Vodafone shares were down 0.1% to 128.8p in early morning trading on Monday, after the telecommunications group reported a 2.5% service revenue growth in Q1 2023 from 2% in Q4 2022.
The company announced a service revenue fall of 0.5% in Germany, its largest market, against 0.8% in the previous financial term, reflecting the impact of the new Telecommunications Act.
Vodafone confirmed its European growth was supported by growth acceleration in the UK, with a 0.7% Europe Consumer contract mobile ARPU growth and 215,000 mobile contract customers added against 72,000 broadband customers lost in the period.
The firm highlighted a total service revenue of €9.5 billion from €9.3 in Q4 2022, of which €2.8 billion was linked to German business operations.
The group reported €1.7 billion in other revenue across the period, remaining mostly flat in Q1 2023 compared to Q4 2022.
Vodafone highlighted a total revenue of €11.2 billion over Q1 from €11.1 billion, representing a reported increase of 1.6% and an organic growth of 2.7%.
The telecommunications firm added its 1.7% business service revenue climb was supported by higher roaming and digital services revenue.
Meanwhile, its growth in Africa was supported by data revenue and financial services growth as its M-Pesa customer base rose to almost 50 million over the term.
The company added its service revenue in Turkey soared 35.8% as a result of higher inflation, impacting group service revenue growth by an additional 0.3%.
Vodafone confirmed it was on track to deliver according to its FY 2023 guidance, with its adjusted EBITDAaL anticipated to hit between €15-€15.5 billion, alongside an adjusted FCF of €5.3 billion.
“We have executed in line with our expectations, delivered another quarter of growth in both Europe and Africa, and seen an acceleration in business growth. Whilst we are not immune to the current macroeconomic challenges, we’re on track to deliver financial results for the year in line with our guidance,” said Vodafone CEO Nick Read.
“Our near-term focus on our operational and portfolio priorities remains unchanged. We’ve made good progress towards stabilising our commercial performance in Germany, and we continue to actively pursue opportunities with Vantage Towers and to strengthen our market positions in Europe.”
