Vivendi’s Q3 beats expectations on Brazil telecom and gaming

16 Nov 2010

Media, entertainment and telecoms conglomerate Vivendi beat market forecasts in 3Q10 in terms of net income, thanks to strong sales at its gaming unit and Brazilian telecoms division, but reported weaker-than-expected results for French operator SFR. Vivendi’s third-quarter revenue was EUR6.89 billion (USD9.41 billion), compared with the average estimate of EUR6.70 billion in a Reuters poll, while quarterly EBITDA of EUR1.43 billion was also ahead of market forecasts of EUR1.40 billion.

The group’s Brazilian unit Global Village Telecom (GVT), acquired last year, raised its full year forecast for 2010, saying revenue would climb 40% year-on-year and EBITDA would rise 50%. The unit is investing heavily in the expansion and upgrade of its networks in the lucrative economic areas of San Paolo and Rio de Janeiro. It previously forecast EBITDA and revenue growth of 44% and 34%, respectively.

However, Vivendi’s 56% owned French telecoms group SFR posted operating profit below analyst forecasts, despite improving its quarterly revenues. SFR won 35% of new broadband subscribers in the third quarter, versus 33% for France Telecom, but saw EBITDA fall 11% year-on-year to EUR614 million as competition in the mobile sector – which generates the majority of SFR’s profits – declined amid intense competition. Mobile sales for SFR also fell 1% while they remained stable for France Telecom and Bouygues.

Brazil, France, Global Village Telecom (GVT), SFR, Vivendi