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Vodafone reports rise in profits on emerging markets

Vodafone reports rise in profits on emerging markets
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First Published: Tue, May 19 2009. 10 20 PM IST
Updated: Tue, May 19 2009. 10 20 PM IST
London / New Delhi: Vodafone Group Plc., the world’s largest mobile-phone company, said full-year earnings rose as the pound weakened against the euro and revenue advanced in emerging markets such as India.
Earnings before interest, taxes, depreciation and amortization in the 12 months to March increased to 14.5 billion pounds, in line with analyst expectations, from £13.2 billion the previous year. Sales rose 16% to £41.02 billion, Vodafone said in a statement. The Newbury, UK-based company said it plans to accelerate its cost-cutting programme.
“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, chief executive officer Vittorio Colao said in the statement. “The business continues to generate cash strongly and we have made good progress in implementing the strategy announced in November.”
Vodafone expanded in emerging markets in the past two years, with acquisitions in Turkey, India and Ghana to make up for slower growth in Europe. The company said on Tuesday it’s bringing forward a £1 billion cost-cutting plan and will invest in revenue growth opportunities.
It now aims to achieve at least 65% of the total programme in the 2010 financial year, ahead of an initial target of 50%.
The company bought a 52% stake in Hutchison Essar Ltd, now India’s third-largest wireless provider, for $10.7 billion in May 2007, and purchased Turkey’s Telsim Mobil Telekomunikasyon Hizmetleri AS for $4.55 billion in 2006. On 28 May, Vodafone and a local partner said they would pay $2.1 billion for Qatar’s second wireless licence.
Vodafone Essar reported a growth of 33% in revenues to 2,604 million pounds in the year to 31 March from £1,822 million in the previous fiscal.
Vodafone Essar ended the financial year with 68.76 million wireless subscribers, 92.7% of them prepaid customers.
“During the 2009 financial year, we added 24.6 million customers in India and ended the year with the highest rate of net additions in the market,” Vodafone said.
Vodafone Essar reported a fall in average revenue per user from Rs350 per month to Rs274 per month.
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First Published: Tue, May 19 2009. 10 20 PM IST