Posts: 254
Threads: 13
Joined: Feb 2003
Vivendi set a new record, declaring a net loss of 23.3 billion Euros in their consolidated 2002 financial results. That is a record loss for a French corporation.
They state in their report that in 2003 they will make a "Determined pursuit of asset disposal", expecting to unload 7 billion Euros in assets in 2003.
I wonder how much of that is Blizzard?
-rcv-
Posts: 2,161
Threads: 100
Joined: Feb 2003
"The chicken is costing us too much in food, we're losing money!"
"Sell the (cash) cow and put more money into the chicken!"
Trade yourself in for the perfect one. No one needs to know that you feel you've been ruined!
Posts: 254
Threads: 13
Joined: Feb 2003
03-07-2003, 02:16 AM
(This post was last modified: 03-07-2003, 02:17 AM by channel1.)
I just got finished skimming through the conference they held today.
Vivendi Universal Games is hardly a "cash cow". It makes money, but not a whole lot. With revenue of E794M, they show an operating income of E63M or 8% operating margin. That's only 1% of their 2002 revenue, and rather low operating margin compared to other divisions within the company (excluding the losers :)
The low margin is to be expected from a business that primarily relies upon retail sales. That's actually what could make it a reasonable target for divestiture, since it could easily take a decade to earn as much as the selling price could be.
On the other hand, it is such a small component of the total operation that they could almost look on it as something that they might as well keep around, since it wouldn't make much difference either way. I don't think that is likely to be the way that they will look at it, though. Their overall strategy seems to be more towards utilities and services.
I imagine that the success, or lack thereof, of online gaming may decide the matter for them, since the monthly subscription service seems to be more in-line with where they want to be. The game division certainly has no long term profitability to support keeping it, since it actually lost money in 2001. A big reason why 2002 was profitable was due to "Lack of restructuring in 2002", and reduced investment in that area.
Heh. I dunno, it doesn't matter a whole lot to me, except that I think it would be nice if someone picked up the game assets who whould light a fire under those guys.
-rcv-
Posts: 828
Threads: 8
Joined: Feb 2003
Quark,Mar 7 2003, 01:43 AM Wrote:"The chicken is costing us too much in food, we're losing money!"
"Sell the (cash) cow and put more money into the chicken!"
They have no choice. No one wants to buy their chicken.
