Mixed Fortunes For European Media

Havas Losses For 2001 Total £35.3 Million Havas Advertising has this morning announced full-year results for 2001 which revealed losses of £35.3 million including a £42 million goodwill write-down and £63 million in exceptional charges for the year. The group said that the advertising market would remain ‘weak’ in 2002 but anticipates that reorganisation, cost-cuttings and new business wins would allow Havas to quickly reap the benefits of any rebound which may occur.

Publicis Bucks The Trend With 18% Rise In Profits Publicis Groupe SA released full year results yesterday which bucked the industry-wide trend of loss, loss and more loss with profits leaping by 18% for 2001. Publicis is the world’s sixth largest advertising group and controls 75% of the Zenith Optimedia Group which is the world’s third largest buying agency. Publicis CEO Maurice Lévy was equally upbeat about 2002: “Our Group is currently prepared to expand further and we are well positioned as 2002 gets under way. We believe that we will be able to outperform the world market once again this year. And we expect earnings to rise further in 2002.”

Write-Offs Push Vivendi £8.3 Billion Into The Red French media group Vivendi Universal yesterday announced losses of E13.6 billion, largely due to deal-making by Vivendi CEO Jean-Marie Messier in order to build the company into the second largest media group in the world. The deals, made during market peaks over the past 18 months, have resulted in a huge write-off for Vivendi as the value of the deals crumbles in the current market downturn. The largest of the write-downs was E6 billion relating to French pay-tv business Canal+ and E3.1 billion at Universal Music. Other areas adding to the loss were Universal Studios, the company’s internet division and international telecoms.

“Sometimes there is a confusion between write-offs and the creation and destruction of value,” said Vivendi CEO Jean-Marie Messier at a news conference in Paris. “Given that the acquisitions were virtually all paid in shares not cash, this non-cash charge does not represent any value destruction.”

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