Vivendi posts $11.8B loss

March 5, 2002 Posted: 1813 GMT

NEW YORK (CNN) -- Vivendi Universal posted a 2001 non-cash loss of 13.6 billion ($11.8 billion) Tuesday even though earnings before taxes for its core media group jumped 34 percent.

Paris-based Vivendi (V: down $0.57 to $41.12, Research, Estimates) said it took a one-time amortized goodwill charge of nearly 13 billion ($11.3 billion) due to the market drop in its shares in the last two years. That, along with a nearly 1 billion one-time goodwill charge, led Vivendi to take a 15.7 billion ($13.7 billion) charge under French accounting rules that resulted in the 13.6 billion non-cash loss in 2001.

The French media conglomerate reported EBITDA of 5.036 billion ($4.4 billion) and 1.838 billion ($1.6 billion) for its core media group. For the whole company, operating income climbed 47 percent to 3.795 ($3.3 billion) in 2001.

The consensus analysts' forecast for 2001 EBITDA was 8.785 billion for Vivendi's core business and 8.785 billion for the whole group. Profit forecasts vary because of the number of purchases and sales the company has completed in the past year.

Vivendi has been moving away from the French form of accounting to U.S. generally accepted accounting principles (GAAP). Under French rules, Vivendi had debt of 14.6 billion ($12.7 billion) for its media and communications activities. Under U.S. accounting, the company had debt of 19.1 billion ($16.6 billion).

The media conglomerate expects about 10 percent organic growth in its core media group for 2002 and earnings before taxes of 6 billion, a 20 percent gain over 2001.

Vivendi Chairman and CEO Jean-Marie Messier also has come under fire for allowing his company's share price to  plunge 25 percent since the start of 2002, and for a lack of clarity in Vivendi's financial reporting practices.

These concerns, and market jitters over accounting scandals like that involving U.S. energy trader Enron, have helped drive Vivendi's share price down and forced Messier to spend much of his time defending the value of the company.

"The strength of our asset portfolio has been evident in a difficult year, as we did not have a need to issue any profit warnings," Messier said Tuesday