Why Vodafone's Quarterly Statement Disappoints the Market
LONDON --Vodafone Group (ISE: VOD.L) dropped 4 pence, or 2%, this morning to 179 pence after it announced its interim management statement for the quarter ended June 30.
Group revenue at 10.8 billion pounds was a reported 7.7% down on the previous year and group service revenue (10.0 billion pounds) decreased by 8.1%. European service revenue fell 1.6% with the U.K. (0.8%), Italy (7.7%), and Spain (10%) all contributing to the decrease. Bright notes were provided by Germany with a rise in service revenue of 4.2% and the emerging markets of Turkey (18.7%) and India (16.2%).
Free cash flow also fell by 24.9% to 0.9 billion pounds after capital investment of 1.1 billion pounds.
Vittorio Colao, chief executive, commented:
Despite the difficult market conditions, particularly in southern Europe, we continue to make progress in the key areas of data, enterprise and emerging markets, while maintaining tight control of our cost base. We remain focused on driving through significant improvements to our customers' experience through our ongoing investment in our networks, stores and IT platforms.
The results underline the challenge faced by the telecoms companies in the current global climate, although in the United States, Verizon Wireless is performing well with service revenue growth of 8.2%
Vodafone is expected to complete the acquisition of Cable & Wireless Worldwide on July 27. The cash consideration for the acquisition of CWW is approximately 1,048 million pounds.
If you want to see if we rate telecoms as a top-performing sector, why not take a look at our completely free report "Top Sectors Of 2012" -- our guide to three favorable industries. This free report will be dispatched immediately to your inbox.
If you are new to investing and want to know more about how to start then we have a great report for you too "What Every New Investor Must Learn". It's free and will be with you right away.
Further Motley Fool investment opportunities
The article Why Vodafone's Quarterly Statement Disappoints the Market originally appeared on Fool.com.Barry does not own shares in any of the companies mentioned. The Motley Fool has adisclosure policy.
We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.