Vodafone yesterday showed there is no let-up in the financial woes in southern Europe as it wrote off £5.9bn on the value of its businesses in Spain and Italy, tipping the mobiles giant into a half-year loss of £492m.
This is just the latest huge impairment taken by Vodafone, which has had to write off an astonishing £59.1bn on a range of businesses since 2006, starting with a £23.5bn hit on the acquisition of Germany's Mannesmann.
Vodafone's latest write-off follows a £4bn impairment six months ago on Spain, Italy, Portugal and Greece.
Andy Halford, the chief financial officer, said he had to make these write-offs because of economic conditions in these countries and falling interest rates, which depress valuations.
"The accounting rules require that we look each half-year at the value of the various assets we hold," said Mr Halford, pointing out that these are "non-cash" impairments mostly relating to acquisitions which were made at the height of the telecoms bubble a decade ago.
Vodafone said that since chief executive Vittorio Colao took over in 2008, the group will have returned £33.5bn to shareholders through dividends and share buybacks, while writing off £24bn.
Mr Colao said a 7 per cent hike in the half-year dividend and another special payout from its stake in the United States carrier Verizon showed that Vodafone remained "very good" for shareholders.
The group's half-year sales slipped 0.4 per cent to £21.78bn, but revenues fell faster in the second quarter, with southern Europe taking a big hit, and even the UK struggling. The shares fell 4.1p to 162p.
Mr Colao said Vodafone was in transition as revenue from data usage on smartphones should start to outpace the fall in voice calls. He is now offering unlimited voice calls and texts across Europe to woo customers, after launching in the UK in September. "We continue to grow nice parts of the business," he added, referring also to corporate customers and emerging markets.