Slide 1: 2002: A Difficult Year, 2003: A Year of Transition
2002: A Difficult Year 2003: A Year of Transition and Financial and Economic Progress
Slide 2: Important Legal Disclaimer
Important Legal Disclaimer This presentation contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are not guarantees of future performance. Actual results may differ materially from the forward-looking
Slide 3: Jean Rene Fourtou, Chairman & CEO
Jean Rene Fourtou Chairman & CEO
Slide 4: Key Performance Indicators
Key Performance Indicators Pro Forma 2002 Pro Forma 2001 2.6 1.2 Cash flow from operations** 0.7 0.0 Proportionate cash flow from operations** (23,3) (13,6) - - Reported Net income / (loss) 37.1 - - Consolidated 12.3 21.4 - - Excluding Vivendi Environnement (applicable for 2001 only) 2002 2001 Net d
Slide 5: Significant Accomplishments
Significant Accomplishments Overcome the liquidity issue; Consolidated Net Debt reduced from &128; 37.1 billion to &128; 12.3 billion*; &128; 8.2 billion of asset divestitures finalized in second half of 2002, including &128; 6.8 billion closed by year end Strengthened control of Cegetel; Cash flow
Slide 6: 2002 Full Year Operating Results
2002 Full Year Operating Results Jacques Espinasse S.E.V.P & Chief Financial Officer
Slide 7: 2002 Consolidated Income Statement
2002 Consolidated Income Statement Full Year ended December 31 2002 Illustration VE Equity Accounting* Revenue Operating Income interest expense, net other financial (expense) / income financial provisions exceptional items, net income tax expense income (loss) before equity interest, goodwill amort
Slide 8: 2002 Goodwill and Non-Recurring Items
Actual results impacted by goodwill and non-recurring items 2002 Goodwill and Non-Recurring Items French GAAP - -23.0 0.2 - -22.8 TOTAL 0.6 0.0 0.6 Minority interest effect Tax on capital gains, reversal of deferred tax, provision for tax risk - -1.0 0.0 - -1.0 Tax effect Gains and losses on BSkyB +
Slide 9: Net Debt Evolution
Net debt has been reduced by &128; 25 billion in 2002 due to the deconsolidation of Vivendi Environnement and asset sales Net Debt Evolution (including Vivendi Environnement) Op Net Debt VE CFFops Int , tax + div Inv. Sales Other Dec Est 21.4 18.8 18.8 21.4 15.9 12.3 0 37.1 15.7 2.7 2.6 3.8 9.2 3.6
Slide 10: Liquidity Update
Q4 2002 Q1 2003 Q2 2003 Q3 2003 Q4 2003 Q1 2004 Q2 2004 Q3 2004 Q4 2004 Case 3 5 0.9 2.3 2.4 3.7 1.1 1 0.8 4.3 Liquidity Update (in billions of euros) VE Exchangeable (&128; 1.9bn) Cegetel Investment (&128; 2.7bn) VU Oceane (&128; 1.7bn) Syndicated Loan (&128; 0.85bn) VE 2nd tranche +&128; 2.2bn Bon
Slide 11: Reduction of French GAAP Net Debt
Debt of Cos > 50% Owned BT Impact Net Debt/EBITDA Net Debt/EBITDA (proportional) Q2 2002 18.8 16.3 Q3 2002 18.6 15 Q4 2002 12.3 Q1 2003 11.1 4 3 4.5 Q2 2003 9.5 3.9 2.7 4 Q3 2003 8.3 3.9 2.7 3.8 Q4 2003 5.8 3.9 2.4 3.4 Q1 2004 5.1 3.9 2 3 Q2 2004 5.1 3.8 2 3 Q3 2004 4.7 3.8 1.9 2.9 Q4 2004 1.7 3.8 1
Slide 12: Divestiture Program Update
VU is reiterating the &128; 16 billion divestiture target by the end of 2004 The objective is to sell &128; 7 billion of assets in 2003 Divestiture Program Update * Already collected, the remaining &128; 21m are due after post-closing adjustments February, 2003 February, 2003 February, 2003 200 169*
Slide 13: Financing
Financing Returning to investment grade as soon as possible is a core strategic objective Maximizing our strategic flexibility through: Extending debt maturity Optimizing debt mix (bank / bonds) We have received proposals from our banks and are reviewing all of our options in light of favorable cond
Slide 14: 2003 Financial Outlook
2003 Financial Outlook Jean-Bernard Levy Chief Operating Officer
Slide 15: Cegetel/SFR: 2002 Performance
Cegetel/SFR: 2002 performance Revenue up 11%: Mobile, up 10%: 13.5 million customers, 35.5% market share on gross sales, 36.7% market share value Average revenue per user (ARPU): from prepaid up 13% to &128;22.2, from postpaid slightly up to &128;58.3. Fixed and others, up 18% Continue to benefit fr
Slide 16: Cegetel/SFR: 2003 Overview
Cegetel/SFR: 2003 Overview Projections: Revenue expected to grow around 7% on a like-to-like basis EBITDA expected to grow by more than 15% Operating Income expected to grow by more than 25% Cash flow from operations expected to be flat due to higher level of capital expenditures Priorities: Continu
Slide 17: Music: 2002 Performance
