Blockbusting box-office performances from movies Jurassic Park III, American Pie 2 and The Mummy Returns enabled Vivendi Universal to overcome stalling growth at its music division and reiterate its ambitious revenue growth forecasts for the year.
In a move designed to allay fears that Vivendi's transformation from a water company into a media presence was about to be derailed by a profits warning and accounting fears, chief executive Jean Marie-Messier insisted yesterday that revenues were "in line with management estimates 12 months ago".
His comments, added to an email sent to Vivendi's worldwide staff last week in which he dismissed rumours of a profits warning, helped Vivendi shares rally 3%.
However, the stock has still lost one third of its value since the start of the year as the market takes a tougher line on companies with large debts and investors struggle to keep pace with the performance of a business that has become extremely difficult to analyse following $50bn of deals in the last 18 months.
In the wake of the Enron collapse and renewed fears about accounting, analysts are also nervous about how well Vivendi executes a plan to move to US accounting rules from the less rigorous French model later this year.
Mr Messier said that proforma revenues from the media and communications divisions grew 9% to €28.9bn in the year ending December 31. Analysts at Merrill Lynch estimate group debt is €33bn. Full results, including the contribution from the historical environmental businesses, are due out in March.
Vivendi has been able to grow income ahead of competitors like AOL Time Warner because of its lower dependency on advertising fees, which account for around 5% of group revenues. "The operating management deserves recognition for fulfilling their growth objectives and outperforming their peers in a difficult year," Mr Messier said. Among the strongest performing parts of the business were television, film and telecoms. The blockbusters from Universal Film, acquired in 2000 as part of the takeover of Seagram, and CanalStudio, part of the pay-TV group, lifted divisional revenues 8%.
Telecoms revenue climbed 24% as fixed line division Cegetel grew 61% and mobile operator SFR increased by one fifth.
In common with peers like EMI, music revenues were less impressive. Difficult conditions in the global record market - particularly in Latin America - saw sales slip 1% to €6.5bn. Best selling artists from the Universal Music group included Shaggy and current UK number one Enrique Iglesias.
