First half 2002 Lagardère results

In an economic environment reflecting continued weakness in advertising, Lagardère Media revenue grew strongly as a result of the quality of its media activities e.g., strong leading positions, solid global presence and a well balanced portfolio of cyclical and non cyclical businesses. In addition, on a comparable basis, all of the operating divisions reported a small improvement during the second quarter.

Total LAGARDERE SCA consolidated revenue grew by 3.1%.

_{(*) excluding changes in group structure and the effect of exchange rates.
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Excluding changes in group structure, “Lagardère Media” sales grew by 7%. Excluding, as well, the effects of exchange rates, the revenue climbed by 6.7% for the first half – versus 6.2% in the first quarter 2002. On an unadjusted basis, Lagardère Media revenues grew by 7.6%.

• Despite a retail distribution activity that remains effected by the drop-off in airport passenger traffic, Hachette Distribution Services recorded a double-digit growth rate in sales. This performance reflects the strong internal growth resulting from significant gains in new concessions as well as new distribution contracts.
  In addition, Hachette Distribution Services, on an unadjusted basis, is benefiting from the contribution of “Virgin” since its consolidation on August 1st, 2001.
• The Book division (Hachette Livre), which experienced a strong internal growth rate of above 6% during the 1st half of 2001, consolidated this performance. In fact, sales of the Book division, on a comparable basis, grew slightly during the first six months of 2002.
  Hachette Livre is also benefiting from the contribution of the English editor “Octopus” acquired last autumn and consolidated since January 1st, 2002.
• Hachette Filipacchi Médias continues to suffer from a difficult advertising market in the United States, where as the European and Japanese markets remain relatively stable. In total, on a comparable basis, the sales decline during the first half of 2002 is at the same level as the decline experienced during the full year 2001.
  Finally, the Hachette Filipacchi Médias revenue no longer includes the contribution of the French and Belgium printing activities which were deconsolidated as of December 31, 2001.
• In terms of advertising activity, the Radio business continues to be effected by high volatility as well as low visibility. Despite a difficult period to compare with, total Lagardere Active branch sales recorded a small increase during the first half of 2002 which reflects a growth in revenue during the second quarter versus a decline during the first quarter 2002. On an unadjusted basis, the published sales for the prior exercise include the period from October 2000 to March 2001 for Lagardere Active Broadcast while on a comparable basis, the period from January to June 2001 was used.

“Matra Automobile” sales declined by close to 10.9%. The Espace minivan, despite a continuing commercial success, is experiencing a progressive erosion of its market share that is typical for a model that has reached the end of its cycle. Still in a commercial launch phase, the new Avantime vehicle sales were also limited during the first five months of 2002 to the single V6 manual transmission model. This product range was broadened since June with the introduction of the 2.0T 16 V turbo model as well as the 2.2dCi diesel model. These last two models represent a significant portion of the potential Avantime market and should accelerate the sales in the future.

Revenue for the “EADS” line represent 15.10% of EADS sales.
In accordance with the French accounting standards used by Lagardère SCA, when hedging against exchange rate fluctuations, sales generated in foreign currencies are converted at a rate determined by the hedging instrument (rather than at the current exchange rate).
EADS sales were restated to conform to these standards. EADS revenue remains stable during the first half 2002 despite the decline, as expected, in the Space division. .