Annual report 2014

Section 3 - Cash flow from operations analysis

Financial Report

| Statutory Auditors’ Report on the Consolidated Financial Statements | Consolidated

Financial Statements | Statutory Auditors’ Report on the Financial Statements | Statutory Financial Statements

Section 3

Cash flow from operations analysis

Preliminary comments

The non-GAAP measures cash flow from operations (CFFO), cash flow from operations before capital expenditures (CFFO before capex, net), and

cash flow from operations after interest and taxes (CFAIT) should be considered in addition to, and not as substitutes for, other GAAP measures

of operating and financial performance as presented in the Consolidated Financial Statements and the related notes or as described in the

Financial Report, and Vivendi considers that they are relevant indicators of the group’s operating and financial performance.

In compliance with IFRS 5, GVT (as from the third quarter of 2014), SFR (as from the first quarter of 2014) as well as Maroc Telecom group and

Activision Blizzard (as from the second quarter of 2013) have been reported as discontinued operations. Vivendi deconsolidated SFR, Maroc

Telecom group and Activision Blizzard as from November 27, 2014, May 14, 2014, and October 11, 2013, respectively.

In practice, income and charges from these four businesses have been reported as follows:

–– their contribution until the effective sale, if any, to each line of Vivendi’s Consolidated Statement of Cash Flows has been grouped under the

line “Cash flows from discontinued operations”;

–– in accordance with IFRS 5, these adjustments have been applied to all periods presented to ensure consistency of information; and

–– their cash flow from operations (CFFO), cash flow from operations before capital expenditures (CFFO before capex, net) and cash flow from

operations after interest and income taxes (CFAIT) have been excluded from Vivendi’s CFFO, CFFO before capex, net and CFAIT.

In 2014, cash flow from operations (CFFO) generated by business

segments was €843 million (compared to €894 million in 2013), a

€51 million decrease (-5.8%). Capital expenditures remained stable

at €243 million (compared to €245 million in 2013) and included the

acquisition of set-top boxes by Canal+ Group for €115 million (compared

to €133 million in 2013). Moreover, in 2013, CFFO included dividends

(€54 million) paid by Beats, sold in August 2014. Excluding dividends

received and capital expenditures, net cash provided by operating

activities before income tax paid amounted to €1,079 million (compared

to €1,082 million in 2013).

In 2014, cash flow from operations after interest and income tax paid

(CFAIT) was €421 million (compared to €503 million in 2013), a €82 million

decrease.

Cash payments related to financial activities amounted to €702 million

(compared to €596 million in 2013), a €106 million increase. In 2014,

they primarily included the premium paid (€642 million) related to the

early redemption of bonds following the sale of SFR. In 2013, they mainly

included the premium paid (€182 million) related to the early redemption

of bonds following the sale of 88% of the interest in Activision Blizzard.

Moreover, cash payments related to financial activities included interest

paid, net for €96 million (compared to €266 million in 2013), a decrease

of €170 million, and the results on foreign exchange risk hedging (a

€47 million gain in 2014, compared to a €142 million loss in 2013).

Cash flows related to income taxes were made up of a €280 million

inflow in 2014, compared with €205 million in 2013. These amounts

notably included refunds received by Vivendi SA related to previous

years (€366 million in 2014 with respect to 2011 Consolidated Global

Profit Tax System and €201 million received in 2013 with respect to

2012 Vivendi SA’s Tax Group System). In 2013, the amount of taxes

paid included the additional contribution of 3% on the dividend paid by

Vivendi SA (€40 million).

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Annual Report 2014