During the third quarter of 2020, the global economy continued its gradual recovery following a second quarter heavily impacted by the COVID-19 pandemic. The advertising market is picking up, albeit to different degrees depending on the region and sector, even if it remains highly volatile. In these challenging times, Havas Group reported an improvement in the third quarter with organic net revenue(4) growth of -10.4% compared to -18.3% in the second quarter of 2020.
All regions reported improved performances in the third quarter compared to the second quarter of 2020. The North American agencies continued to hold up well, thanks to a resilient market and growth in health and wellness communications. Under the impetus of both the Creative and Media businesses, Europe improved its overall performance; however, the results were contrasting between countries. Both Asia-Pacific and Latin America showed signs of strong recovery over the third quarter.
For the first nine months of 2020, Havas Group reported revenues of EUR1,503 million, down 10.6% compared to the same period in 2019. Net revenues were EUR1,449 million, down 8.8%, and organic growth was -10.9%. Exchange rates had a negative impact of -0.2% and acquisitions contributed +2.3%.
Havas Group is stepping up its efforts, initiated at the outset of the crisis, to adjust its organization and cost structure to limit the impact of falling revenues on EBITA. As a result of this agility, the pay-off from the cost- adjustment plan will enable Havas Group to absorb over half of the decline in its revenues over full-year
2020 (before restructuring charges).
During the third quarter of 2020, Havas made two targeted acquisitions (majority shareholdings): Australian media agency Hyland, and Camp + King, a US West Coast agency widely acclaimed for its creativity.
Editis' revenues for the third quarter of 2020 increased by 10.4%, a performance all the more favorable since revenues were already rising in the same period in 2019 driven by the curriculum reform.
The strength of the market's recovery has helped mitigate much of the negative impact of the containment and closure of a large part of the publishing sector's points of sale on sales. Since June 2020, the market has been growing every month compared to 2019. Revenues for the first nine months of 2020 dropped 4.8% at constant currency and perimeter compared to the same period in 2019. As a reminder, revenues for the months of March, April and May were down approximately 40% compared to the same period in 2019.
The strong performance over recent months is notably due to the success of a number of Editis titles, which are among this autumn's best-sellers across all categories: hardback literature with Ken Follett's last novel, Le Crépuscule et l'Aube (Robert Laffont publishing house, worldwide release) and Marc Lévy's C'est Arrivé la Nuit (Robert Laffont/Vesilio publishing house); cookbooks with the success of the first and second volumes of Fait Maison by Cyril Lignac; non-fiction with Toujours Plus by the two-million subscriber influencer Léna Situations (Robert Laffont publishing house); and the youth segment with the good results of L'agenda Scolaire by Roxane (Solar publishing house).
Several of Editis' autumn releases were selected for prestigious literary awards: La Grâce by Thibault de Montaigu (Plon publishing house) was selected for the Prix de Flore, le Prix des deux Magots and the Prix Interallié; La Chambre des Dupes by Camille Pascal (Plon publishing house) is among the first selected for the Goncourt des lycéens after being in the first selection of the Prix Goncourt; La Chasse aux Âmes by Sophie Blandinières (Plon publishing house) is on the Prix André Malraux selection list. Apeirogon by Colum McCann (Belfond publishing house), Les Graciées by Kiran Millwood Hargrave (Pavillon collection of Robert Laffont publishing house), and Kaspar l'Obscur ou l'Enfant de la Nuit by Hervé Mazurel (La Découverte publishing house) are among the second selected for the Prix Femina; Apeirogon by Colum McCann (Belfond publishing house) is also among the second selected for the Prix Medicis. Glory by Elizabeth Wetmore (Escales publishing house) is among the first selected for the Grand Prix of American literature. La Femme qui Reste by Anne de Rochas (Les Escales publishing house) is on the selection list for the Prix du Premier Roman and Kiese Laymon's Baleze (Les Escales publishing house) is on the America Magazine Prize selection list and is among the 10 titles of its ideal library. Falloujah: ma Campagne Perdue (Steinkis/Les Escales publishing house) is nominated for le Prix Les Inrocks in the comics category.
Finally, Editis remains the leader in the very competitive market of senior-year high school curriculum reform, thanks to its brands Nathan and Bordas.
