Vivendi Universal yesterday announced record losses of €23.3 billion for 2002 but senior management has expressed confidence that the worst of the crisis is now over.
The loss ranks as the largest in French corporate history, eclipsing the €20.7 billion deficit reported by France Télécom earlier this week. Total revenues rose by 4% to €28.7 billion but Vivendi was forced to write down the value of its assets by €18.4 billion. This is the legacy of the acquisition spree undertaken by Vivendi’s former chief executive Jean-Marie Messier (see
Vivendi Launches Debt Relief Strategy).
Cost cutting and a number of asset sales have enabled the company to reduce its debts to €12.3 billion but Messier’s successor, Jean-René Fourtou, has not ruled out further disposals and admitted that he had met Sumner Redstone, the chairman of Viacom, to discuss the possible sale of US entertainment operations (see Viacom Eyes Up VU Entertainment Division).
Fourtou told analysts that 2003 would be a year of transition and intimated that a full recovery would not be possible until 2004. However, this did not prevent shares falling by 7.5% to €11.5 at the close of trading in Paris.
