Universal has been sold to NBC

Operating profit rose 20% to 1.7bn euros (�1.2bn) in the first half of the year, as the firm's radical downsizing gets underway.

Despite the marked improvement, the firm is still reporting a net loss of 632m euros.

But the loss, while still significant, is tiny compared to the 12.3bn euros lost the previous year.

That loss added to the firm's 35bn euro debt mountain run up during a frenetic spending spree.

The acquisition spree has now turned into a season of sell-offs, in order to tackle the debt.

Investors cheer

Vivendi's former chief executive Jean Marie Messier, the man blamed for dragging the company into its current financial mess, has won a court battle to receive a 20.5m euro pay-off.

But the company's new management, headed by Jean-Rene Fourtou, resents paying money to the man who oversaw Vivendi's dramatic collapse and fought the pay-offs in court.

Mr Fourtou has now launched a sweeping programme of cost-cuts and sales, most notably a recent agreement to sell much of its showbusiness assets to US media network NBC.

Vivendi said that once the sale of its entertainment arm was complete its debt would fall to under 5bn euros by the end of next year.