Vodafone's annual profits decline
The world's largest mobile operator hit by Europe's economy woes.
The Vodafone Group, the world's largest mobile operator by revenue, has posted a pre-tax profit of £9.55bn for the fiscal year ended 31 March 2012, a decrease of 0.5 per cent compared to £9.5bn for the same period last year.
Profit after tax declined by 11 per cent to £7bn (2011: £7.87bn), while diluted earnings per share were 13.75p (2011: 15.11p). Operating profit was £11.18bn.
Earnings were hurt by higher taxes and flagging operations in Europe, as well as the sale of stakes in SoftBank Mobile in Japan, the French company SFR, China Mobile and Polkomtel in Poland.
Group revenue increased by 1.2 per cent to £46.42bn (2011: £45.88bn), while group EBITDA declined by 1.3 per cent to £14.5bn as revenue growth was offset by higher customer investment due to increased smartphone penetration.
Verizon Wireless, the company’s 45 per cent-owned associate in the US, combined continued good revenue growth with substantial cash flow.
In the major emerging markets, Vodafone – via the pan-African Vodacom, operations in India and Turkey – saw year-on-year organic service revenue growth of 7.1 per cent, 19.5 per cent and 25.1 per cent, respectively.
Vittorio Colao, group chief executive of Vodafone, said:
Our focus on the key growth areas of data, emerging markets and enterprise is positioning us well in a difficult macroeconomic environment. Our commercial performance and our ability to leverage scale continue to be strong, enabling us to gain or hold market share in most of our key markets, and reduce the rate of margin decline. Our robust cash generation and the dividend received from Verizon Wireless have enabled us to translate this operational success into good returns for shareholders.
Our goal over the next three years is to continue to strengthen our technology and commercial platforms through reliable and secure high speed data networks, significantly enhanced customer service across all channels, and improved data pricing models, to enrich customers' experience and maximise our share of value in the markets in which we operate.
For the 2013 financial year, the company expects operating profit to be in the range of £11.1bn to £11.9bn, reflecting the weaker euro offset by continued profit growth from Verizon Wireless.
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