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VNU profits decline 83%

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Haarlem, the Netherlands--VNU NV on Wednesday reported net earnings of $188 million for 2002, an 83% decline compared with 2001.

That comparison, however, is skewed by VNU's divestment of its consumer magazine division in 2001, which allowed the company to take a one-time gain of $1.1 billion in 2001.

Total 2002 revenues slid 11% to $4.72 billion, and total operating income fell 8% to $843.8 million. But the company described its performance as successful in light of generating cash earnings before goodwill of $498.6 million in 2002, an increase of 9% over 2001.

“Much of our success can be attributed to the strong performance of our recession-resilient businesses--marketing information, media measurement and information, and U.S. trade shows--as well as to cost-saving measures, which offset continuing weakness in our advertising-dependent business information group,” said Rob van den Burgh, VNU’s chairman-CEO. This group, which includes the Hollywood Reporter and Billboard in the U.S., saw its revenue decline to $854.8 million in 2001 from $1.0 billion in 2001.

Because of cost cuts, however, operating income for the division declined just 5%, to $118 million in 2002 from $124 million in 2001. The outlook for the business information group remained bleak, however, as VNU expects advertising revenues to continue their decline in 2003.

--Sean Callahan

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