Release Date: July 25, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Vivendi SE (VVVNF, Financial) reported excellent revenues of EUR9 billion, up 5.8% at constant currency and perimeter.
- EBITA increased significantly by 13.5% at constant currency and perimeter, showcasing strong operational performance.
- Canal+ expanded its international presence by increasing its stake in Viu and launching a mandatory offer for MultiChoice Group shares.
- Havas launched a new strategic plan named Converged, involving a EUR400 million investment in technology, data, and AI over the next four years.
- Lagardère Group posted double-digit growth, with strong performance in its Travel Retail and Publishing divisions.
Negative Points
- Net earnings group shares decreased by 8.3% to EUR159 million, mainly due to a EUR95 million settlement of a 24-year-old litigation.
- Vivendi SE (VVVNF) experienced a sharp deterioration in organic growth at Havas between Q1 and Q2, partly due to the partial loss of a major client in the US.
- The net debt increased from EUR2.8 billion to EUR3.9 billion, driven by investments in MultiChoice, Viaplay, and Viu, as well as share buybacks.
- Gameloft's performance was negatively impacted by restructuring costs and seasonality, with most profits expected in the second half.
- The share price decreased due to market reactions to Universal Music Group's Q2 results, despite a 20% increase since the split project announcement in December.
Q & A Highlights
Q: Can you discuss the tax implications for Vivendi shareholders of the split?
A: The tax impact for shareholders will be lower than the UMG operation two years ago. More than 50% of the distribution will come from share capital and won't be taxed, while less than 50% will come from reserves and will be taxed at a rate of around 30%.
Q: What is the impact of the negative arbitration on VAT and the discontinuation of French football rights for Canal+?
A: Discussions with the French tax authority are ongoing, and the decision is not final. Canal+ is confident it will convince the tax authority that it operates a TV operation, which should be taxed at a 10% rate.
Q: There was a sharp deterioration in organic growth between Q1 and Q2 at Havas. What are your expectations for the second half?
A: The partial loss of a big client in the US impacted organic growth. Havas has adapted its cost structure and expects to increase margins and figures growth by the end of the year.
Q: What are the plans for Canal+ following the nonrenewal of the DTT license for C8?
A: The situation is still being assessed. The team at Canal+ is working on it, and more details will be provided in due time.
Q: Should we expect a similar boost to reported revenues from M&A and ForEx in the second half for Havas?
A: Yes, Havas aims to complete roughly 10 acquisitions for the year, maintaining a similar trend to the first half.
Q: What are your expectations for Lagardère in the second half of the year?
A: There is a confident sentiment regarding Lagardère's performance in the second half.
Q: Could you provide more details on the subscriber base decline for Canal+ in H1?
A: The decline is due to seasonality and the write-off of accounts with very low ARUP. The trend in France is positive, with an increase in the subscriber base.
Q: What is the situation with beIN's retention of French football rights and Canal+'s exposure?
A: Canal+ has a distribution agreement with beIN until May 2025. The impact of beIN's agreement with DAZN is still under discussion.
Q: What is the timeline for the potential split of Vivendi?
A: The split could be implemented by mid-December, subject to employee body approvals and a final agreement from the supervisory board. An Extraordinary General Meeting could be held in early December.
Q: Can you provide more color on the offer for MultiChoice and its relation to the listing of Canal+?
A: The current offer is EUR125 million in cash. There is an option for a combination of stock and cash post-listing of Canal+, but this is not part of the current proposal.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
