Vodafone Reports Slightly Better 3Q Sales

Vodafone's revenue increased 3% year over year on a reported basis, ahead of our full-year projection of 1.7%.

Allan C. Nichols, CFA 4 February, 2011 | 10:14AM
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Vodafone (VOD) reported fiscal third-quarter sales that were a bit better than our expectations. Revenue increased 3% year over year on a reported basis, ahead of our full-year projection of 1.7%. Reported revenue was below revenue on a constant currency basis as the pound strengthened versus the euro. These currency losses more than offset currency gains from other regions where the pound weakened. On a constant currency basis, Europe grew 1.8%, but on a reported basis it declined 1.9%. The United Kingdom was particularly strong, growing 7% from the year-ago period, while Spain continues to falter (down 7.4% in euro te

rms). The Africa, Middle East, and Asia Pacific region remains the growth driver. In local terms, India grew 16.7%, adding 8.7 million new subscribers in the quarter, Vodacom grew 5.6%, and the rest of the area grew 6.5%. Data revenue increased 27.2% in Europe, offsetting continued declines in voice revenue. Through the end of December, the firm had bought back £1.1 billion ($1.8 billion) worth of its stock. While free cash flow for the quarter was only £1.1 billion, down 39% from the year-ago period, management reaffirmed its full-year expectation of at least £6.5 billion.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar
Rating
Vodafone Group PLC72.12 GBX0.75Rating

About Author

Allan C. Nichols, CFA  is a senior stock analyst and international investing specialist with Morningstar.

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