cellular-news [ ] 2010-07-23 ShareThis

Vodafone Revenues Rise - Plans Strategy Review

Vodafone has reported revenues increased by 4.8% to £11.3 billion (US$17.2 billion) and Group service revenue increased by 4.9% to £10.6 billion (US$16.2 billion). On an organic basis, service revenue increased by 1.1% - an improvement of 1.7 percentage points on the previous quarter - as each of the regions delivered improved service revenue trends.. The company doesn't issue a profit figure for the quarter. The company also confirmed that it will announce a shakeup of the company later this year to "accelerate our strategy to drive shareholder value and take advantage of the widespread adoption of data" Vittorio Colao, Chief Executive, commented: "These are the first quarterly results to show service revenue growth since the global recession impacted. We have achieved these results through our continuing commercial approach in key European markets, focusing especially on data, and from strong growth in emerging markets, with India now cash positive at an operating level and our highest ever quarterly revenue in Turkey. The financial outlook for the current year is confirmed." In Europe service revenue fell by 1.7%, a 0.7 percentage point improvement on the previous quarter. The northern European businesses experienced an improvement in economic conditions, whilst the southern European businesses continued to experience a weaker economic environment and poor consumer sentiment. In Africa and Central Europe service revenue grew 3.7%, a 1.3 percentage point improvement on the previous quarter, driven by strong performance in Turkey. In South Africa growth was at a similar level to the previous quarter. In central European markets operational trends improved despite fragile economic environments and significant reductions in local mobile termination rates. In Asia Pacific and Middle East service revenue increased by 10.5%, a 5.5 percentage point improvement on the previous quarter. The improvement was driven by continued strong customer growth and better usage trends in India where there have been no recent significant price reductions by market leaders. Outlook In the first quarter trading was consistent with management's expectations underlying the outlook statement for the current financial year. The EBITDA margin decline was also in line with management's expectations and the group continues to expect a full year EBITDA margin decline at a substantially lower rate than that experienced in the 2010 financial year, with the majority of the improvement occurring in the second half of the year.

World Cheapest Mobile Handset

Vodafone sets a world record to launch world’s cheapest mobile handset. During the Mobile World Congress in Barcelona, Vodafone unveiled the Vodafone 150 mobile phone which will sell for below $15 (£11). It’s really amazing just spending at below $15 everyone will be title-holder of a mobile handset compact with the most basic features.

Vodafone 150 is initially launched in India, Turkey and eight African countries including Lesotho, Kenya and Ghana- it is an emerging mobile market. The UN predicts that mobile ownership will reach 5bn in 2010, with most growth in the developing world. Vodafone has launched world’s two cheapest mobile Vodafone 150 and Vodafone 250 to increase its subscribers in the developing country. Vodafone 150 retail price is below $15 (£11) and Vodafone 250 (£20) retail price is below $20, depending on the local market.  Patrick Chomet, Vodafone’s Group Director of Terminals, said, “The cost of mobile handsets can be one of the most significant barriers for people in accessing and benefiting from the growing number of socially valuable mobile services. The lives of people who use these phones – the Vodafone 150 and Vodafone 250 – will be changed and improved as they become part of the mobile society.”

The Vodafone 150 and Vodafone 250 both offer excellent voice and SMS services, support for mobile payment services,  a flashlight, 100 contacts store capacity, one year replacement warranty and the other basic  features. The main differences between them being that the Vodafone 250′ have color screen, an FM radio with stereo headset support and lighter weight.

In India Vodafone 150 is sold at Rs. 700 with free Vodafone subscribe connection.

Vodafone signals frustration with Indian market

Vodafone Group Plc signalled increasing frustration with its key Indian unit on Tuesday, taking a charge of 2.3 billion pounds ($3.3 billion) due to fierce competition and rapidly escalating spectrum costs.
The world's second-largest mobile operator by revenue entered the Indian market in 2007 after beating rivals in a high-profile auction to make it the key territory in its faster growing emerging markets portfolio.
But the country has since handed out licences to many more operators, resulting in a fierce price war. A spectrum auction has gone far higher than any analyst had expected and major consolidation moves among operators are still not allowed.
The impairment charge on the value of the India assets, along with comments by Chief Executive Vittorio Colao that India's telecoms rules did not make sense, cast a shadow on otherwise solid full-year results.
"We have seen very strong price declines," Colao told reporters. "I don't think these rules (on consolidation and spectrum) make sense. India needs investment. India is a vast country with a vast population still not fully able to communicate.
"What India needs is investment and good technology and this will not come in an environment with too many operators and fragmentation of investment."
SingTel, southeast Asia's biggest telco, has also warned of slower than expected gains in India through its associate Bharti Airtel.
Vodafone is engaged in a spectrum auction in India which has exceeded most expectations. Bids for one set of nationwide third-generation (3G) mobile spectrum licences reached $3.54 billion on Monday, the 32nd day of the auction.
Most analysts had expected all-India spectrum to cost between $1.3 billion to $2 billion.
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The 3G spectrum would allow firms to offer high-speed Internet and other premium services in the highly competitive market, which would prove highly attractive to major operators.
But on top of the auction, the Indian telecoms regulator has called for mobile operators to pay a one-time fee for the 2G radio spectrum with high bandwidth which they won several years ago, a move that has drawn fierce criticism from all involved.
Vodafone Finance Director Andy Halford told reporters the impairment did not include any costs for a possible 2G bill and said the company expected to negotiate with the regulator.
Analysts said the impairment indicated Vodafone had overpaid and said problems in the market, where Vodafone has over 100 million customers, overshadowed improvements elsewhere.
Britain, Germany and Italy all showed signs of improvement while Turkey continued its turnaround and Africa performed strongly.
"Assuming Vodafone buys both Indian and German spectrum (at least $3.6 billion + 1 billion euros) the full-year 2011 dividend will be uncovered, with further spectrum auctions in full-year 2012 and governments becoming ever keener to maximize revenues," Morgan Stanley said in a note.
The Britain-based group, which has 341 million subscribers including its share of those from affiliates, said its 1 billion pound cost savings programme was delivered a year ahead of schedule and a new two-year programme designed to save a further 1 billion pounds would begin.
It reported yearly revenue and adjusted operating profit slightly ahead of expectations and core earnings in line with forecasts. Group revenue declined 2.3 percent to 44.5 billion pounds after excluding benefits from foreign exchange and acquisitions.
Core earnings or EBITDA reached 14.7 billion pounds in the year ended March 31 against an average forecast of 14.8 billion.
Free cash flow exceeded expectations by growing 26.5 percent, while capital investment was maintained at prior year levels. Vodafone said it would target dividend growth of 7 percent a year through the next three years.
"We are creating a stronger Vodafone, which is positioned to return to revenue growth during the 2011 financial year, as economic recovery should benefit our key markets," Colao said.
Shares in Vodafone were flat in early morning trading, compared with a FTSE 100 index up 0.6 percent.