Universal Revenues Up 16% After EMI Purchase

The Universal Music Group has enjoyed a strong start to the year following their acquisition of EMI, even while parent company Vivendi was forced to reduce its forecasts.

According to the American Financial Times Universal posted revenues of €2.2 billion (AU$3.26 billion), which is up 16.3 percent on the first half of 2012. Digital sales were the cause of much of the growth, accounting for 53 percent of recorded music sales, up from 47 percent.

However the label's overall EBITA (earnings before the deduction of interest, tax and amortisation) fell 8.3 percent to €143 million (AU$221.8 million). The drop was attributed to the EMI acquisition costs and a competitive first half for music releases.

France-based Vivendi knocked back a $8.5 billion bid for Universal earlier this year, and the company was one of the group's strongest this quarter, with television and telecom assets suffering.

Overall, the group's revenue fell 1.5 percent to €10.8 billion (AU$16 billion), with French telecoms company SFR weighing down profits.

The group sold its stake in video games developer Activision Blizzard earlier this year to reduce debt, but it – and Maroc Telecom, which it also sold out of – were not included in the reports in line with financial rules.

CEO of Vivendi, Jean-François Dubos, said, “Vivendi's subsidiaries are confronted with a challenging economic environment and highly competitive markets.”

Referencing Universal's EMI purchase he continued, “In this context, the Group's media businesses have resisted, benefiting from the first positive impacts of the acquisitions and growth drivers they put in place.”