Vodafone's European Revenues Tumble But Group Holds Full Year Profit Forecast

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By Martin Baccardax | February 7, 2013 6:18 PM EST

Vodafone reported big declines in European revenues for its third quarter but said growth in emerging markets would keep full-year profit forecasts on track.

Service revenues across all of Vodafone's major European markets fell in the three months ending in December, the group's fiscal third quarter, the company said in a trading update published Thursday on its website. Group service revenue for the period fell 2.6 percent to £10.373bn ($16.3bn; €12bn).

However the group kept its full-year guidance for adjusted operating profit and free cash flow unchanged. 

"Our results continue to reflect very difficult market conditions in Europe," said CEO Vittorio Colao in the statement. "We are addressing this through firm actions on cost efficiency, and continuing to invest in areas of growth potential. We continue to make progress in our Vodafone 2015 strategy, with good revenue growth in data and emerging markets, the launch of LTE services in another four markets and the acquisition of new spectrum."

Spain and Italy saw declines of 11.3 percent and 13.8 percent respectively. Across southern Europe, group service revenues fell 11.9 percent to £2.34bn, while markets in northern Europe notched a 0.9 percent revenue decline to £4.837bn. UK service revenues fell 5.2 percent, the company said.

Growth in the group's Africa, Middle East and Asia Pacific operations, however, was a robust 2.7 percent, taking service revenues in that region to £3.147bn.

Vodafone shares rose 2.4 percent in early London trading to change hands at 174.5 pence each. The shares have risen 6.1 percent over the past month.

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