Vodafone squeezed as customers make better use of savings
Thursday 07 February 2013
Vodafone’s UK customers are spending less on their mobiles as they become more savvy about deals being offered and make sure they don’t breach the voice and text allowances in their contracts.
A sharper-than-expected decline in UK revenues and continued fall in economically crippled Spain and Italy saw Vodafone’s overall revenues slump a greater-than-expected 2.6% in the three months to December.
“Our results continue to reflect very difficult market conditions in Europe,” said chief executive Vittorio Colao. “The market in the UK is highly competitive.
“Our customers actually used more minutes in the last quarter but paid less for them. In the short-term that might not be good for our revenues but in the longer-term it is the right answer as we move people to Vodafone Red — our unlimited tariff.”
Colao said he would not comment on reports that the UK’s largest mobile company Everything Everywhere may be taken over with two rival private equity consortium lining up potential offers. However, he added: “Given how competitive the UK market is, I think it will have little effect who owns EE. But I watch events with interest.”
Vodafone left its forecasts for the year to March unchanged with operating profits between £11.1 billion and £11.9 billion.
In the latest quarter UK revenues dropped by 5.2% and even Germany saw a surprise 0.2% slip.
But in Italy revenues fell by 13.8% and in Spain by 11.3%. Emerging markets saw India grow by 9% and Turkey by 18.4%.
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