French media and telecommunications group Vivendi announced a 5.4% increase in quarterly revenue, buoyed by strong performances from its key subsidiaries Lagardere, Canal+ Group, and Havas. The company, helmed by CEO Arnaud de Puyfontaine and Chairman Yannick Bolloré, revealed a revenue of €4.28 billion ($4.59 billion) for the first quarter of the fiscal year, demonstrating resilience and growth in a challenging economic landscape.
The driving force behind this growth has been the success of its core units, prompting Vivendi to seriously consider a corporate split, a move aimed at unlocking greater value for shareholders. Since the spin-off and listing of Universal Music Group in 2021, Vivendi has grappled with what it terms a "conglomerate discount," limiting its market valuation and hindering potential expansion opportunities for its subsidiaries.
The proposal to split the company into four independent entities, each to be listed separately on the stock market, has been under discussion since late 2023. This move would see Canal+, Havas, and Lagardere, alongside other publishing and distribution assets, operate as distinct entities, while Vivendi would retain its role as a supporting entity for its subsidiaries.
Canal+ Group reported a 4.3% increase in quarterly revenue to €1.54 billion. The growth was propelled by an expanding subscriber base and increased average revenue per user, both domestically and internationally, particularly in Africa.
However, subsidiary StudioCanal witnessed a 13.3% decline in revenue compared to the previous year, attributed to the absence of blockbuster releases like "Alibi.com 2" and "John Wick 4," which boosted earnings in the same period last year. Vivendi remains optimistic about StudioCanal's prospects, anticipating significant film releases later in 2024.
Meanwhile, Vivendi's gaming arm, Gameloft, saw a marginal decline in quarterly revenue, down 3.4% compared to the same period in 2023. The company remains committed to navigating challenges in the gaming industry and exploring avenues for sustained growth.
The proposed restructuring reflects Vivendi's strategic vision to optimize its portfolio and enhance shareholder value. As discussions around the corporate split continue, investors await further details on the potential implications and benefits of this transformative move. With its strong performance in the first quarter, Vivendi is poised to navigate the evolving media landscape and capitalize on emerging opportunities in the global market.
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