Bottom Line: An expensive world

VODAFONE'S ambitions beyond these shores carry a high price tag. Were it not for a pounds 13m loss from overseas operations, half-time pre-tax profits would have increased by 16.4 per cent rather than 8.9 per cent. But mobile telephony in Europe and the Asia Pacific region is the key to sustained strong earnings growth at Vodafone in the longer term, even though it is not enjoying the free ride it was given by the UK government.

Recent sharp movements in the Vodafone share price are down to the renewed frenzy of excitement among North American investors over the potential for telecommunications companies in the 'multimedia world'. But with sales growing at a cracking 22 per cent there is little to threaten a rating that, at 527p, stands at a 50 per cent premium to the market.