PARIS (AFP) - The French media group Vivendi Universal said that a surging net loss so far this year would give way to better-than-expected adjusted net income for 2004 as a whole.
"Today the reorganization of Vivendi Universal is almost complete. Its financial position is restored," a Vivendi statement quoted chief executive Jean-Rene Fourtou as saying.
He predicted adjusted net income for all of 2004 would come to more than a billion euros (1.22 billion dollars) rather than the 700 million previously projected.
The adjusted figure excludes goodwill amortization, gains or losses on businesses sold and other non-operating and non-recurring items, the group said.
Two years after flirting with bankruptcy, Vivendi still posted a second quarter net loss of 1.852 billion euros, six times larger than the 313-million-euro shortfall in the same period last year.
But the group attributed the result to a forseen charge of 2.105 billion euros incurred in the sale of its entertainment unit Vivendi Universal Entertainment to the US television network NBC.
Operating income in the second quarter rose by 6.6 percent to 888 million euros from the same period one year earlier.
For the first six months of the year Vivendi's net loss nearly tripled to reach 1.858 billion euros from first semester 2003.
But adjusted net earnings in the first six months came to 467 million euros, against a loss of 14 million in the same period of 2003, the company said.
The group predicted net debt would fall below five billion euros by year-end when taking into account proceeds from the sale of its Veolia Environnement stake. Vivendi will be able to sell its remaining 20.4 percent interest in the company in December.
Debt stood at 6.4 billion euros at the end of June, down from 13.7 billion on June 30, 2003.
At the height of its crisis in mid-2002, Vivendi carried debt of around 19 billion euros.
On Tuesday, Vivendi confirmed that its improving financial strength will allow it to consider a dividend payment in 2005.
Cash flow from operations is expected to grow in 2004 on a pro forma basis, while posting a slight year-on-year decline on a reported basis.
For the first half, Vivendi posted operating income of 1.818 billion euros, up from 1.677 billion in first half 2003 on revenues that slipped to 11.391 billion euros from 12.364 billion.
"Our priority is to improve our activities' operating results by focusing on operational management," Fourtou said.
"Vivendi Universal's strategy is to strengthen its position among the European leaders in media and telecoms," he added.
Vivendi Universal shares closed 0.83 percent lower at 21.52 euros in Paris, while the CAC 40 ended off 0.47 percent at 3,708.03 points.
"The first-half results were consistent with expectations, with the increased projections for the year already taken into account," a market analyst said.
In general, analysts sought more details on Vivendi's full-year outlook and and the amount of an eventual dividend.
Fourtou told a press conference the group was not working on any major purchases, but said "we will make some minor or medium-sized acquisitions."
Vivendi grew from what was originally a utility company to rank among global media giants following an ill-timed buying spree that crested with the high-tech wave and left the group beached on its pile of debt.
Fourtou, named in July 2002, has refloated Vivendi by concentrating on the group's profitable telecommunications and media activities.
Vivendi is now studying a plan to modify the ownership structures of its various television assets, a move which it said could see the French group Lagardere take a stake in Vivendi's Canal Plus pay-TV unit.