Vivendi’s (VIVEF) Q3 2016 Earnings Call

posted in: Earnings Call, Notes | 0

Herve Philippe – CFO

Negative Currency effect expected

“With regard to currency changes, I’ve already mentioned during the presentation of our Q1 and H1 results, while we add a positive FX impact in Q1. These trends reverted in Q2 and in Q3. In Q3, the most noticeable change was increasingly negative impact of the pound down 8.4% on average for the first nine months compared to a negative impact of 4.1% for the first six months…We expect to continue to experience negative ForEx impact over the remainder of the year.”

Increased streaming and subscription services will reduce seasonality effects

“Universal Music’s streaming and subscription revenues increased by 64% more than offsetting the steep decline of 29% in download revenues and a 16% in physical sales. Streaming and subscription operation, our largest source of revenue, now accounted for approximately two-thirds of the digital revenues and more than one-third of recording revenues. The trend towards retail consumption and streaming and subscription services could lead to a lower seasonality effect than in the past. The impact of which may be evident as soon as the fourth quarter of 2016.”

Arnaud de Puyfontaine

On music streaming services

“as regard to the music, we expect some seasonality to occur in quarter four, but due to the shape of the new business, we should expect, nevertheless, the moves linked to season to be lesser than they used to be in the past…if you’ve got a greater chunk of your sales in streaming, those revenues are spread on a 12-month basis on an even basis, in terms of organic, because very frequently you’ve got quite a loyal clients and when you start to use the streaming as subscription experience, you’ve got your play list, you’ve got your – all your library et cetera, so you remain loyal.”