Vivendi Profit Rises 12% on Cost Cutting

Vivendi Universal said Tuesday that second-quarter net income rose 12% as it cut costs in the music and video game units.

Net income rose to 758 million euros ($932 million), or 66 cents a share, from 678 million euros, or 59 cents, a year earlier, Vivendi said. The Paris-based company said it would beat its forecast for 2005 earnings, excluding some costs, of at least 1.8 billion euros.

All five of Vivendi’s units, including pay-TV company Canal Plus and Vivendi Universal Games, “remain profitable in the second half,” Chief Executive Jean-Bernard Levy said.

Vivendi’s wireless unit SFR added clients in the expanding French mobile-phone market, while the music and game units cut costs by eliminating jobs.

Vivendi already has reported that sales in the quarter rose 8%, helped by new albums from artists including rapper 50 Cent, more mobile-phone clients and players of the World of Warcraft online computer game.

Vivendi is focusing on music, mobile-phone services and games after Chairman Jean-Rene Fourtou sold assets valued at 22 billion euros to cut debt and restore the company to profitability.

Fourtou replaced Jean-Marie Messier as chief executive in 2002. Fourtou passed the CEO job to Levy in April.