Vodafone records an increase in earnings in the quarter ending 30th June.
In the release this Friday, Vodafone reported its’ total organic service revenue for the past 3 months at €12.3 billion. The figure is 2.2% up from last quarter and beating analysts estimates.
The increase was driven by a 7.7% rise in earnings in Africa, the Middle East and the Asia Pacific region [AMAP]. In India Vodafone added 1.4 million mobile customers and reported on 3,300 new G3 sites which represents a rise to 96% population coverage in targeted urban areas. The group also expanded greatly into Turkey, Egypt and Ghana.
Organic based service growth, a metric which takes into account access charges and roaming fees but leaves out sales of handsets, is the companies preferred measure of sales success. However, strong organic growth this quarter was offset by an adverse impact from movement in the foreign exchange market, depressing revenues from growing markets such as Turkey, Egypt, India and South Africa.
Although regulatory pressures to lower roaming charges weighed down on European revenues, the company achieved organic service growth of 0.3% in the European market. Earnings grew by 1.6% in Germany and 1.2% in Italy as well as Spain but a contraction was reported in the Dutch market.
The group continues to struggle in the United Kingdom, where service revenues declines 3.2%. In March Vodafone became the most-criticised monthly mobile provider in the country, as the Financial Times reports. More than three times the average 10 complaints per 100,000 customers within the past three months of 2015 where recorded.
Vittorio Colao, Group Chief Executive, commented on the earnings report:
“We continued to make good progress during the first quarter. In Europe, our growth remains stable despite regulatory pressure on roaming revenue, with good performance in Germany, Spain and Italy while we are focused on improving our performance in the UK. Our growth momentum in AMAP remains strong, with excellent performance in South Africa, Turkey and Egypt and ongoing recovery in India. Customers in multiple markets are attracted by our ‘more-for-more’ commercial offerings of larger data bundles and extra services, while we are seeing continued success with our fixed broadband and enterprise strategies.’’