For the third quarter of 2020, Gameloft's revenues were EUR63 million, up 2.6% (+5.2% at constant currency and perimeter) compared to the same period in 2019. For the first nine months of 2020, Gameloft's revenues were EUR193 million, down 0.7% compared to the same period in 2019. For the first nine months of 2020, Gameloft's sales on OTT platforms (Apple, Google, etc.) increased by 3.6% and accounted for 74% of Gameloft's total sales. Disney Magic Kingdoms, Asphalt 9: Legends, March of Empires, Dragon Mania Legends and Asphalt 8: Airborne were the best-selling titles of the first nine months of 2020, representing 53% of Gameloft's total revenues.
Measures banning or restricting the holding of live shows continue to significantly impact the operations of Vivendi Village. All the Olympia Production and U Live festivals had to be postponed until next year. However, several new initiatives were launched, including Garorock Fête sa rentrée ! held over a day in September with capacity limited to 4,000 people, and J2v, a fully virtual techno music festival to which fans from over 200 countries connected in July. Vivendi Village has implemented significant cost reduction measures while developing future various monetization methods for streaming shows.
For the first nine months of 2020, New Initiatives, which brings together Dailymotion and the GVA entities, recorded revenues of EUR44 million, compared to EUR50 million for the same period in 2019 (-11.4% at constant currency and perimeter compared to the same period in 2019).
For the third quarter of 2020, revenues were EUR16 million, up 3.9% at constant currency and perimeter compared to the same period in 2019.
Over this period, Dailymotion's premium audience grew by 6% compared to the third quarter of 2019. This growth was notably driven by new partnerships with Xiaomi, which now offers Dailymotion videos on its mobile phones, the EPCR (European Professional Club Rugby) as well as EuroLeague basketball in Europe, Sports Illustrated in the United States, AMC Television Network at LATAM, The Star in Malaysia, News Nation in Thailand and Brillio in Indonesia.
For its part, in the third quarter of 2020, GVA notably continued the intensification of its network in Libreville, Lomé and Pointe Noire, as well as the extension of its network in Abidjan and Kigali. At the same time, the high broadband access provider launched new marketing and communication campaigns in Gabon, Congo and Ivory Coast, to continue the good sales performance recorded so far and to support the expected growth in the last quarter of 2020.
Wednesday, March 3, 2021: release of Vivendi's 2020 annual earnings
Thursday, April 22, 2021: release of Vivendi' first quarter 2021 revenues
Tuesday, June 22, 2021: Vivendi's Annual General Shareholders' Meeting
Since 2014, Vivendi has been focused on building a world-class content, media and communications group with European roots. In content creation, Vivendi owns powerful, complementary assets in music (Universal Music Group), movies and series (Canal+ Group), publishing (Editis) and mobile games (Gameloft) which are the most popular forms of entertainment content in the world today. In the distribution market, Vivendi has acquired the Dailymotion platform and repositioned it to create a new digital showcase for its content. The Group has also joined forces with several telecom operators and platforms to maximize the reach of its distribution networks. In communications, through Havas, the Group possesses unique creative expertise in promoting free content and producing short formats, which are increasingly viewed on mobile devices. In addition, through Vivendi Village, the Group explores new forms of business in live entertainment, franchises and ticketing that are complementary to its core activities. Vivendi's various businesses cohesively work together as an integrated industrial group to create greater value. www.vivendi.com
Cautionary Note Regarding Forward-Looking Statements This presentation contains forward-looking statements with respect to Vivendi's financial condition, results of operations, business, strategy, plans, and outlook of Vivendi, including the impact of certain transactions and the payment of dividends and distributions, as well as share repurchases. Although Vivendi believes that such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance. Actual results may differ materially from the forward-looking statements as a result of a number of risks and uncertainties, many of which are outside Vivendi's control, including, but not limited to, the risks related to antitrust and other regulatory approvals as well as any other approvals which may be required in connection with certain transactions and the risks described in the documents of the group filed by Vivendi with the Autorité des Marchés Financiers (French securities regulator) and its press releases, if any, which are also available in English on Vivendi's website (www.vivendi.com).
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