Laurent Mairot - EVP, IR and Corporate Development Arnaud de Puyfontaine - Chairman and CEO Hervé Philippe - CFO

Adrien de Saint Hilaire - Morgan Stanley Charles Bedouelle - Exane Julien Roch - Barclays Ian Whittaker - Liberum Capital Conor O'Shea - Kepler Cheuvreux Lisa Yang - Goldman Sachs Marcus Diebel - JP Morgan Laurie Davison - Deutsche Bank

Ladies and gentlemen, good day, and welcome to the Vivendi First Quarter 2017 Revenues and Earnings Presentation Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Laurent Mairot, Executive Vice President, Investor Relations and Corporate Development. Please go ahead, sir.

Good evening, ladies and gentlemen. Welcome, and thank you for joining us for Vivendi's first quarter 2017 earnings. Your hosts for today's call are Arnaud de Puyfontaine, Chairman of the Management Board and Chief Executive Officer; and Hervé Philippe, Member of the Management Board and Chief Financial Officer. This presentation will be in English. This call is webcast on vivendi.com, where presentation slides are available for download. I encourage you to read the important legal disclaimer found at the end of this presentation on Page 27. The first quarter 2017 financial report will be available on our website at the end of the call. On our website, you will also find a replay of this call that will remain available for 15 days. As usual, we will leave time for a Q&A session at the end of the presentation. This presentation, as well as the Q&A session, will be dedicated to the first quarter results only. We will not discuss or take any question relating to the proposed transaction that has just been announced now. A separate call dedicated to the transaction will take place at 6:45 p.m. just after the Q1 2017 earning call. Note that this second call is closed to callers from restricted jurisdiction, including the United States, Canada, Japan, Italy and Australia. And now, I have the pleasure of introducing the Chairman of our Management Board and CEO, Arnaud de Puyfontaine.

