* CEO says 2009 EBITA growth will top the 4.9 pct of 2008
* 2008 earnings in line with company's guidance
* Canal Plus drops 1 billion-euro EBITA goal for 2010
* Vivendi shares down but outperforming media sector
(Adds CEO comments at news conf, updates shares)
By Dominique Vidalon
PARIS, March 2 Vivendi (VIV.PA) is betting on
its Guitar Hero and World of Warcraft games to boost profits
this year, despite the global economic slump.
Europe's largest entertainment group owns Activision
Blizzard, the world's top video games company.
It also expects to benefit from slight growth at its pay-TV
unit Canal Plus and its telecoms arm SFR. It said restructuring
costs tied to acquisitions would be lower after it posted 2008
earnings in line with expectations.
Despite a solid balance sheet and good cash flow, Vivendi
played down prospects of making acquisitions in the near-term
and notably in Spain, where it has been looking at pay-TV
"We are extremely confident and resilient despite the
current market conditions but also vigilant and we will continue
to monitor costs," Chief Executive Jean-Bernard Levy told a
conference call with journalists.
With 70 percent of revenue coming from phone, Internet,
pay-TV and online video games subscriptions, Vivendi is viewed
as one of the most defensive stocks in the media sector, with a
low exposure to a bleak advertising market, analysts say.
"I would not say that Vivendi is immune to the crisis but
Vivendi suffers less from the crisis than other groups who are
in so-called cyclical sectors," Levy later said.
Vivendi, owner of Universal Music Group, the world's biggest
record company, and French telecom operator SFR, expects EBITA
growth in 2009 to top the 4.9 percent achieved in 2008, Levy
said. He would not provide a revenue target for 2009.
"We expect video games to continue to show a nice growth. We
started the year with 12 million subscribers for World of
Warcraft, which is a good base," he said.
World of Warcraft is a popular multiplayer online
The group said it would propose a 7.7 percent rise in its
2008 dividend to 1.40 euros per share, also in line with
expectations. Vivendi also vowed to continue in 2009 and beyond
its policy to distribute half of net income in dividend.
"The market should be relieved by in-line earnings and a
positive guidance which confirms the defensive profile of the
stock," CM-CIC analysts said in a note.
Vivendi shares were down 0.98 percent at 18.78 euros in
early afternoon trade, with France's benchmark CAC-40 index
.FCHI down 3.25 percent and the European media stocks sector
.SXMP down 2 percent. The company has a market capitalisation
of about 22 billion euros.
CANAL PLUS DROPS 2010 EBITA TARGET
The economic slump and regulatory costs were, however,
expected to limit Canal Plus's growth, with Vivendi predicting
slight revenue growth in 2009 and a 10 percent rise in EBITA.
Vivendi dropped a 1 billion EBITA target for Canal Plus in 2010.
Universal Music, whose artists roster includes Amy Winehouse
and Duffy, was expected to maintain its 2009 EBITA at 2008 level
at current currency.
Meanwhile, SFR was slated for slight revenue growth but a
slight decrease in EBITDA for its fixed line business due to new
taxes and fibre-optic development and a slight decrease in
EBITDA for mobile operations amid a competitive environment.
Asked for an update on the group's plans toward Digital+,
the pay-TV unit of Spanish media group Prisa (PRS.MC), Levy
said: "To date we have no prospects of buying this asset in
Spain, as we could not find a satisfactory agreement."
He would not say if talks still continued on the issue.
Vivendi reported a 4.9 percent rise in 2008 earnings before
tax and amortisation (EBITA) to 4.953 billion euros ($6.28
billion), as the acquisitions of Neuf Cegetel and Activision
helped fuel a 17.2 percent rise in revenue to 25.392 billion.
Net adjusted profit rose 8.4 percent on a like-for-like
basis, in line with the group's guidance for profit growth
similar to the 8.3 percent achieved in 2007.
However, after 245 million euros in costs from the purchase
of fixed-line operator Neuf Cegetel and Activision Blizzard
adjusted net profit fell 3.4 percent to 2.735 billion euros.
(Editing by Rupert Winchester and Andrew Macdonald)