Universal Music Group made a significant contribution to parent company's Vivendi Universal's financial results for 2005. UMG's earnings from operations increased to €480 million ($570 million)
Universal Music Group made a significant contribution to parent company's Vivendi Universal's financial results for 2005.
UMG's earnings from operations increased to €480 million ($570 million), up 18.8% from 2004 on a comparable basis and at constant currency.
In a statement, VU today (March 1) said the increase "reflects higher sales volumes, continued cost savings efforts and lower restructuring charges in 2005."
UMG's revenues were up 1.5% over 2004 at €4.89 billion ($5.8 billion). Commented VU, "UMG artists dominated the best seller lists in its major markets, topping all of the major music genres allowing UMG to gain market share, and lead the competition by earning an unprecedented 40 Grammy awards."
Overall, the French media and telecoms group posted net adjusted earnings of €2.08 billion ($2.5 billion) up 55% year-on-year. Total revenues for the group reached €19.4 billion ($23 billion) in 2005, up 6.6% from 2004.
"Our strategy is paying off," said Jean-Bernard Levy, chairman of the management board of Vivendi Universal. "We will continue to invest in creation, content, and in future technologies while fostering loyalty in our subscribers. Vivendi Universal will create value first and foremost by promoting innovation, creativity and operational synergies and by making the appropriate investments at the right time."
Reflecting the company's return to financial strength, Levy said VU will propose to pay a dividend of €1 in 2006, an increase of 67% compared to last year. The group re-introduced the dividend in 2005 after a two-year hiatus, following a near-bankruptcy situation in 2002.
"Good surprise on the dividend, the results are in line with forecasts," one Paris-based analyst told Reuters.
Looking forward to 2006, Levy said, "In the first few months of 2006, we are already seeing encouraging signs and the dynamics in each of our businesses are consistent with 2005. I am therefore confident that 2006 will be a further year of further improved growth and improved profitability, which should lead to an additional increase of next year's dividend."