Thank you, Laurent. Welcome, everyone. Thank you for joining us today. Hervé Philippe will go through our earnings in detail in a few moments. Let me just emphasize that Vivendi is on track to meet its full-year outlook. As I said last time, we talked 2017 is a year of growth for the Group. Revenues should increase by more than 5% and EBITDA by around 25%. The first quarter 2017 was marked by Universal Music Group's strong performance and by the first signs of recovery in France for Canal+. In music, Universal Music Group has recorded its sixth consecutive quarter of revenue growth, largely fuelled by a 49% increase in subscriptions and streaming. We are at the forefront of the streaming transition, thanks to partnerships with more than 400 digital platforms. It is worth mentioning that Universal Music Group is the first major music company to reach a global licensing deal with Spotify. This agreement, signed last month, provides greater flexibility for new releases and co-operations on innovative marketing campaigns across the world's largest streaming service. In television, the Canal+ transformation plan in France is well underway. In November 2016, Canal+ Group completely over rolled its pay-TV packages by providing more customization, more choice and more freedom to its subscribers. This is starting to bear fruit. Last March, for the first time in many quarters, the number of new pay-TV subscriptions offset the number of cancellations. The impact of the transformation plan on EBITDA is expected to be tangible from the second half of 2017. We are building a sustainable business model for Canal+ which involves paying the right price for what our subscribers want. We will not pay silly money for rights. We have been serving customers for further years and we will continue to do so in the years to come. In sports, we enjoyed first choice rights in France with the French Football Championship and the Top 14 in rugby. Most recently, we signed a new agreement for the broadcasting rights of Formula One for three additional seasons. In mobile games, Gameloft had its all-time second best quarter. It released two new games in March, Gangstar New Orleans and N.O.V.A. Legacy, which respectively registered more than 7 million and 12 million downloads. These good results demonstrate that Gameloft integrations within Vivendi is fully successful. In addition to these three pillars, a new dimension with completely revamped user interface and premium experience will be launched in June. It will mark an important step in its transformation. Last but not least, the slate proposed by Vivendi for Telecom Italia's Board obtained the majority of votes at the company's shareholders meeting held last week. The new Board composed of 15 members, including 10 independents, will be a valuable asset in the development of Telecom Italia strategy. Once again, Vivendi reaffirms its long-term commitment to Telecom Italia and its desire to create significant value for customers, employees and shareholders. As mentioned during Vivendi's shareholders meeting in April, we are focused on long-term value creation. Our Chairman, Vincent Bolloré, the entire supervisory board and the management board, all share the same vision, which is making Vivendi a world-class player in content creation and distribution. The Group has laid the foundations to achieve this ambition and is now ready to embark on the new phase of growth. The proposed transaction, which has just been announced, is a new step in Vivendi's strategic project. We will have the opportunity to discuss it after this call. Thank you for listening. And I will now hand over to Hervé Philippe. Hervé Philippe: Thank you very much, Arnaud, and good evening to all of you. It's really a pleasure for me to present to you our results for the first quarter of the year, which are in line with our previously issued guidance for full-year. Before going through the results, I'd like to remind you of the changes in the scope of consolidation and the main currencies of the Group. In terms of scope of consolidation, Telecom Italia has been accounted for as an equity affiliate starting December 15, 2015, with the lag of one quarter. In Q1 2017, we accounted for three months of Telecom Italia results against only 15 days in Q1 2016. In addition, Gameloft and Paddington have been consolidated since the end of June 2016. With regard to the currency changes, the most noticeable change was the inquisitively negative impact of the GB pound, down 11.5% on average, compared to the first quarter 2016, while the U.S. dollar on the Japanese yen increased against the euro by 3.1% and 5.5%, respectively. Note that the impacts of these currency changes are mostly just conversion-related mainly at the level of revenues. On Slide 4, we highlight a few changes in the way we present the profit and loss account. In order to better align the presentation of the P&L with the one prepared by Banijay Group, which will fully consolidate Vivendi as from April 26, 2017, we have made few changes in the presentation as a consolidated P&L as from January 1, 2017. The changes which are logical for Vivendi being an integrated group are as follows. First, we reclassified the income from equity affiliates within EBIT. And second, we reclassified the impacts related to the financial investment operations from the line Other Income and Charges within EBIT to the line Other Financial Income and Changes below EBIT. For more details, you can refer to the note 1.2 of the first quarter financial statements. On Slide 5, you have the usual summary of the key financial metrics. As we mentioned in February, the Group is now poised for growth. In Q1 2017, revenues grew 3.4% year-on-year, reaching €2,663 million. UMG's strong performance, up 12.7%, more than offset the decline at Canal+. The growth in profitability at UMG was very solid, but as expected, it was not in enough to offset the decline in profits at Canal+. Therefore EBITDA was down 34% organically but was completely in line with the full-year guidance of 25% decrease in EBITDA. In IFRS, EBIT reached €185 million, down 52% compared to the first quarter of 2016, which included one-time impact of €240 million related to the reversal of reserve resulting from the settlement of the Liberty Media litigation. At €155 million, adjusted net income was up 57.2%. Regarding the net cash position, it stood at €473 million at the end of March 2017 against €1.1 billion at the end of December 2016. Let's turn on now to the operation performances in the different business. On Slide 6, as you can see, Universal Music is performing extremely well. Overall UMG's revenues were up 12.7%. Q1 2017 was the sixth consecutive quarter of growth for recorded music at Universal Music. As a consequence of a solid release schedule, as well as continued growth in streaming and subscription services, recorded music revenues were up 12.2% organically, despite the decline of physical sales and our notes. In Q1 2017, UMG's bestsellers were The Weekend, Drake and the soundtrack from the La La Land and Fifty Shades Darker. The positive momentum of streaming also had a positive impact on publishing revenues, which grew by 14%. Merchandising and other revenues, which are quite small, also performed very well with growth of 13.3%. Income from operation was up 33% organically, mainly benefiting from the revenue growth and EBITDA grew 65.7%. As a reminder, restructuring charges amounted to €20 million in Q1 2016, compared to only €4 million in the first quarter of this year. On Slide 7, as you can see on the right-hand side of the slide, streaming and subscription revenues were up 49% year-over-year, while physical sales were down only 5.6% because of the nature of our Q1 original soundtracks. The most impressive indicator is probably the proportion of the streaming and subscription revenues, which in Q1, represented three quarters of digital revenues and almost 50% of Universal Music recorded music revenues, while it was accounted only one-third in Q1 2016. This indicator confirms that streaming and subscription is now a base for the