Sept. 1 (Bloomberg) -- Vivendi SA, owner of the world’s largest music company, Universal Music Group, said second- quarter profit rose 8 percent, aided by sales of its gaming unit’s titles “Guitar Hero” and “World of Warcraft.”

Adjusted net income, or profit excluding one-time gains and some costs, rose to 818 million euros ($1.17 billion) from 757 million euros a year earlier, the Paris-based company said in a statement today. Profit on that basis had been seen at 669.7 million euros, according to the average estimate of six analysts in a Bloomberg survey.

Vivendi Chief Executive Jean-Bernard Levy confirmed profit targets for the full year, saying the company will report “strong” growth in earnings before interest, tax and amortization, or Ebita. “The group is successfully weathering the current economic slowdown,” Levy said in the statement, adding that Vivendi will continue to invest and cap costs.

“Vivendi has reported earnings ahead of our estimates,” Bruno Hareng, an analyst with Oddo Securities in Paris, wrote in a note to investors. “We believe it is time to reposition on the share. We maintain our ‘add’ recommendation adopted yesterday and our target price of 24 euros.”

Vivendi rose 1.1 percent in Paris to 20.09 euros. The company’s shares have fallen 14 percent this year, giving Vivendi a market value of 24.6 billion euros.

Acquisitions

The company’s sales in the second quarter rose to 6.65 billion euros from 5.99 billion euros a year earlier. Net income increased 711 million euros from 667 million euros.

“There’s been a lot of acquisition activity around this group and that’s underpinning the financial performance,” Nick Bell, an analyst at Jefferies International Ltd. in London, said in a telephone interview. Bell has a “Hold” rating on Vivendi.

Levy bulked up all of Vivendi’s businesses through takeovers over the last two years, boosting earnings at pay-TV unit Canal Plus and at Maroc Telecom, the company’s Moroccan phone business. It last year merged its gaming unit with U.S. video-game maker Activision Inc. to create Activision Blizzard Inc., the world’s biggest games company.

“We are always on the lookout for acquisitions, especially in the developing world,” Levy said at a press conference today. “But we will be disciplined and rigorous about it.”

The company has unused credit lines of about 6 billion euros that it can earmark for acquisitions, said Chief Financial Officer Philippe Capron.

Other Operations

Levy told analysts on a conference call that Vivendi has “absolutely no intention” of raising its stake in NBC Universal. Vivendi holds 20 percent of NBC Universal, which owns the NBC television network, the Universal Pictures movie studio and theme parks. General Electric Co. owns the other 80 percent.

“Our strategy is to consider this asset as non-core,” Levy said.

Activision Blizzard said on Aug. 5 its second-quarter profit rose sevenfold on new sales from its merger with Vivendi’s games division in July 2008. Sales at Activision soared with the addition of subscribers to “World of Warcraft,” a multiplayer online title that was part of Vivendi’s games division.

Ebita at Activision rose more than four-fold in the quarter to 195 million euros, while sales tripled to 762 million euros.

Vivendi today said revenue was also lifted by a stronger performance at its French mobile-phone and pay-television services.

Universal Music, SFR

At SFR, France’s second-largest mobile-phone operator and Vivendi’s largest unit by earnings and sales, revenue rose to 3.11 billion euros from 2.99 billion euros. Ebita slid 4.2 percent to 686 million euros.

Pay-TV unit Canal+ Group’s revenue was little changed at 1.14 billion euros.

Revenue at Universal Music, whose artists include U2 and Lady Gaga, fell to 983 million euros from 1.01 billion euros. Ebita at the unit slipped 36 percent to 101 million euros.

To contact the reporter on this story: Kristen Schweizer at kschweizer1@bloomberg.net

Last Updated: September 1, 2009 13:00 EDT