Vodafone posts fall in Irish revenues to under €1bn

Vodafone Ireland CEO Anne O'Leary

Revenues at Vodafone’s Irish operations fell below €1bn in the group’s latest financial year, while its Irish mobile customer numbers dipped below the 2m mark.

Vodafone Ireland generated revenues of €996m for the 12 months to the end of March, down from €1.02bn a year earlier. It closed the year with 1.95m customers, down from 2.24m five years ago.

However, the communications giant’s Irish division saw adjusted operating profit rise from €25m to €55m, while its contract phone customers grew by almost 49,000 — an increase of almost 5%.

Vodafone Ireland chief executive Anne O’Leary said it had been “another year of operational progress” and that the business could continue to invest to make Ireland a “gigabit society”, referring to super-fast connectivity in everyday life. It committed €500m in March to improve services.

Vodafone’s share price rose more than 4% — to its highest level in 10 months — despite the group, which has operations in 26 countries, recording an overall annual loss of €6.1bn.

The group forecast a jump in cash generation this year, allowing it to reward shareholders with a higher dividend as it eases back on network investment and moves to solve problems in India where a price war has broken out.

The share price jump was a relief to investors after a tough year that saw the group dragged down by last year’s $5bn write-down on Vodafone India.

CEO Vittorio Colao said that excluding the Indian business, adjusted core earnings rose 5.8% to €14.1bn, beating market expectations and growing faster than revenues as the company improved efficiency.

He said earnings would grow between 4 and 8% this year up to €14.5bn — analysts had predicted €13.8bN — and it would generate about €5bn of cash, up from €4.1bn last year.

The company said the level of cash generation, combined with growth and a robust balance sheet enabled it to confirm a progressive dividend policy.

Mr Colao said: “We are getting into a space where we see a balance between our investment needs, rewarding our shareholders and having good enough cash flow to pay for spectrum. The broad direction is that these three things are becoming compatible.”

Mr Colao has been reshaping Vodafone with joint ventures to maximise profit and fight competition in markets like India. The carrier is vying with better-integrated rivals, leading to speculation it will be drawn into more deals, particularly in Europe.

Additional reporting: Reuters and Bloomberg


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