main distribution format for Universal Music. Moving to Canal+ Group on Slide 8. Q1 2017 continued to be impacted by that deep-rooted past impacts, as well as tough comparable basis, mainly in pay-TV in mainland France. All the initiatives taken in 2016 will translate into results in the coming quarters with the objective of returning to growth in the second half of 2017, and achieving an EBITDA of approximately €350 million. During the first quarter 2017, revenues decreased by 3.5% organically, with the persistent significant decline at pay-TV in mainland France, partially offset by the continued good performance of the international operations, mainly in Africa. Indeed revenues of international pay-TV increased by 8.3%, with 28.6% growth in Africa. This illustrates the success of our strategy of providing the best content and the best offers. At the end of March, the number of subscribers in Africa stood at 2.6 million, slightly lower that at the end of December. As we saw over the last year, we experienced a seasonality erosion of the subscriber base in the first quarter following the strong promotion during the holiday season. However the trend remains very positive with a year-over-year increase of almost 650,000 subscribers. Pay-TV revenues in mainland France suffered a decrease, which was fully expected and can be explained by the lower average number of subscriber compared to Q1 2016, and the decrease in advertising revenues as a result of the reduction of free access windows on the Canal+ channels but benefited from revenue generated by the distribution agreement signed in 2016 with Free and Orange. As regards to the evolution of the subscriber base, even though the bars were in still in decline in Q1 2017, however we are seeing first positive trends. Over the months of March, the number of subscribers remained flat in mainland France for the first time in a long time. With regard to the performance of the new offers, we are satisfied with the first results. ARPU of the new subscribers is increasing, and since the launch of the offer, 70% of new subscribers have taken at least one option package. The churn is still high but should start to decrease by the end of the year, as a consequence of the fact that 95% of the subscribers to the new offers commit themselves for 24 months. The OTT version of the new Canal+ offers was also launched on an Apple TV and is meeting a good success. While we may need some more time to fully offset the successfulness of the new packages, these good signs are encouraging. Revenues of the free-to-air channels were down 5.1% due to lower audiences at CNews, previously i>Télé, despite good performances at C8. Studiocanal had good box office successes in the first quarter 2017 with Alibi.com in France, which sold 3 million tickets and the distribution of La La Land in Germany. However revenues declined by 8.5% due to lower DVD and VOD sales and sales to TV channels compared to last year. These two trends are linked to the low performance at the end of 2016. Regarding the profitability, despite the cost optimization plan, income from operations were down 70% as a result of the decrease at pay-TV mainland France, as well as higher programming costs compared to last year. Higher cost, mainly relate to sports rights with increase of cost of the French Football since last August, following the start of the new agreement, and also to programming costs related to cinema and service and Canal+ channels, as well as higher spendings at C8 with the objective of increasing its audience. As previously mentioned, we expect Canal+ Group's financial performance to recover significantly. For 2017, EBITDA is expected to reach approximately €350 million, a strong improvement over the €240 million achieved in 2016. Over the year, we will see opposite dynamics between the first half and the second half. As previously explained, the first part will continue to be heavily impacted by a tough comparable basis against the same period last year on revenues and on costs. We should see very different trends in second half. First, we anticipate a much lower impact on subscription revenue with a smaller year-over-year difference in the average number of subscribers, as the new offer gains traction. Second, on a comparable basis, we will no longer have the negative impact of lower advertising revenues and higher sports right costs. The programming costs on the free-to-air channels should also be more on a like-for-like basis. Studiocanal is expected to benefit from the stronger line-up during the second half. Now turning to Slide 10 and to Gameloft. Gameloft is performing very well. With €68 million in revenues, Q1 2017 was it's second best quarter ever and revenues grew by 9% excluding one-off item accounted for last year. This performance is due to the strong performance of the catalog as well as advertising revenues, which reached 12% of Q1 2017 revenues. During the first quarter, Gameloft benefited from the strong performance of its game, Disney Magic Kingdoms in the US. In Q1 2017, income from operations reached €4 million. As for the other businesses on Slide 11, you can see Vivendi Village, good performance in terms of revenues, which grew by 3.6%, while New Initiatives revenue is still declining due to Dailymotion, whose repositioning is set for June. All the initiatives launched in these other businesses, like the opening of the networks of entertainment venues in Africa and Studio+ as well as the transformation of Dailymotion are still in the investment stage and thus result in losses at the income from operations level. We look very closely to the expenses in these initiatives, which are under strict control month after month. Going to Slide 12 and to the presentation of the consolidated P&L. As we have seen earlier, the strong performance of Universal Music was not enough to offset the still declining EBITDA of Canal+ Group. Therefore EBITDA was down by 29.9% in Q1. But the decrease in EBITDA is not only compensated by the positive contributions of Telecom Italia in Q1 2017, compared to a negative impact in Q1 2016. However because of the €240 million reversal of reserve related to the Liberty Media litigation in Q1 2016, EBIT is down €200 million. Q1 2016 was also positively impacted by the sale of the remaining stake in Activision Blizzard for €576 million before taxes, which together with Liberty media settlements largely explained why its earnings attributable to Vivendi's SA shareowners is down 88% at €101 million. However adjusted net income grew 57.2% year-over-year, standing at €155 million and benefited from the improved contribution of Telecom Italia results, as well as lower income tax charges. Moving to the consolidated balance sheet on Page 13. In fact the situation at the end of March is quite similar to that at the end of December 2016, with no major changes. The most noticeable impacts were other financial investments, which increased mainly as a result of the reevaluation of our participations and the decrease in net cash, which stood at €473 million at the end of March 2017. A good transition to the net cash evolution on Slide 14. Over the first quarter of 2017, the net cash decreased by €0.6 billion, mainly due to acquisition of approximately 12 million of Vivendi shares since the beginning of the year for €0.2 billion. Secondly a negative CFFO of €0.2 billion, operating cash flows were negatively impacted by significant advances paid to artists by Universal Music and by the lower profitability at Canal+ as well as some one-time payments related to certain agreements. Since the end of March, we can only highlight the payment of the dividend for €0.5 billion at the beginning of May, as well as the reimbursement from the French tax authorities of around €340 million following a judgment by the Administrative Court related to the fiscal year 2012. At the end of March 2017, net cash stood at €0.5 billion, with €0.4 billion of cash available bonds, as well as undrawn credit line of €1.5 billion as of May 9. Thank you very much. And now we will leave you some time for Q&A session.

