Ninth record in a row for PolyGram: Strength in North America and Far East offsets flat European trading

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The Independent Online
BRYAN ADAMS' album So Far So Good sold nearly seven million copies in six weeks to help PolyGram, the Dutch multimedia entertainment business, to its ninth successive record result.

In Amsterdam, the shares traded 1.5 guilders higher at 75 guilders while Philips, the electronics giant which owns 75 per cent of PolyGram, rose 0.6 to 46.6 guilders.

Strong sales in the Far East and North America helped to overcome flat trading in Europe to produce a 19 per cent increase in pre-tax profits. The dividend rose 22 per cent.

Alain Levy, chief executive, said he was more confident about PolyGram's prospects in the US than for many years following a doubling of operating profits. In the Far East sales were 31 per cent higher.

Mr Levy added: 'We feel confident of growth in 1994 and beyond. Our expected release schedule for both music and film looks very strong this year and should provide for an exciting 12 months.'

Despite an increased focus on film production and distribution, PolyGram is still driven by its pop music division, which provided 69 per cent of sales last year. In addition to Bryan Adams' success, Sting's Ten Summoners' Tales and U2's Zooropa both sold more than four million copies.

The pounds 202m acquisition of Motown, the black music label, last September contributed one of 30 million-selling records, Christmas Intepretations from Boyz II Men. Mr Levy said PolyGram was negotiating possible Motown video games with Philips Media, of which he was a board member.

Classical music sales were broadly similar to 1992 despite price competition, contributing 12 per cent of total revenues. Music publishing had a strong year.

In the emerging film division 13 titles were released during the year. These included Posse, the black western, the first issue by Gramercy Pictures, PolyGram's joint venture with Universal Pictures.

Twelve new films started production in 1993, leading to an expected 15 releases this year including Backbeat, a film about the early years of the Beatles.

Sales in the year to December rose 12 per cent from 6.6bn to 7.4bn guilders ( pounds 2.6bn). Income before tax was almost a fifth higher at 927m guilders (780m guilders) and net income per share was 3.56 guilders, up 19 per cent. The dividend was 0.75 guilders.

Following the issue of 10 million shares to buy Motown, gearing fell from 26 to 18 per cent.

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