Vivendi Shares Rise on Full-Year, UMG Results
February 15 2019 - 5:24AM
Dow Jones News
By Patrick Costello
Vivendi SA (VIV.FR) shares rose Friday after the company
reported a jump in revenue and pretax earnings in its 2018 results
late Thursday.
Revenue at Vivendi rose 11% on year in 2018 to 13.93 billion
euros ($15.71 billion), while its profitable Universal Music Group
subsidiary grew revenue 10% to EUR6.02 billion.
Earnings before interest and taxes increased to EUR1.18 billion
from EUR1.04 billion, Vivendi said.
At 0936 GMT, Vivendi shares were up 6.8% at EUR24.27. The share
is up 14% on year.
Analysts said that revenue growth at UMG was the highlight of
Vivendi's earnings, particularly in light of Vivendi's plans to
sell up to 50% of its stake in UMG.
While Vivendi's overall results were in line with forecasts,
UMG's revenue growth exceeded expectations and will likely "fuel
enthusiasm" around the sale of the music subsidiary, analysts at
Citi wrote.
Vivendi didn't deliver a concrete update on the sale, but "the
market is excited about the potential for this division," Citi
noted. "Even without concrete progress on the sale process, this
alone will be enough to keep investors upbeat."
Equally as reassuring for investors is Vivendi's announcement to
seek up to a 25% share buyback worth up to EUR8 billion, analysts
at Deutsche Bank said, noting this move is unrelated to the UMG
stake sale.
"Shareholders have been concerned that Vivendi's net cash and
UMG proceeds would be squandered on overpriced and questionable
deals," Deutsche Bank said. "This offers strong rebuttal."
Write to Patrick Costello at patrick.costello@dowjones.com.
(END) Dow Jones Newswires
February 15, 2019 05:09 ET (10:09 GMT)
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