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Section 2 - Earnings analysis
Financial Report
| Statutory Auditors’ Report on the Consolidated Financial Statements | Consolidated
Financial Statements | Statutory Auditors’ Report on the Financial Statements | Statutory Financial Statements
2.2. Earnings review
Earnings attributable to Vivendi SA shareowners analysis
In 2014,
earnings attributable to Vivendi SA shareowners
amounted
to €4,744 million (or €3.52 per share), compared to €1,967 million
(or €1.48 per share) in 2013, a €2,777 million increase (×2.4). This
change notably included the capital gains on the divestitures of SFR
(€2,378 million), Maroc Telecom (€786 million), Beats (€179 million) and
half of the remaining interest in Activision Blizzard (€84 million), as well
as conversely, premium paid (€642 million) on the early redemption of
bonds following the sale of SFR.
Earnings attributable to Vivendi SA shareowners for continuing
operations, after non-controlling interests
(Canal+ Group, Universal
Music Group and Vivendi Village, as well as Corporate) was negative
at €290 million in 2014, compared to a €43 million gain in 2013, an
unfavorable change of €333 million. The €99 million increase in EBIT,
notably included the capital gain on the divestiture of Beats (€179 million),
as well as the decrease in interest expense (+€170 million) more than
offset by the increase in premium paid on the early redemption of bonds
(€642 million in 2014 following the sale of SFR, compared to €182 million
in 2013 following the sale of 88% of the interest in Activision Blizzard)
and by the income tax expense (-€147 million).
Earnings attributable to Vivendi SA shareowners for discontinued
operations,
after non-controlling interest
(SFR, Maroc Telecom,
Activision Blizzard, and GVT), amounted to €5,034 million in 2014,
compared to €1,924 million in 2013, a €3,110 million increase. In 2014,
the amount notably included the capital gains on the divestitures of
SFR (€2,378 million) and Maroc Telecom (€786 million) as well as
the capital gain on the divestiture of half of the remaining interest in
Activision Blizzard (€84 million). In 2013, the amount notably included
the capital gain on the sale of 88% of the interest in Activision Blizzard
(€2,915 million), as well as, conversely, the impairment of SFR’s goodwill
(-€2,431 million).
Adjusted net income analysis
In 2014,
adjusted net income
was €626 million (or €0.46 per share
(1)
)
compared to €454 million in 2013 (€0.34 per share), a €172 million
increase (+37.9%). As a reminder, according to the application of IFRS 5
to SFR, Maroc Telecom, Activision Blizzard, and GVT, the Adjusted
Statement of Earnings presents the results of Canal+ Group, Universal
Music Group (UMG) and Vivendi Village’s activities, as well as Corporate
costs. The increase in adjusted net income notably resulted from:
p
p
a decrease in interest expense (+€170 million);
p
p
an increase in EBITA (+€44 million);
p
p
a decrease in the share of adjusted net income attributable
to non-controlling interests (+€48 million); and
p
p
a decrease in income from equity affiliates (+€3 million);
partially offset by:
p
p
a decrease in income from investments (-€63 million); and
p
p
an increase in income tax expense (-€30 million).
(1)
For the details of adjusted net income per share, please refer to Appendix 1 to this Financial Report.
Detailed analysis of the main items from the Statement of Earnings
Revenues
were €10,089 million, compared to €10,252 million in 2013
(-1.6%, or -1.4% at constant currency and perimeter
(2)
). For a breakdown
of revenues by business segment, please refer to Section 4 of this
Financial Report.
Cost of revenues
amounted to €6,121 million, compared to
€6,097 million in 2013.
Margin from operations
decreased by €187 million to €3,968 million,
compared to €4,155 million in 2013 (-4.5%).
Selling, general and administrative expenses
, excluding
the amortization of intangible assets acquired through business
combinations, amounted to €2,811 million, compared to €3,008 million in
2013, a €197 million decrease (-6.5%).
Depreciation and amortization of tangible and intangible
assets
are included either in the cost of revenues or in selling,
general and administrative expenses. Depreciation and amortization,
excluding amortization of intangible assets acquired through business
combinations, were stable at €307 million (compared to €310 million in
2013), and were notably related to Canal+ Group’s set-top boxes, as well
as Studiocanal’s catalogs, films, and television programs.
EBITA
was €999 million, compared to €955 million in 2013, a €44 million
increase (+4.6%). At constant currency, EBITA increased by €46 million
(+4.8%). At constant currency and perimeter, EBITA increased by
€74 million (+8.1%). This change primarily reflected the increase in
Universal Music Group’s EBITA (+€58 million at constant currency),
notably due to the decrease in restructuring and integration costs
(-€78 million). For a breakdown of EBITA by business segment, please
refer to Section 4 of this Financial Report.
(2)
Constant perimeter reflects the following changes made in the consolidation scope:
–
at Canal+ Group: it excludes the impact in 2014 of the acquisitions of Red Production Company (November 22, 2013), of Mediaserv (February 13, 2014) and of Thema (October 28, 2014); and
–
at UMG: it excludes the impacts in 2013 of operating the Parlophone Label Group repertoire.
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