Vodafone Group's revenue dropped 4.2 percent for its fiscal year to March 31, because of tough economic conditions, particularly in Southern Europe.
The operator's group revenue dropped to £44.4 billion (NZ $82.4 billion) for the year ended March 31, and net profit fell sharply from £7 billion to £673 million.
Behind those numbers are Vodafone's problems in Southern Europe where revenue was down by 16 percent. The effects of "severe macroeconomic weakness were intensified by strong competition," according to Vodafone . Revenue rose 2.7 percent in Northern and Central Europe but fell 2.9 percent in Africa, the Middle East and Asia-Pacific (AMAP).
In AMAP service revenue increased by 3.9 percent with continued growth in all markets apart from Australia and New Zealand.
“Australia continued to experience steep revenue declines on the back of ongoing service perception issues. During the year we launched 4G/LTE services in South Africa and New Zealand,” says the Vodafone CEO's statement.
Vodafone NZ lost 7000 connections in the last financial quarter, compared with 6000 in the previous quarter. But this was an improvement on the first two financial quarters which saw connection loses of 50,000 in Q2 and 41,000 in Q1.
Operators today struggling to balance falling revenue from voice and messaging services with growth in revenue from data. In Vodafone's case, revenue from the first two decreased by £3.8 billion, while data revenue grew by just £469 million.
Smartphone owners are the heaviest data users, and Vodafone reported that 54.8 percent of its European customers on a contract now have smartphones, up 9.9 percentage points year on year. At the same time, Vodafone also got a big boost from its fixed line business, where revenue grew by over £1 billion to £4.7 billion.
Vodafone is looking for growth in mobile data and fixed line services, as well as the enterprise sector and emerging markets. The operator has accelerated the integration of Cable & Wireless Worldwide and TelstraClear -- the two fixed line businesses Vodafone acquired during the year -- to help advance its enterprise and unified communications strategies, Vodafone said.
"Enterprise now represents 27.3 percent of Group service revenue and we have over 32 million mobile enterprise customers accounting for around eight percent of our total customer base," says report.
The tough economic climate in Southern Europe is likely to remain, but Vodafone is still bullish about its long-term prospects thanks to a growing appetite for high-speed data there and companies looking to make mobility a more integrated part of their IT infrastructure, it said.
- additional reporting by Computerworld NZ staff.