[Operator Instructions]. Our first question is coming from Adrien de Saint Hilaire from Morgan Stanley. Please go ahead. Your line is open.

Good evening, everyone. Thanks for the presentation and taking the questions. I've got three of them please. Two around Canal+. First of all, can you share some thoughts around the loss of the Champions League rights? I'm sure you've done some studies perhaps telling you how many subscribers are at risk of perhaps leaving Canal+? And second sub-question. You'd be interested if that was available for signing a wholesale or distribution agreements with SFR, if ever that was made available? So that's on Canal+. And on UMG, the physical sales were only down 6% in Q1, which is much better run rate than what we've seen before. Was there any one-off - maybe any particular artist which had, I don't know, a heavy skew towards physical that explained this, or have we reached a bottom when it comes to physical?

Merci, Adrien. Arnaud de Puyfontaine speaking. I will take your first question as regards to the comments with the Champions Leagues right. A few things. Number one, I'd like emphasize the point that we're going to get the Champions League till 2018. Number one. So we don't know what's going to be the environment at that time. Second point, we are talking about 16 games on Canal+ as regards to the Champions League, and we think that, as regarded to what maybe the outcome in 2018, this is not a move that is going to threaten [ph] the compelling proposition in terms of sport offering of both Canal+ and Canal+ Sports in our new package. Third thing, I'd like to focus on an interesting situation which is the situation of Sky in the U.K. which doesn't broadcast the Champions Leagues right, and it's got a business model which is doing pretty well. And last but not least, I would just tell you that Canal+ has gone through many different strategic evolution over the past 20 years, and yes, we are faced with a player which is really to put a price, which I would comment that being a price that we were not ready to pay, and for one reasons is that this is a price on which we don't see any sustainable business model. So the bigger risk for us would be a risk of putting a price that could jeopardize the job that has been done over the past 18 months and to do that only to keep a right, which at the end of the day, would not make any sense in the interest of the sustainability of the Canal+ pay-TV business model on the one hand and in the interest of the value creation and the sustainability of the pay-TV offered in France. So to cut a long story short, part of the competitive environment, no regret as regard to a situation which we don't think that it is a sensible price, and let's move on.

Thank you. Hervé Philippe: To answer your second question on SFR on wholesale agreement. We have no discussion with them on any kind - in any sort of discussion on wholesale agreements. And for the question regarding the physical sales decline at Universal Music, I'm not sure that we can consider that we are bottom at this level minus 5%. The first quarter has been, I would say, positively impacted by some original soundtracks, so I will not bet on the future quarters in physical sales.

Our next question is coming from Charles Bedouelle from Exane. Please go ahead. Your line is open.

