Minute year-on-year quarterly organic service revenue growth gives Vodafone hope

Vodafone reported that in fiscal Q4 to March 31, 2015, the telco company returned to organic service revenue growth, albeit by a slim 0.1 percent, after 10 quarters of shrinkage. Weakness in Europe was offset by strong growth in its Africa, Middle East and Asia-Pacific (AMAP) region.

It comes as the telco reported a profit of £5.92 billion (US$9.22 billion), down 90 per cent year-on-year from £59.42 billion, on revenue from continuing operations of £42.23 billion, up 10.1 per cent year-on-year.

Its prior-year profit benefitted from a £48.12 billion gain from discontinued operations, related to its exit of the Verizon Wireless business in the US.

Profit from continuing operations of £5.86 billion was down from £11.31 billion, with the prior-year period benefitting from a significant income tax credit uplift.

Group service revenue of £38.5 billion was up 9.4 per cent year-on-year. Growth in Europe of 15 per cent to £25.97 billion was offset by a 0.8 per cent decline in AMAP to £12.04 billion although on an organic basis (taking into account M&A and foreign exchange changes) the picture was reversed, with a decline of 4.7 per cent in Europe, and an increase of 5.8 per cent in AMAP.

The telco has spent the last 12 months investing in speeding up its network and boosting coverage.

Vodafone remained cautious in its outlook, warning that it would continue to invest in its network this year. It forecast core earnings in the year ahead would be in the same region as this financial year, of between £11.5 billion and £12 billion.

On a group level the company has 20.2 million 4G subscribers in 18 markets.