The company revealed a 2.6 per cent fall in revenues for the year to the end of March to €43.8 billion (£37.6bn), although its acquisition of Liberty Global’s assets in Germany and the Czech Republic helped pre-tax profits soar from €795 million to €4.4bn.
Chief executive Nick Read said: “The world has changed. The pandemic has shown how critical connectivity and digital services are to society.
“Vodafone is strongly positioned and through increased investment, we are taking action now to ensure we play a leadership role and capture the opportunities that these changes create.
“The increased demand for our services supports our ambition to grow revenues and cash flow over the medium-term.
“We remain fully focused on driving shareholder returns through deleveraging, improving our return on capital, and a firm commitment to our dividend.”
In the UK revenues fell by 5.1 per cent to €6.15bn which the company blamed on the strong pound hitting its balance sheet.
Revenues from its mobile service here fell 3.3 per cent due to lower roaming and visitor numbers, it added.
With stores closed on UK high streets for vast swathes of the year, online sales soared by 39 per cent and the company said it enjoyed a strong boost from business demand as workers stayed at home, whilst iPhone sales were also strong.
During the year, Vodafone added 219,000 customers to its mobile phone services and its broadband services saw 192,000 net customer gains – taking the total to 911,000.
The company’s biggest market, Germany, which accounts for 31 per cent of total sales, saw more impressive results with revenues up 7.5 per cent, primarily due to the purchase of Liberty Global’s assets in the country.
Stripping out the Liberty gains, revenues grew 0.5 per cent on an organic basis with growth from business users during the lockdown offsetting a fall in tourist and roaming charges to customers.
Vodafone’s worst-performing market was in Italy, where revenues sunk 9.3 per cent, with bosses blaming this on price competition in the market and lower roaming charges.
Richard Flood, investment manager at wealth management firm Brewin Dolphin, said: “Vodafone’s results are slightly behind the market’s expectations, with lockdown in Europe still partly to blame.
“Although not a company to set the heart racing with excitement, Vodafone can continue to grow slowly and has a very attractive and well covered dividend, which is currently yielding 5.7 per cent.”
Richard Hunter, head of markets at Interactive Investor, noted: “These are not results to shoot the lights out, but there are signs of measured progress within an extremely competitive sector.
“There is certainly much to do for Vodafone, particularly in a notoriously competitive sector which can often simply come down to price in the mind of the consumer.
“The pandemic has had its own effect on revenues also, with an inevitable decline in visitor and roaming revenues, while handset sales have also suffered.”