Rivals eat into Vodafone revenues

By HOLLY WILLIAMS
Published on 20/07/2012 10:18

Mobile phone giant Vodafone has revealed it is losing out to rivals offering “unlimited” deals as it posted a fall in UK revenues.

The group reported a 0.8 per cent drop in underlying UK revenues to £1.2 billion for the three months to 30 June, against growth of 1.1 per cent the previous quarter.

It blamed the fall on wider economic woes as customers cut down on their mobile phone usage and “significant” competition from rivals as they step up efforts to attract customers. A raft of mobile phone firms have been launching tariffs offering unlimited data, calls and texts in recent months.

The economic difficulties in Italy and Spain also took their toll, with sales down 7.7 per cent and 10 per cent respectively.

Slowing growth in its star performing markets such as India and Turkey added to the woes, with sales growth in India dropping from 21.1 per cent to 16.2 per cent.

Chief executive Vittorio Colao said the group would continue to keep a tight rein on costs.

He said: “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.”

The group is also hoping the smartphone boom will help provide a boost as customers snap up products such as Apple’s iPhone and the Samsung Galaxy.

Vodafone said it was sticking to its full year outlook despite the first quarter sales blow.