Universal Burns Rubber With 'The Fast and the Furious'24 Apr, 2002 By: Holly J. Wagner
Strong sales for the surprise hit The Fast and the Furious helped Vivendi Universal's profits first quarter ended March 31, but not enough to counteract a weak advertising market and raise the sagging bottom line, the company reported today.
”The Fast and the Furious home video release, which has logged over 5.5 million units in consumer sales since its January release, currently holds the record for first-week sales,” the company reported.
Universal Studios achieved 41 pecent revenue growth, 26 percent EBITDA (earnings before interest, taxes, depreciation and amortization) growth and 47 percent operating income growth.
Filmed Entertainment revenue grew 48 percent to 1.2 billion euros in the quarter, which the company attributed to strong releases and strong video and DVD sales. EBITDA was up 22 percent to 185 million euros and operating income increased 36 percent.
Imagine Entertainment and DreamWorks Pictures' A Beautiful Mind, has grossed more than $271 million worldwide to date, the report said, and two ‘B: comedies performed better than expected: Big Fat Liar has taken in $48 million at the U.S. box office to date; and Working Title Films' 40 Days and 40 Nights, a co-production with Miramax, has grossed $97 million worldwide to date.
The 20th anniversary re-release of E.T. The Extra-Terrestrial has earned more than $33 million at the U.S. box office to date, making it the third-highest grossing domestic film of all time, after Titanic and Star Wars.
Vivendi even got a little side benefit from the success of New Line Cinema's The Lord of the Rings, as Vivendi's literary unit, which publishes J.R.R. Tolkien's books, got a nudge from sales of his novels.
“In the Literature group, VUP released successful titles in the youth segment in the U.S. and also continued to post strong sales of the Tolkien books both in the U.S. and France,” the report noted.
With its Canal+ and Internet operations struggling, Vivendi chairman and CEO Jean-Marie Messier named new executives today in an effort to stabilize them.
“Vivendi Universal's 2002 priorities are clear: no significant acquisition activity, an aggressive plan for debt reduction, a clear focus on operations and cash management, a focus on developing new synergies to create greater revenues, and a strategy to mitigate the sources of negative operating free cash flow,” he said “Consistent with our commitment to shareholders and employees, we have recently changed CANAL+ Group's management. We fully understood that this would cause a period of disruption, but we are confident that all of our constituencies will soon recognize that this vital step will create benefits for all.”
The report mentioned Universal's participation in digital distribution and protection ventures but did not elaborate.
“During the quarter, Universal Studios joined the other major studios in forming a new venture to develop industrywide technical standards for the deployment of digital cinema,” the report acknowledged.<