☛ Want the latest procurement and supply chain news delivered straight to your inbox? Sign up for the Supply Management Daily
5 September 2012 | Anna Reynolds
French media and telecoms company Vivendi has pledged to make cost savings through procurement after reporting €14 billion (£11 billion) of net debt for the first six months of 2012.
Publishing its half-year results, Vivendi announced a 16.6 per cent drop in net income compared with the same period in 2011, and blamed problems in its domestic market on the struggling mobile phone business, SFR.
SFR’s revenues were down 5.9 per cent and it is now preparing an adjustment to its cost structure. SFR aims to achieve annual operating savings of about €500 million (£396 million) by the end of 2014, through cost-effective procurement of equipment and technology. SFR also plans to reduce its spending on marketing, advertising, IT operations and staff.
Vivendi, which owns Activision Blizzard – the video games maker behind Call of Duty and World of Warcraft – and Universal Music Group (UMG), has seen growth from these two companies with UMG reporting an 18.2 per cent increase on 2011, which, according to Vivendi, is driven largely by continued cost management.
Jean-François Dubos, CEO at Vivendi, said at a press conference: “All our businesses are focused on developing solid commercial performances and on continuously adapting their cost bases. We remain totally committed to recreating shareholder value, growing adjusted net income per share and keeping a strong credit rating.”