Vivendi posts 4.8% rise in profits on pay-TV/games, but price cuts affect SFR

27 Jul 2006

French media and telecoms conglomerate Vivendi reported a 4.8% rise in profits in the three months to 30 June 2006, driven by strong growth from games and pay-TV services, but said its mobile phone unit SFR went into reverse. Vivendi posted revenues of EUR4.84 billion (USD6.1 billion) in the second quarter, compared with EUR4.62 billion a year ago, driven by a 29% rise at its games division and a 14.3% increase in sales at pay-TV business Canal+. By contrast, revenues at the group’s wireless arm and France’s second largest mobile operator, SFR, dipped by 0.4% in the second quarter to EUR2.17 billion, largely the result of a decision by the regulator Arcep to impose price cuts in the segment from 1 January 2006. Excluding the effects of the price cuts, SFR’s revenues would have been up 4.9%, Vivendi said.

SFR ended June with 17.415 million customers, having added 216,000 new users in the period under review, whilst its number of 3G users stood at 1.574 million at the end of June, compared to 1.003 million at the start of the year. Average revenue per user (ARPU) fell by 3.7% from EUR489 in June 2005 to EUR471 a year later. Average voice usage rose by 14.5% to 319 minutes per month while net data revenues improved to represent 13.1% of all network revenues in 1H 2006, compared with 11.4% in 2005.

Vivendi’s Moroccan phone company Maroc Telecom, which reported its results earlier this week, posted a 13.2% year-on-year rise in first half revenues to EUR993 million. Turnover from its fixed and internet businesses were up 7.7% thanks to pricing modifications, the growth of incoming international traffic and strong demand for broadband services. Maroc Telecom had 325,000 ADSL subscribers at the end of the second quarter, a 140.7% rise on a year ago. Mobile turnover was up 18% at EUR634 million thanks to strong subscriber growth which reached 8.924 million by end-June (+24.2% year-on-year). Monthly ARPU stood at EUR10.5.

France, Morocco, Maroc Telecom (IAM), SFR