Vodafone sales growth fails to stop stock drop
VODAFONE yesterday returned to growth for the first time in ten consecutive quarters, but investors were unimpressed, sending shares down 3.2 per cent on the day.
The telecoms giant reported earnings before interest, taxes, depreciation and amortisation (Ebitda) of £11.9bn for the year ending 31 March.
Analysts were less convinced at the firm’s strategy to adapt to industry change and consolidation.
“There is still little evidence that Vodafone has a business plan to encompass media and entertainment,” commented Panmure Gordon’s David Buik yesterday.
“It may well have paid a huge dividend last year on the sale of its stake in Verizon, but investors want to see more innovation and imaginative deals being implemented.”
The group has seen data use increase 80 per cent, thanks in large part to its strategy of bundling phone deals with other popular products, such as Netflix movie streaming and Spotify music streaming. Vodafone has 20.2m customers of its 4G service.
Group service revenue, the revenue from accounts, was up 0.1 per cent for the final three months of 2015.
Providing services to businesses now makes up 27 per cent of group service revenue, something that group chief executive Vittorio Colao described as “a very positive story”. However, enterprise revenue was down two per cent in the UK.
Vodafone shares closed at 226.6p.