Vodafone first-half revenue grows 9%

Poor results from Japan prevent greater growth

Vodafone Group reported an increase in revenue for the six months to September 30, although problems in Japan continued to weigh on its results, the company announced.

Total group revenue was £18.3 billion (NZ$46.3 billion), up from £16.7 billion in the same period last year. Revenue from mobile telecommunications accounted for £17.7 billion, up from £16.3 billion a year earlier.

Profit was £2.82 billion, down from £3.68 billion a year earlier, the company says.

Vodafone added 10 million subscribers over the six months, compared with 7.4 million new customers added last year. The operator now has a total of 171 million customers on its networks.

Vodafone registered 2.7 million 3G devices during the period, including 188,000 data cards. The operator counts 4.9 million 3G (third generation) devices in total, with the vast majority of those, 4.5 million, being consumer devices.

Vodafone Japan continues to be a drag on the group. Service revenue for Vodafone Japan decreased by 5%, although overall revenue there decreased by just 0.4% due to an increase in equipment revenue.

Vodafone continued to lose high-value customers in Japan because it lacks a competitive 3G offering in the market, it says. Competition there is only likely to increase after the government recently awarded two new spectrum licenses for mobile services expected to reach the market late next year. Still, Vodafone chief executive Arun Sarin says business will look up in Japan in 2007 as Vodafone continues to build out its 3G network.

However in New Zealand the cellphone giant is also losing market share. Vodafone's share of the mobile market now stands at 54%, down from 54.7% in June. Worse news came on the new subscriber front - Vodafone added only 27,000 for the quarter, against Telecom's 72,000.

However Vodafone's ARPU (average revenue per user) rose slightly, up to $140 per customer. Vodafone has also introduced new marketing and pricing schemes that it hopes will influence user numbers.

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