Thanks for taking the time. Just a quick follow-up on Adrien's question around music. I understand one quarter doesn't make the year. Can you tell us what you think is the share of positive surprise or abnormal element that would be linked to soundtracks in your very, very stronger Q1? And also regarding Adrien's question on the decline in the physical formats. If we haven't reached the bottom, what do you think is a more normal decline for this format on normal year for UMG? That would be my first question. And the second question, I guess, is you alluded to the fact that in a year from now or more, when the Champions Leagues [ph] rights will move, you might be in a different competitive environment. And I just wanted to know if you could give us maybe what you think could be different in a competitive environment a year from now for you or maybe from some telco players? That would be very helpful. Thanks.

Bonjour, Charles. So thank you for your question. I will start by the last one, which is experience has led us to just plan for what we can control and to do the very best under those criteria, but to be ready to expect different moves that are unexpected. And this is what we do. So in more than 12 months from now, we do think that there are going to be certainly some moves in the environment. We are very happy about the renewal of the Formula One results for three seasons. We're very happy about the Top 14 rugby and so on and so forth. But what I say is we are going to get in 12 months the results of the recovery of Canal+ pay-TV. This is our ultimate goal. If we have to go through a situation where again some can make some moves that we don't consider to be sensible, we are not going to be driven by this. And again, what is very important for us is to be long-term to be successful and to avoid a certain kind of ego-driven type of move that could destroy the reality and the quality of the good job that has been done by the Canal+ Group team since now summer 2015. So many things may happen from now till then, and want the space. This is what we do mean by this comment. Hervé Philippe: Well, to answer the first question on the physical sales in Universal Music. Well, it's quite difficult to evaluate what will be the trend full-year in the decline, but if you take the average decline in 2016, it was something in the range of 15%. In fact it will clearly deepen also of the take-off of streaming and subscription in some countries where physical are still very, very high. As you remember, probably Japan or Germany, physical sales remained very, very high. So it will largely depend on the development of subscription and streaming in those countries in major. Thank you.

And maybe just a very quick follow-up, maybe for you, Arnaud. Any comment on SFR's move and - this one and the one before in terms of how the antitrust could think about the competitive environment for Canal, which may not be a monopoly anymore as they discussed in the past. So any comment on that?

A comment that I bet on the reality fact-checking of regulators just to create an environment, which is going to be taking into account those kind of moves. So I'm not going to comment any further because we are in the process. But I think that if needed a kind of a wake-up call as regard to the environment and the acknowledgement that the rule of the game are changing and that it has to be need to rethink about the way to think about the market, the environment, the competitive environment and the radical changes in the way to think about the industry should in fact create a reality check. But I'm expecting to see what's going to be the outcome of the process in which we are.

That's very clear. Thank you very much, Arnaud.

Next question is coming from Julien Roch from Barclays. Please go ahead.

Yes, good evening, and thank you for taking the question. Questions on Canal+. You have very helpfully giving us a target for operating profit or EBITDA for this year of €350 million. You clearly control a lot of things in that numbers more on the cost side but not necessarily the revenue. So if you could have an idea of the revenue level in terms of subscription you expect to get at that €350 million, some pointers would be really helpful. That's my first question. The second question is, Hervé, at one point you said that the ARPU of the new offer was increasing. You mean the ARPU of the new offer is higher now than mid-November. You don't mean that the ARPU of the new offer is higher than the old offer? If you could clarify this. And could we get what the ARPU is of the new offer, so we can have an idea whether that's ARPU accretive or ARPU dilutive? And then the last question again on Canal+ is, if you could give us any comments on the price you paid for Formula One? That would be amazing. Merci. Hervé Philippe: We have given a precise figure on the level of EBITDA, which is approximately €350 million in 2017 for whole Canal+. This was clearly to show you that we will have very different phasing in the years in terms of result mainly driven by the cost side of that and the comparison basis is very tough in terms of cost in the different semesters of this year. For the subscription revenues, we can expect to have a smaller difference. On the average number of subscribers which are expected in the second part of the year, thanks to the new offer. So we have more declines in revenues in the first part compared to last year, that's one which is expected in the second part of this year. For the ARPU on the new offer, we have an increase of those ARPUs and the figures which are given are considered by the old ARPU and the old calculation, I would say. But it's clear that we have been positively - not surprised but to have been positively seeing the level of ARPU with the new offers, especially the level of the acquisition of packages by the new customer. The fact that we are pricing into versus €20 could have been that threat on the ARPU, but in fact we see that the vast majority of our customers pay one or more packages in addition to the entry price. For the Formula One, I will not give any idea of the price we are paying.

