Vivendi's First Half 2006 Earnings Results

Business Wire, Sept 7, 2006

Income from equity affiliates totaled EUR155 million compared to EUR172 million for the same period in 2005, representing a decrease of EUR17 million. Income from earnings of NBC Universal amounted to EUR157 million for the half-year ended June 30, 2006 compared to EUR188 million for the same period in 2005.

Other financial charges and income generated a EUR519 million loss compared to income of EUR240 million in the half-year ended June 30, 2005, representing a EUR759 million decrease mainly resulting from the capital loss incurred on the PTC shares (EUR -496 million) and the positive impact in 2005 of the unwinding of InterActiveCorp's interest in VUE (EUR194 million).

Provision for income taxes was an income of EUR651 million (compared to a charge of EUR385 million for the same period in 2005). Items included in this amount are the profit related to the settlement of the DuPont litigation (EUR1,019 million) and the tax savings generated by the Consolidated Global Profit Tax System (EUR298 million) (compared to EUR250 million for the same period in 2005).

Adjusted net income attributable to equity holders of the parent represented earnings of EUR1,378 million (basic adjusted net income per share of EUR1.20 and EUR1.19 on a diluted basis), compared to earnings of EUR1,243 million for the half-year ended June 30, 2005 (basic adjusted net income per share of EUR1.08 and EUR1.08 on a diluted basis). For the half-year ended June 30, 2006, the difference between earnings attributable to equity holders of the parent and adjusted net income attributable to equity holders of the parent (EUR -484 million) mainly related to the elimination of the gain generated by the settlement of the tax dispute involving the DuPont shares (EUR921 million) partially offset by the elimination of the capital loss incurred on the PTC shares (EUR -496 million).

Earnings attributable to equity holders of the parent amounted to EUR1,862 million (basic net earnings per share of EUR1.62 and EUR1.60 on a diluted basis), compared to EUR1,257 million for the half-year ended June 30, 2005 (basic net earnings per share of EUR1.10 and EUR1.09 on a diluted basis), representing an increase of 48.1%.

Vivendi's Business Units: Comments on First Half 2006 EBITA

Universal Music Group (UMG)

Universal Music Group's EBITA of EUR295 million was 22.4% above the same period last year (up 20% on a constant currency basis) primarily as the result of the sales volume growth and the recovery of a previously expensed cash deposit of EUR50 million recovered in the TVT lawsuit.

Vivendi Games

Vivendi Games' EBITA of EUR62 million was 226.3% above the same period of the prior year (up 214.6% on a constant currency basis). This significant improvement was driven by growth in revenues, with an increased proportion relating to the higher margin of the World of Warcraft business. EBITA is also impacted by the beginning start up investments for the Sierra Online and Vivendi Games Mobile divisions.

Canal Group

Canal Group's EBITA was EUR190 million. On a comparable basis(4), EBITA was on par compared to the first half of 2005.