Lagardere swings into profit in 2003

PARIS, March 15 (AFP) – The French group Lagardere, which has activities in publishing, defence and space technology, swung to profit in 2003 but declined to issue a forecast for operations this year.

Lagardere showed a net profit of EUR 334 million (USD 410 million), against a loss of EUR 291 million in 2002, it said in a statement.

Operations excluding its stake in EADS, the European aeronautics, space and defense equipment group, turned in a profit of EUR 263 million against a comparable loss of EUR 33 million one year earlier.

Overall operating profit soared by 52.5 percent to EUR 671 million, and when EADS results were stripped out, the increase still came to 18.6 percent at EUR 439 million.

Media operations showed an 11 percent increase to EUR 427 million.

Lagardere shares fell in midday Paris trade, but nonetheless performed better than the overall CAC 40 index of leading shares.

“In contrasting markets, the net improvement in Lagardere Media’s operating margin underlines the quality of its business lines (leading market positions, strong international presence, balance between cyclical and con-cyclical businesses) and fosters continuation of our cost reduction and accelerated growth plan,” the statement quoted chief executive officer Arnaud Lagardere as saying.

Hachette Filipacchi Medias, a Lagardere Media subsidiary, is the worlds leading magazine publisher, with 238 titles in 36 countries, including Elle, Paris Match and Car and Driver.

Lagardere told a conference call with analysts that earnings growth in the media division could surpass six percent in 2004 if there is an economic upturn in the second half of the year.

He also said that Jean-Pierre Cottet had been hired to direct the group’s audiovisual operations excluding radio.

Earlier this month, the French daily Le Figaro speculated that the appointment of Cottet, a well-known figure in French television broadcasting, could indicate Lagardere’s interest in acquiring the Canal Plus television unit from Vivendi Universal.

Lagardere is also to launch the sale of several Editis publishing businesses at the beginning of April, company officials said.

The group bought the Editis operations from Vivendi Universal last year but was ordered by the European Commission to divest businesses representing 60 percent of the unit’s total revenues in order to secure approval of the deal.

Elsewhere, the contribution of EADS – which accounts for 15.07 percent of Lagardere’s results – to consolidated operating profit multiplied almost four times to EUR 232 million from EUR 63 million in 2002.

That was “due to improvement in its profitability – specifically due to growth both in volume and profitability of the military businesses – and to the appreciation in the average dollar hedge rate,” the statement said.

Net debt stood at EUR 882 million, and the group has proposed a dividend of EUR 0.90 per share, up 10 percent from the previous year.

Lagardere shares slipped 0.82 percent to EUR 44.88 in Paris, while the CAC 40 index was one percent lower overall, with Deutsche Bank analysts welcoming the group’s “good 2003 results”.

Subject: France news