Vodafone makes stg£6bn write-down over tough market conditions in Southern Europe

13 Nov 2012

Vodafone Group has incurred a total impairment charge of stg£5.9bn because of tough market conditions in Spain and Italy, the company said on the release of its half-year 2012 results.

Group revenue was up 7.2pc to stg£21.7bn but because of troubled market conditions in Southern Europe, where service revenues were down 18.1pc to stg£4.9bn, the group reported an overall loss of stg£1.8bn for the first half of 2012.

“We have continued to make progress on our strategic priorities over the last six months, with good growth in data and emerging markets in particular,” CEO Vittorio Calao said.

“In the short-term, however, our results reflect tougher market conditions, mainly in Southern Europe.

“We remain very positive about the longer-term opportunities, and our Vodafone 2015 strategy reflects our confidence in the future. This is based on a new strategic approach to our consumer offer and pricing in Europe now being rolled out, an increasing focus on unified communications in enterprise, and an attractive and growing exposure to emerging markets,” Calao said.

Smartphones and acquisitions drive Vodafone performance in Ireland

In Ireland, Vodafone said smartphones and data usage drove growth for the company, with the number of customers using smartphones on the network increasing 6.7pc to 877,600 users – 43.4pc of its total base.

As of the quarter ending 30 September, Vodafone Ireland’s contract base stood at 760,600, up 1.1pc.

Fixed-line voice and broadband subscriptions were flat at 242,000 at the end of the quarter.

During the quarter, Vodafone Ireland completed its acquisition of Complete Telecom, which will enhance its ability to provide enterprise and unified communications solutions.

Vodafone’s previous acquisition of networks player Infusion contributed to a 30pc increase in the company’s revenues.

The company says it intends to establish a new dedicated enterprise solutions unit to focus on the business market in Ireland.

John Kennedy is a journalist who served as editor of Silicon Republic for 17 years