Vodafone has reported a 15.6% rise in full year revenues to reach £41.02 billion (US$62.47 billion), although profits dropped to £3.08 billion (US$4.7 billion) from £6.76 billion (US$10.3 billion) a year ago, largely due to a write down of the Spanish and Turkish networks. Ignoring the impairment charges, the groups adjusted operating profit was up 16.7% to £11.8 billion. Group EBITDA up 10.0% to £14.5 billion.
Net debt has increased to £34 billion (US$51.8 billion), primarily as a result of foreign currency movements. The company recorded impairment losses in relation to operations in Spain (£3.4 billion), Turkey (£2.25 billion) and Ghana (£250 million).
The proportionate mobile customer base stood at 303 million at 31 March 2009.
Vittorio Colao, Chief Executive, commented: "These results demonstrate the impact of the early actions we took to address the current economic conditions and highlight the benefits of our geographic diversity. The business continues to generate cash strongly and we have made good progress in implementing the strategy announced in November."
As expected, the company has accelerated its £1 billion cost reduction programme. In the 2009 financial year, the firm achieved approximately £200 million of cost savings, which were partially offset by restructuring charges. Vodafone now intends to deliver at least 65% of the total programme in the 2010 financial year, ahead of plan.
The company also benefited by £767 million following the resolution of long standing tax issues relating to the Group’s acquisition and subsequent restructuring of the Mannesmann Group.
Revenue in Europe declined by 2.1% on an organic basis, as benefits from new tariffs and promotions and a strong performance in data revenue were more than offset by the impact of the deteriorating European economy on voice and messaging revenue, including from roaming, usage growth, ongoing competitive pricing pressures and lower termination rates.
In Africa and Central Europe, revenue grew by 3.9% on an organic basis, with double digit revenue growth in Vodacom being offset by weakening trends in Turkey and Romania. Benefits from the increase in the average customer base were partially offset by both weaker economic conditions in the more mature markets in Central Europe and the impact of termination rate cuts.
In Asia Pacific and Middle East, revenue grew by 19% on a pro forma basis including India, a result of the rise in the average customer base, although revenue growth has slowed, primarily as a result of stronger competition coupled with maturing market conditions.
Look ahead, the company expects revenues and adjusted operating profits for 2009/10 to be flat, in line with the 2008/9 results, although free cash flow is expected to rise. The company also warned that it expects prospects for its Turkish network to be "challenging".
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