Sales of mobile and fixed-line broadband data services and
currency differences saved Vodafone's blushes as revenue from voice
traffic slid in the first quarter of 2009.
Reporting on
first quarter results this morning, Vodafone CEO Vittorio Colao
said data revenue was up 19% and fixed-line revenue was 7% ahead of
the comparative period, but overall results, excluding foreign
exchange and other accounting effects, were down 2.4%.
Group revenue rose 9.3% to £10.7bn, thanks to foreign exchange
benefits worth 8.6% and a 3.1% contribution from mergers and
acquisitions. Free cash flow improved 21% to £1.9bn, helping to cut
net debt to £31bn.
The firm added eight million new subscribers to bring its total
user base to 315 million. Colao said India and South Africa
continued to show good growth, but elsewhere the recession was
pushing subscribers into cheaper package deals.
"The group continued to deliver solid growth in mobile data and
fixed broadband," he said. Organic data revenue growth was 19.4%,
slightly lower than the previous quarter due to less data roaming
and enterprise activity. The group added more than 200,000 fixed
broadband customers in Europe; fixed line revenue grew at constant
exchange rates by 18.5% in Italy and 15.4% in Spain. Europe's
enterprise revenue declined, reflecting the economic pressure on
business customers, he said.
Colao confirmed the outlook presented in May, saying growth in
free cash flow allowed it to continue investing in growth areas
such as mobile data, fixed broadband and India.
He warned that second quarter results in UK would be hurt by
lower mobile termination rates (the money received from third party
network operators for connecting their customers to Vodafone
subscribers).