Earnings: UMG Digital Sales Up 33 Percent, New Streams Offset Physical Drop-Off
This story was written by Robert Andrews.
It predicted a turnaround, and maybe it's coming to pass Universal Music Group posted 3.14 billion ($3.97 billion) revenue in the first nine months of 2008 - that's up 3.5 percent if you rule out currency fluctuations. True, in actual currency, it's 3.8 percent down, but even that's not the kind of chronic showing some of the majors had become used to.
It's not that CDs are enjoying a revival the hike came thanks to growth in music publishing and merchandising after UMG bought BMG Music Publishing and Sanctuary, from increased licensing income via the growing number of music-using services, and from a 33 percent increase in digital sales. All of which "more than offset lower physical sales", parent group Vivendi's earnings said. Earnings before the deduction of interest, tax and amortization expenses were up 21.8 percent to 408 million ($516 million) but was actually dragged down by various restructuring costs. Duffy was a big seller for the label.
More from Vivendi's year-to-date after the jump...
-- Games: The combined Activision (NSDQ: ATVI) Blizzard saw 28.4 percent better income of 919 million ($1.16 billion) (or 42.1 percent at constant currency) as World Of Warcraft grew past 11 million online gaming subscriptions. It also scored hits with Guitar Hero and Call Of Duty 4. The unit was formed in July when Vivendi (EPA: VIV) merged its World Of Warcraft maker Blizzard with Activision, so these results arbitrarily comprise figures both before and after the merger. The integration cost 89 million ($112 million).
-- TV: French operator Canal+ got five percent better sales at 3.39 billion ($4.29 billion) and actually reported higher ad revenue. It added 110,000 subscribers, bringing to global total up to 10.4 million, all helped by its merger of TPS, transition costs for which were 64 million ($81 million).
-- Mobile/broadband: SFR revenue inched up two percent, with mobile up 2.7 percent on strong growth of its Illimythics mobile content offering, which includes music, TV, games, messaging and mobile internet.
Vivendi reaffirmed its 2008 outlook, expecting growth on par with 2007.
By Robert Andrews