Okay, just coming back to…

Arnaud de Puyfontaine speaking, sorry. And I wouldn't give the number but I would just say that it is a number that is making the proposition a reasonable sound and a good one in the context of where we are at Canal+.

Okay. And just to be clear, Hervé, are you saying that the new offer - the average ARPU of the new offer is higher than the average ARPU of the other offers, or that's not the case and it's lower? Hervé Philippe: It's higher. The ARPU of the new subscriber is higher than it was in the past.

Okay. Thank you.

Our next question is coming from Ian Whittaker from Liberum. Please go ahead. Your line is open.

Thank you very much. Two questions please. First of all, just going back on music and extremely good reasons you had. Also what I was accompanied by was a sharp increase in the EBITDA for the first quarter. Would you provide us with an explanation of how we could think in terms of the revenue drop from the growing services such as streaming the profitability and also as well just in terms of what it would mean for the cash flow profile from music? And then the second thing is just in terms of games. Obviously you've got some interesting games out as well. Are you quite happy with the size of your exposure to games at the moment, or do you think there is a potential to book of that business by making further acquisitions?

Thank you for your question. Arnaud de Puyfontaine speaking. I will take the question on games. As you know, we took control of Gameloft on July 1 last year, and as we referred to both in our annual results and confirmed in the trend we can see at this first quarter 2017, we are more than happy as regard to the performance of the Gameloft operation on in its own right but also in the capacity of the integration. Fantastic team. People very excited about the Vivendi project and very, very fit for purpose as regard to the strategic vision we are having from the Vivendi and the capacity of all our line of operations to work together. So we really ticked all the boxes. Now as you know, we are the number one shareholder on Ubisoft and we have made some statement that our willingness is to develop a really much stronger presence in this game sector. We've got different options. We are currently working and we will action on the chosen options in due time. But be sure that our ambition in that market is absolutely confirmed and it's not a question of if, it's a question of when and what.

May I just ask a quick follow-up - sorry, quick follow-up on that question? Just in terms of your view of gaining sort of longer term. Would you at the moment - obviously it's a smaller component than what music and Canal+ is. Would you imagine longer term that games would be as an important contributor to the profits as your music and Canal+ divisions?

I think that if you revert back to the AGM on the April 25, we made some statement as regards to - yes, that would be the ambition in the vision we are having for the future of Vivendi.

Okay. Thank you. And just for music? Hervé Philippe: To answer on Universal Music, you asked the question the cash flow profile for the year. In fact we are, in the first quarter, very specific expenses for Universal Music and specifically advances which have been paid to some major artists, which have weighted on the cash flow for the first part - for the first quarter. For the margin, we have also leveraged coming from the very satisfactory level of revenue, so we have an increase of 2% of the profitability. We'll see what will be for the full-year. You see what was the trend last year could be a good idea.

Thank you.

Our next question is coming from Conor O'Shea from Kepler Cheuvreux. Please go ahead. Conor O'Shea: Yes, thank you for taking my questions. Couple of questions please. Firstly, Hervé just on Universal Music Q1. Can you confirm that in the revenue growth there were no settlements over issues relating to rights that could be considered one-off in the 12.7% constant currency growth? Hervé Philippe: No, no specific one-time. Conor O'Shea: Okay, perfect. Then just two quick questions on Canal+. I wonder if we could have an idea - you mentioned, Arnaud, that you don't expect any negative impact from the loss of the Champions League rights. Can you give us an indication how much cost savings you could make from 2018 by no longer having to pay for these rights, even if they are - they could be reinvested in some other rights? And then the third question just on the wholesale subscribers, seem to be flat versus the end of December. Seem to contradict a little bit your comments on the take-up for the new offers for the premium channels, but also might have expected for these the wholesale subscribers Canal satellite. Are you happy that there is no further increase compared with end December? Hervé Philippe: Well, for Canal+ obviously the lot of the Champions thing will provide us with some savings, if nothing in 2018, as we have not given the price of it in the past, we will not give the level of the stream [ph] but it's, I would say, significant. For the wholesale subscriber, they are not new offers for the wholesale subscribers. They have a package of channels which are the Canal+ Panorama more or less channels, so we are roughly - I think it is the same level of subscriber in wholesale at the end of March. At the end of December, it will clearly depend on the launch of new offer. Sky is our partner. Free and Orange in the coming months. Conor O'Shea: Okay. Thank you. Hervé Philippe: Thank you.

