Vodafone gains after FQ1 report; Asia grows, Europe declines


On an organic basis (backs out forex and M&A), Vodafone's (VOD +2.6%) service revenue fell 4.2% Y/Y in FQ1 to £9.45B ($16.01B), a slightly bigger decline than FQ4's 3.8%.

European service revenue fell 7.9%, while all other markets grew 4.7%. However, the latter was down double-digits if forex is accounted for; weak Indian, Turkish, and South African currencies were responsible.

Vodafone's European mobile sub base fell by 1.77M to 127.1M - 878K subs were lost in Italy, 366K in Germany, and 236K in Spain. 80K were added in the U.K. With sub losses, declining voice/text revenue, and termination fee rate cuts taking a toll, service revenue fell 16.1% in Italy, 15.3% in Spain, 4.9% in Germany, and 3.2% in the U.K.

Mobile subs in all other markets grew by 6.37M to 303.7M (166.6M in India). 3.3M subs were added in India, and 3M by the African Vodacom unit. Service revenue grew 10.3% in India, and was flat in Vodacom markets (hurt by South African termination fee cuts). Europe is still 68% of service revenue.

£1.87B was spent on capex (£600M related to Project Spring), leading free cash flow to total -£582M. Net debt grew by £400M to £14.1B ($23.9B).

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Comments (2)
  • Just Some Guy
    , contributor
    Comments (2500) | Send Message
     
    Who are they losing subscribers to?
    25 Jul 2014, 12:32 PM Reply Like
  • Veritas1010
    , contributor
    Comments (3346) | Send Message
     
    TEF for one, and a bevy of lower cost euro providers.
    25 Jul 2014, 08:25 PM Reply Like
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