Business Briefs

Feb 4, 2002  •  Post A Comment

Vivendi stock drops amid rumors
Investors skeptical of Vivendi Universal Chairman Jean-Marie Messier’s ambitious media expansion plans drove the stock down more than 6 percent. Vivendi Universal denied rumors it will sell its Canal Plus pay TV arm, pointing to potential synergies with the soon-to-merge entertainment assets of USA Networks. While fourth-quarter cash flow fell 16 percent on revenues that were down 11 percent due to continued advertising weakness, many analysts consider USA, which includes USA Network, Sci-Fi Channel, USA Films and Studio USA a good match. The merger is expected to close in April.
USA revenues up, loss widens
USA Networks reported better-than-expected fourth-quarter revenues of $1.03 billion, up 14 percent, and $120 million in cash flow, up 33 percent from a year earlier, although loss from continuing operations widened to $49.4 million, or 13 cents a share. Some analysts raised their 12-months targets for what will be USA Interactive stock, citing “significant upside” to e-transaction businesses such as HSN, Ticketmaster and Hotel Reservations Networks. USA forecasts $607 million in cash flow on $4.6 billion in revenues and is planning $5 billion in acquisitions as part of management’s ambitious five-year growth plan.
AT&T Broadband hit
AT&T Broadband reported lower than expected fourth-quarter cash flow of $544 million on $2.4 billion in revenues due to lower basic subscriber and video revenue, lower advertising revenue and higher program costs. The unit’s operating margin slipped to 22.9 percent, an industry low, from a forecasted 27.8 percent. Adjusted analyst forecasts now call for AT&T Broadband, which is being acquired by Comcast Corp., to generate $2.7 billion in cash flow, up 50 percent, on a 14 percent rise in revenues to $10.5 billion.
AOL’s `highest standards’
Call it fallout from the Enron debacle: AOL Time Warner CEO-elect Dick Parsons has challenged investors and industry analysts to blow the whistle on the world’s largest media company. “If you see us falling short; if you see us managing in a way or communicating in a way that falls short of the highest standards, let us know,” he said during a Jan. 30 earnings call. “I am committed to keeping AOL Time Warner in the forefront of American business, not just in terms of performance, but in terms of reputation.”
RealNetworks passes milestone
RealNetworks says it has surpassed the half-million media paid-subscription milestone. The Seattle-based company, which announces earnings late Tuesday, says its now has more than 250 million unique registered users for its RealPlayer and RealOne Player software, about one-third more than a year ago. The software enables users of personal computers and consumer electronic devices to send and receive audio, video and multimedia services using the Web.