Vodafone Reiterates Outlook Despite Quarterly Revenue Dip

Paterniano Del Favero
Luglio 21, 2017

Shares in Vodafone climbed over 2% early on Friday (21 July), after the telecoms giant reported growth in the majority of its markets during the first quarter of its financial year.

Sales across the group fell 3.3 per cent to €11.47 billion (£10.2 billion) in the quarter to June 30, with revenue in India plummeting 13.9 per cent amid "continued price competition".

Vodafone sold its Netherlands subsidiary to T-Mobile Nederland late a year ago as a concession to European Union regulators in order to gain approval for a merger of its Dutch operations with Liberty Global's Netherlands cable company, Ziggo.

"Although competition in India remains intense, service revenues stabilised compared with the prior quarter". The company said Indian revenue stabilised quarter-on-quarter with share gains mitigating price declines.

Reported European revenue dropped 4.8% to EUR8.30 billion, but Vodafone said it saw "good momentum" in the region, with robust growth in Italy and Spain, similar underlying trends year-on-year in Germany and recovery in the UK. Vodafone said it saw strong growth in Turkey, but revenue in India was down 14% year-on-year.

"Rising competition has seen India hit a significant speedbump, jolting Vodafone to the extent that it took a multi-billion euro write-down and split the Indian operation from the wider group", said George Salmon, equity analyst at Hargreaves Lansdown.

Vodafone said it now has 83.5 million customers for 4G mobile date across its 22 countries, adding 8.8 million in the first quarter.

"We have made a good start to the year in Europe", Vodafone's chief executive Vittorio Colao commented in the statement, adding that the telco's performance gave the company "confidence in reiterating our outlook for the year".

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