Universal Music has publicly forecast for the first time the amount of extra revenue that will be generated by its £1.2bn buyout of EMI.
Universal parent Vivendi anticipates that the deal, which was approved in September by US and EU regulators, will bring in £100m of annual synergies once the merger is operationally complete.
"Management focus is currently on EMI integration, which is moving ahead at full speed," Vivendi CFO Philippe G. H. Caprone told investors last night. "We are able to confirm the objective to generate £100 million plus of annual synergies, thanks to this acquisition."
Discussing Universal Music's Q3 fiscal performance, in which the company posted a 2.5% decline in earnings before interest taxes and amortisation in the first nine months of 2012, he said:
"For music, we unfortunately have to report a relatively disappointing Q3. You remember that we had a brilliant Q1. We had an average Q2. And now we have a Q3 which is not looking as good. We are used, of course, to those roller coaster effects, which are mostly release calendar driven. The good news is that we expect a very strong Q4 on the back of a more promising release schedule."
Universal posted posted EBITA of €238 million (approx $302 million) in the first nine months of 2012, as revenue rose by 2.1% to €2.9 billion ($3.68 billion).
"[We've] already some Q4 successes, Taylor Swift to mention one," added Caprone. "So we should be able to improve the performance by year end. After nine months, revenues are slightly down at constant currency, which is why EBITA is down, in spite of the fact that this is hidden to a certain extent by the relative strength of the dollar.
He added: "We are, of course, extremely pleased that we have been able to reinforce markedly our positions in the top the worldwide music markets, the US, Japan and Germany. We had no remedies to envisage in either of those three markets, so we are fully confident that we'll exploit this new position in the best possible way.
"Incidentally, the disposal of... the EMI businesses which we'll had to divest, is underway and is fully on track. And we expect to be in a position to report good news in the coming months regarding this process."