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Thomson Core Sales Rise 11.8% In First Half

Paris — Strong contributions from “growth engines,” such as DVD services and set-top boxes, boosted core net sales in the first half at French media and entertainment company Thomson by 11.8 percent, hitting $3.4 billion, up from $3.1 billion in the first six months of last year.

Core media and entertainment systems consist of three segments — services, systems and equipment and technology. Among the media and entertainment businesses are licensing revenue, home networking connectivity and DVD home entertainment and film services.

In the systems and equipment segment’s first half, Thomson noted a “solid performance” from set-top boxes, offset by “poor performance” in audio/video products with connectivity. The company said margins grew in set-top boxes, and were “broadly stable” in other activities, except audio/video.

Thomson expects the systems and equipment division will grow more slowly in the second half, compared with a “very strong” second six months in 2004, and given the weaker audio/video activity.

Pro-forma core net income climbed 25 percent in the first half, ended June 30, reaching $78.5 million, up from $62.8 million in the same six months a year earlier.

Thomson’s non-core displays and CE partnerships, which, in the past, included RCA-brand consumer electronics products, reported first-half sales of $233.1 million, down from $997.5 million in the same period in 2004. However, comparison of non-core business sales year-over-year is not meaningful, said the company, since some activities are now treated as discontinued operations.

Thomson said the disposal of its tube business and related charges accelerated into the second quarter ahead of schedule, with the main activities discontinued. Discontinued operations in the first half accounted for a loss of $483 million, compared with a loss of $271.7 million in the same time frame a year ago.

Consolidated Thomson revenue from continuing operations in the first half hit $3.6 billion, down from $4.1 billion in the first six months of the prior year.

The company reported a consolidated loss from continuing operations of $74.9 million, compared with profit from continuing operations of $41.1 million in the same six months in 2004.

Consolidated net loss for the first half reached $568.8 million, compared with a net loss of $229.4 million in the first six months of last year.