine said a recent change of course by Lionsgate to sell its studio division meant he could not comment at this stage.
“You have seen that Lionsgate has announced that it intends to sell its studio business and we cannot comment further until the new structures are in place, so I will not comment further on that,” he said.
Source: Deadline
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