Data revenues drive Vodafone growth

Vodafone hailed its success in boosting revenues from mobile data and emerging markets today as it reported profits at the top end of market hopes.

The mobile phone group’s benchmark figure of £11.5bn was up 2.5% on a year earlier but 2.4% lower when including currency changes and as it feels the impact of Europe’s debt crisis in a number of trading regions.

Vodafone said it capitalised on the proliferation of mobile devices and faster speeds to boost revenues from data by 22% in the year to March 31, representing 14.5% of the company’s £43bn in service revenues.

Smartphones are now used by 45% of its contract customers in Europe and a similar proportion of customers take integrated tariffs, which combine voice, SMS and data in one monthly charge.

Vodafone’s service revenues were 1.3% higher in the UK, up 2.7% in Germany and ahead 19.5% in India but this was offset by an 8% slump in Spain and a 1.9% drop in Italy as the economic crisis in southern Europe and rising unemployment hits demand.

The group wrote down the value of its businesses in southern Europe by £4bn in today’s results and said its revenues projections for this year would be slighly lower amid “increasingly challenging” conditions in Europe.

It expects adjusted profits to be in the region of £11.1bn and £11.9bn in the current year to March 31. Shares opened more than 1% higher today.

The group paid a special £2.2bn dividend in February, stemming from the resumption of dividends from its 45%-owned Verizon Wireless joint-venture in the US. Recent research showed it will supplant oil giant Shell as the UK’s top dividend payer in 2012.

More recently, it announced a £1bn bid for Cable & Wireless Worldwide, which would make it the UK’s second biggest telecoms operator, improve its network and allow it to make efficiency savings.