Vodafone’s UK results for the 2009/10 financial year remained difficult, although emerging markets helped group numbers grow impressively.
In the UK, revenue was down from £5.4 billion to £5 billion. This included declining service revenue, down from £4.9 billion in the 2008/9 financial year to £4.7 billion in 209/10. Voice revenue shrunk from £3.2 billion to £2.7 billion, while messaging and data revenues increased from £939 million to £1 billion and from £470 million to £593 million respectively.
EBITDA was down in the UK from £1.4 billion to £1.1 billion in 2009/10. Adjusted operating profit more than halved from the £328 million recorded in 2008/09 to £155 million in 2009/2010.
Overall results for the latest financial year saw group service revenue increase by 8.9 per cent to £41.7 billion. Group revenue increased by 8.4 per cent from £41 billion to £44.5 billion, with operating profit up 61.9 per cent from £6 billion to £9.5 billion. Group pre-tax profit more than doubled from £4.2 billion to £8.7 billion, with profit growth for the 2009/10 financial year even bigger, increasing from £3 billion to £8.7 billion.
European service revenue declined by 3.5 per cent, with strong data and fixed line revenue growth offset by ongoing voice price reduction and lower volume growth in core voice products.
Service revenue in Asia Pacific and the Middle East increased by 9.8 per cent, with India generating quarter-on-quarter revenue growth. Vodafone said it has added 72 million customers since entering the Indian market in 2007 and has launched Indus Towers with more than 100,000 towers under management.
However, Vodafone said its Indian operation was affected by the introduction of six additional national mobile licenses one year after its entry into the market that resulted in intense price competition and has seen the company take a £2.3 billion impairment charge.
Africa and Central Europe service revenue declined by 1.2 per cent but fourth quarter service revenue increased by 2.4 per cent thanks to strong revenue growth in Turkey and at Vodacom.
Over the fourth quarter, there were notable growths in mobile customer numbers. Vodafone gained 9.5 million mobile customers in India, 1.3 million in Egypt, 282,000 in Italy and 164,000 in Turkey.
The reverse was true in the UK, where mobile customer numbers declined by 97,000, and in Germany where they were down by 87,000. Vodacom also lost 562,000 customers. Overall, mobile customer numbers across the group rose from 314 million to 324 million.
Vodafone said it had delivered positive results on its strategic priorities, with market share in India growing, data revenue exceeding £4 billion for the first time, more than 50 million active data users, strong broadband customer growth, positive uptake of its integrated services for enterprise customers and delivery of a £1 billion cost-saving programme ahead of schedule.
Vodafone announced in November that it was introducing a further £1 billion cost-saving programme to be delivered by the 2013 financial year to help offset inflationary and competitive pressures, and allow it to invest in revenue growth opportunities.
“Vodafone’s financial results exceeded our upgraded guidance on all measures,” said Vodafone chief executive Vittorio Colao.
“Revenue trends have improved again in Q4 driven by growth in mobile data and fixed broadband. Cost reduction targets were delivered ahead of schedule enabling commercial reinvestment to improve market share and further strengthen our technology platforms.”
Colao added that the company now generates a third of its service revenue from non-mobile voice products “reflecting the shift of Vodafone to a total communications provider.”
He said: “We are creating a stronger Vodafone, which is positioned to return to revenue growth during the 2011 financial year, as economic recovery should benefit our key markets.”