Emerging markets help offset Southern Europe weakness for Vodafone Group

17 May 2011

UK-based Vodafone Group has unveiled its results for the twelve months ending 31 March 2011, with the company revealing that consolidated group revenues rose in organic terms by 2.8% year-on-year to GBP45.884 billion (USD74.45 billion). Turnover was boosted by a strong performance from the group’s Africa, Middle East and Pacific (AMAP) subsidiaries, which collectively reported organic service revenue growth of 9.5% against the previous fiscal year to end the year with a turnover of GBP12.292 billion. This increase meanwhile helped to offset the slight decline registered by Vodafone’s European units, which altogether saw service revenue fall by 0.4% in organic terms; despite the drop European operations still accounted for the bulk of the group’s turnover, with European service revenues standing at GBP30.097 billion in FY2010/11. Further, Vodafone highlighted what it termed strong performance in key revenue growth areas, noting that turnover from data and fixed line services were up 26.4% and 5.2% respectively, while it also said that turnover from emerging markets – which it said included India, South Africa, Egypt, Turkey, Ghana, Qatar and Fiji – were up 11.8% against the corresponding period a year earlier.

Earnings before interest, tax, depreciation and amortisation (EBITDA) for the twelve-month period meanwhile were GBP14.670 billion, down 0.4% against the previous fiscal year, while the group EBITDA margin fell by 1.1 percentage points, which Vodafone said reflected ‘continued weakness across southern Europe, higher growth in lower margin markets, and the increased investment in migrating customers to higher value smartphones’. Performance across the group’s operating regions in terms of EBITDA echoed that of revenues, with Europe seeing a 3.7% y-o-y decline in the financial indicator, while the group’s AMAP regions reported a 7.5% increase.

In operational terms, at the end of March 2011 the Vodafone Group reported a proportionate mobile subscriber base of 347.708 million, up 1.99% y-o-y from the 341.145 million it had at end-March 2010. India remained the group’s largest unit in terms of customers, with 134.570 million at the end of the twelve-month period, up from 100.858 million a year earlier.

Commenting on the results, Vittorio Colao, Vodafone Group CEO, said: ‘The past year has seen further strong performances in our key revenue growth areas of data, emerging markets and enterprise, and we have gained or held market share in most of our key markets. Continuing network investment is an important differentiator for Vodafone, improving the customer experience and giving us leadership in smartphone penetration and in customer take up of data plans. We enter the new financial year well positioned to deliver further value to our shareholders.’

United Kingdom, Vodafone Group