Shareholder disquiet dampened by US results
Shareholders who had been putting the pressure on ceo Arun Sarin and agitating for a disposal of Vodafone’s interest in Verizon will have had their guns partially spike by this morning’s quarterly results from Vodfaone.
Of course, it may be fortuitous coincidence that Vodafone was able to hail its US business as one of the positives in the quarter to 31 December 2005 just as it was coming under pressure to dispose of it. On the other hand, decent performance from Verizon may convince those opposed to a global policy that the operator would be due a decent price for its 45% holding in Verizon.
Vodafone announced that it had added 7.1 million customers (well acutally it called them “proportionate organic net additions”), which is 30% more than the same period last year. Total additions were 8.3 million.
The operator also said it had sold 3.1 million 3G phones in hte final quarer, and had achieved revenue gorwth of 8.0% and 7% growth in service revenue year on year. However, “on a statutory basis”, ie. according to external principles, service revenue growth was only 4.3%, which will be a slight worry to Vodafone’s management.
All of this meant Vodafone is sticking to its predictions for the current year, which includes an EBITDA margin of less than 1%.
The dip in the rate of growth of service revenues was blamed on competition and lower termination rates in mature European markets including Germany, Italy and the UK. But Spain and the US performed well to offest this, the operator said.