Our next question is coming from Lisa Yang from Goldman Sachs. Please go ahead. Your line is open.

Good evening. My first question is on UMG. So you recently said at the AGM that some bankers put valuation of €20 billion on it. Just wondering what are your thoughts in terms of the ways to better crystallize the value of those asset and whether you could think of spinning-off at some point? Second question is on Canal+. And I want to go back to the churn which remains at very high level, about 17%. Just wondering whether there was any one-off there in Q4 and also in Q1, such as for instance cannibalization [ph] from the wholesale customers moving into retail and whether we should see some more normalization of that trend from the second quarter? Thirdly I was wondering whether you can provide any color on the subscriber trend in April. So you said stabilized in March, but are you seeing similar trends in April? And finally I think there was an article in the French press recently saying you could potentially withdraw your Canal+ offer some SFR platform. I'm just wondering if you're allowed to do that. Thank you.

Thank you. So we'll, from now on, take a very - give short answer to the question due to the constraint of time. So Lisa on the first point is we said that we have - we think that the value on the music operation is much greater than what is currently taken into account in our share price. We say that we could, in due time, take different measures just to be able to crystallize this value, but no decision taken in any shape or form. And last but not least, just to be able to show that the value of the music is much greater to what is currently recognized in our share price, will be to keep on developing the fantastic momentum, which we see in the business due to the quality of the job done by the team, led by Sir Lucian Grainge, and the capacity within the Vivendi Group to benefit also from all the common initiatives between our different line of businesses. So expect more good news to come, and we will do the very best to make that happen. As regard to your last question, I will not comment on these rumors as regard to the French press and what you read in the French press. But be sure that we'll do what has to be done to maintain the momentum within Canal+ and to reinforce our positive ARPU - sorry, competitive position. Hervé Philippe: Just to answer quickly on your question on the churn for the second quarter. It's obviously an issue to advise that cannot do - we're working hard on this item and we are much more confident in the second part of this year to adjust the churn. For April, we will not have yet at the meetings with Canal+ so I cannot give you any color on the figures for April.

Okay. Thank you.

Our next question is coming from Marcus Diebel from JP Morgan. Please go ahead.

Hi everyone. It's Marcus. I will just limit to maybe just one question in regards to time. Just again on your Canal Group EBITDA outlook. There was a question before but you haven't really been able to answer properly. I would rather ask in a different way. Is there any chance - and we had a discussion last month call, that you can at least tell us a little bit more about the impact of restructuring charges in that EBITDA bridge, at least to give us an indication how we should think what - how big the impact is going from €240 million to €350 million? Thank you. Hervé Philippe: Well, we have given the figure available of EBITDA and we have no specific or no very [indiscernible] charges expected, but we have - each year we have a certain amount. So I will not - I'm not in a position to give further details on that at this stage of the year.

Okay.

Our next question is coming from Laurie Davison from Deutsche Bank. Please go ahead.

Hi there. It's Laurie here from Deutsche. Yes, I'll limit it to one question as well. Just on the €350 million EBITDA guidance, you're stating that at constant perimeter and FX. Can you just give us the FX sensitivity approximately on the EBITDA for Canal+ division and also any - is there any further impacts that you're aware of that we should be take into account to adjust for changes in perimeter seeing about [indiscernible] potentially? Thank you. Hervé Philippe: No, we have given a global figure for whole Canal+ and we will not provide more detailed EBITDA by division. Sorry but it's at that level.

Sorry, I'm not asking for division. I'm just asking for the FX sensitivity on Canal+ on the €350 million and any further acquisition perimeter change impact over the rest of this year? Hervé Philippe: If it is question regarding the FX on Canal+, they are quite limited in fact because most part of Canal+ is in currencies related to the euro in Africa. So we don't expect any important FX effect, and there is no major change in scope at Canal+ in 2017.

Okay. Thanks.

That will conclude today's Q&A session. I would now like to turn the call back to our host for any additional or closing remarks.

Very much for those that attended the call, and I wish you a great evening. And maybe a few comments, Laurent?

For those who are in jurisdiction that I alluded, we will start in three minutes a call regarding the transaction that was announced earlier today. Thank you.

Ladies and gentlemen, that will conclude today's conference call. Thank you very much for your participation. You may now disconnect.