Music: 2002 Performance Revenue down 1% at constant currency: Universal Music Group outperformed the market with a global market share estimated to have increased from 22.8% in 2001 to about 24%. Increase in sales of recorded music and license income offset by higher provisions for returns. Best sel
Slide 18: Music: 2003 Overview
Music: 2003 Overview Projections*: Revenue expected to be slightly down at constant currency, UMG to outperform the industry. EBITDA margins expected to be flat or down slightly. Operating Income margin is projected to continue to decline. Cash flow from operations target close to 2002. Priorities:
Slide 19: Vivendi Universal Entertainment: 2002 Performance
Vivendi Universal Entertainment: 2002 Performance Full Year 2002 * Proforma: includes USA Networks, Inc.'s entertainment assets as of January 1, 2002 Revenue up 5% at constant currency Universal Pictures up: Improved home video and TV results driven by prior years' theatrical releases (The Mummy, Th
Slide 20: Vivendi Universal Entertainment: 2003 Overview
Vivendi Universal Entertainment: 2003 Overview Projections*: Revenues expected to increase slightly in constant dollars versus 2002 EBITDA margin projected to decline by mid-single digit points Operating Income margin expected to decline by mid-single digit points Cash flow from operations projected
Slide 21: Canal+ Group: 2002 Performance
Canal+ Group: 2002 Performance Revenue up 4% at constant currency Pay TV France: French Premium channel churn rate under control (10.6%) despite net decrease of 70,000 subscribers; 220,000 new individual subscribers at CanalSatellite. StudioCanal: Success of strong theatrical releases such as Le Pia
Slide 22: Canal+ Group: 2003 Overview
Canal+ Group: 2003 Overview Projections : Revenue: expect a double digit decrease versus 2002 because of perimeter changes in 2003, should be flat at constant perimeter EBITDA: double digit growth expected Operating Income: should be positive Cash flow from operations: improvement, but still expect
Slide 23: Maroc Telecom: 2002 Performance
Maroc Telecom: 2002 Performance Full Year 2002 Revenue up 13% at constant currency Strong mobile prepaid consumer growth. Mobile consumer base grew by 940,000 customers to approximately 4.6 million. Operating Income up 1% at constant currency Intangible assets depreciation booked in 2002 for the fir
Slide 24: Maroc Telecom: 2003 Overview
Maroc Telecom: 2003 Overview Projections : Revenue: expected to be flat EBITDA margin expected to be flat Operating Income: margin expected to improve Cash flow from operations expected to be flat Priorities: Attract more subscribers while maintaining the loyalty of current subscribers Ensure commer
Slide 25: Vivendi Universal Games: 2002 Performance
Vivendi Universal Games: 2002 Performance Revenue up 25% at constant currency Continued strength in the PC market Warcraft III, Empire Earth, Diablo 2. Rapidly escalating presence in the console games market (44% of Vivendi Universal Games sales in 2002) Crash Bandicoot: The Wrath of Cortex, The Thi
Slide 26: Vivendi Universal Games: 2003 Overview
Vivendi Universal Games: 2003 Overview Projections*: Revenue expected to grow by more than 15% EBITDA margin projected to be flat with 2002 Operating Income expected to exceed 10% of revenue Cash Flow from operations expected to increase Priorities: Management of intellectual property Continue conso
Slide 27: General Group 2003 Guidance: A Transition Year
General Group 2003 Guidance: A Transition Year Very strong growth expected 731 10 Proportional Cash Flow from operations Net debt expected to be below &128;11 billion end of 2003 12.3 37.1 Net debt - year end (in billion of euros) Expected to be positive (0.47) (non Pro Forma) (0.1) (non Pro Forma)
Slide 28: Euro/Dollar Impact Expected in 2003
Euro/Dollar Impact Expected in 2003 Based on the assumption that &128;1 = $1, 8% variance in &128;/$ exchange rate has an impact of: ^ - 1.5% on cash flow from operations ^ + 1.5% on cash flow from operations ^ - 2.5% on EBIT ^ + 2.5% on EBIT ^ - 2.0% on EBITDA ^ + 2.0% on EBITDA ^ - 2.5% on revenue
Slide 29: Conclusion
Conclusion Jean Rene Fourtou Chairman & CEO
Slide 30: Our Objectives in 2003
Our Objectives in 2003 Generate &128; 7 billion of asset divestitures in 2003; Strengthen our businesses to achieve positive earnings per share (before goodwill and exceptional) and improve cash flow; Recreate value for shareholders.
