Vodafone (LSE: VOD) (NASDAQ: VOD.US) released its interim management statement this morning, revealing that revenues have taken a hit across key markets in Europe.
The telecoms company reported that the Southern European countries of Italy and Spain saw year-on-year revenue decline of 17.6% and 10.6% respectively, while increased competition led to falls in the strongholds of the UK and Germany, down 4.5% and 5.1% in turn.
Even continued strong service revenue growth in emerging markets — Turkey 15.5%, India 13.8% — failed to prevent an organic loss of 3.5% in revenues including joint ventures.
However, Vodafone Red — its best ever value plans — made good headway, with mobile in-bundle customer revenue up 9.5%. It now has 5.2 million customers across 16 markets, while 4G services were launched in Spain, Australia and Czech Republic in the quarter, leading to group data usage rising 60%.
Chief executive Vittorio Colao commented:
“We have made a good start to the year in our areas of strategic focus: growth in emerging markets has accelerated, we now have over 5 million customers benefiting from Vodafone Red, and 4G is live in ten markets. In addition, the proposed acquisition of Kabel Deutschland will create an excellent platform for our unified communications strategy in our most important market.
“Although regulation, competitive pressures and weak economies, particularly in Southern Europe, continue to restrict revenue growth, we continue to lay strong foundations for the longer term.”
Onto the topic that shareholders may be most interested to hear about, Vodafone’s joint-venture Verizon Wireless reported continued strong service revenue, increasing 7.2%; unfortunately, though, there was no further news on Verizon Communications long-standing desire to purchase Vodafone’s 45% stake, despite Verizon last week reiterating its interest (but ruling out a merger).
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> Sam owns shares in Vodafone. The Motley Fool has recommended shares in Vodafone.