The group reported an adjusted operating profit of £11.5 billion for the year to 31 March, up 2.5 per cent on a year earlier, on revenues 1.2 per cent higher at £46.4bn.
However, faced with reduced customer spending across southern Europe, it wrote down the value of its businesses in the region by £4bn. With trading in Italy and Spain showing little sign of improvement, it now expects organic service revenue growth in 2013 to be slightly below its previous medium-term target range of 1 to 4 per cent.
Jonathan Jackson, head of equities at Killik & Co, said the sales forecast was “disappointing” but he pointed out that adjusted operating profits are expected to come in at between £11.1bn and £11.9bn next year as continued growth at its Verizon Wireless joint venture in the US offsets the weaker euro.
Vodafone, which has launched a £1bn bid for Cable & Wireless Worldwide, said 27 per cent of European customers were now using smartphones, up from 18.6 per cent a year ago.