Business demand in Italy and less sharp falls in service revenues in Spain and Germany contributed too
Vodafone has reported better revenues than in the previous quarter, pushed up by increasing prices in the UK and better performances in Germany, Italy and Spain. This looks like a good start for the new group CEO, Margherita Della Valle (pictured), and the recovery plan she outlined at the last quarterly earnings report – her first as CEO.
Della Valle said organic service revenue had improved “across almost all of our markets”, as it reported a 3.7% first-quarter rise. “We’ve taken the first steps but of course we have much more still to do,” she told reporters.
Shares in Vodafone, which have fallen 43% in the last 12 months, rose 4.7% in early deals.
Germany, Vodafone’s biggest European market, doesn’t exactly make happy reading but Vodafone’s decline in service revenue more than halved since the last quarter, to 1.3%. Higher prices partially offset losing customers over the last 18 months and Della Valle said she expected “ongoing gradual improvement” in Germany.
UK booster
Service revenue in the UK grew 5.7% due to mobile price rises and an increase in fixed broadband subscribers of 42,000, raising its total base to 1.3 million customers. Vodafone UK’s CEO, Ahmed Essam, said the company is in discussion with the competition authorities and hopes to put the proposed merger to them in a few weeks’ time.
Business demand boosted the performance in Italy, along with reducing the fall in service revenue to 1.6%, from 2.7% in the previous quarter as its prepay base stabilised. The decline in the service revenues in Spain fell to 3.0%, down from 3.7% in the previous quarter. The CEO said although a strategic review of Spain, begun in May, had borne some fruit, the market needed structural change and Vodafone is considering “a range of options”.
Here is a summary of the results, provided by Vodafone.
Vodafone Group has appointed the former CFO of SAP, Luka Mucic, as its CFO. Della Valle vacated the role when she became CEO in April. Mucic will assume the position on 1 September. Della Valle said that with Vodafone’s increased focus on technology and AI, “bringing someone in with more direct experience of these developments” was important.