Slide 31: Appendices
VIVENDI UNIVERSAL Appendices March 6th, 2003 French GAAP - unaudited
Slide 32: Revenue/Operating Income Overview
Cegetel Universal Music group Vivendi Universal Entertainment Canal+ Maroc telecom Vivendi Universal Games Others Vivendi Environnement Est 7067 6276 6270 4833 1487 794 1385 30038 Cegetel Universal Music group Vivendi Universal Entertainment Canal+ Maroc telecom Vivendi Universal Games Others Vivend
Slide 33: Revenue Growth
Revenue Growth Cegetel UMG VUE Canal+ Maroc Telecom VU Games Others & Holding Holding and Corporate 2001 6384 6560 6874 4563 1351 657 1344 -492 2002 7067 6276 6978 4742 1487 794 1385 -369 In 2002: Total Group Pro Forma* revenues +4% +6% on constant currency basis 2001 2001 27733 2002 28729 Details b
Slide 34: Operating Income Growth
Operating Income Growth Cegetel UMG VUE Canal+ Maroc Telecom VU Games Others & Holding Holding and Corporate 2001 928 719 928 -374 475 18 -581 -492 2002 1449 556 946 -295 468 63 -1150 -369 In 2002: Total Group Pro Forma* operating income down 4% Flat on constant currency basis 2001 proportional 978
Slide 35: Cash Flow from Operations
Cegetel UMG VUE Canal+ Maroc Telecom VU Games Others & Holding Holding and Corporate 2001 1267 152 669 -480 383 -126 -641 -492 2002 2058 523 465 -353 599 76 -735 -369 Cash Flow from Operations* *Before interest and taxes, after restructuring ** Excluding businesses sold in 2002 35% SFR Access throug
Slide 36: Segment Revenues
* As of January 23, 2003, VU holds a 70% interest in Cegetel (representing 56% of SFR, versus 35% as of December 31, 2002) **The % are provided for informational purposes only. The reported numbers are 100% consolidated Segment Revenues In millions of euros Pro Forma 1,821 2,075 1,838 1,300 372 292
Slide 37: Segment Operating Income
In millions of euros * As of January 23, 2003, Vu holds a 70% interest in Cegetel (representing 56% of SFR, against 35% as of Dec. 31, 2002) **The % are provided for informational purposes only. The reported numbers are 100% consolidated Segment Operating Income Pro Forma 243 371 62 (275) 153 26 580
Slide 38: P&L Details Excluding Businesses Sold in 2002
P&L Details Excluding Businesses Sold in 2002 Financial Results Net interest expenses: &128;(650) 4.1% of average interest rate Other financial expense: &128;(658) Of which: Capital gain on sale of portfolio investments & marketable securities &128;143 Net impact of VU puts not exercised or exercise
Slide 39: Exceptional Items and Taxes
Exceptional Items: &128; 1,124 of which Disposal of BSkyB &128; 1,588 Disposal of VE (15.5% + 20.4% + dilution profit) &128; 1,408 Disposal of VUP assets to Lagardere &128; 329 Disposal of Sithe &128; (284) Disposal of BtoB & Health publishing &128; (298) Provision on disposal of Telepiu &128; (360)
Slide 40: Management Team
Jean-Francois Dubos Executive Vice President and General Counsel Rene Penisson Advisor Social Relations and Organization Michel Bourgeois Executive Vice President, Corporate Communications Hubert Joly Executive Vice President Monitoring of US Assets and Deputy CFO Management Team Robert de Metz Seni
Slide 41: Management Incentives and Corporate Governance
Management Incentives Bonuses based on EPS and FCF Stock Option plans Strong Management Team in Business Units Board of Directors: 3 new Directors have been co-opted at the January 29, 2003 Board meeting Corporate Governance VU has a strong management team dedicated to create value for shareholders
Slide 42: Board of Directors / Committees
Board of Directors / Committees Board of Directors Dominique Hoenn Chief Operating Officer, BNP Paribas Paul Fribourg Chairman and CEO, ContiGroup Companies Marie-Josee Kravis Senior Fellow, Hudson Institute Gerhard Kleisterlee Chairman and CEO, Philips Edgar M. Bronfman Former Chairman of the Board
Slide 43: IR Team
IR Team Eileen McLaughlin IR Director eileen.mclaughlin@goupvu.com Laurence Daniel IR Director laurence.daniel@groupvu.com Edouard Lassalle Associate Director edouard.lassalle@groupvu.com Daniel SCOLAN Executive Vice President Investor Relations +33.1.71.71.12.33 daniel.scolan@groupvu.com For any up
Slide 44: Corporate Communications Team
Corporate Communications Team Antoine Lefort Senior Press Relations antoine.lefort@groupvu.com Alain Delrieu Senior Press Relations alain.delrieu@groupvu.com Agnes Vetillart Senior Press Relations Agnes.vetillart@groupvu.com Michel Bourgeois Executive Vice President, Corporate Communications +33.1.7