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Vodafone reports increased 'minutes' usage

Vodafone - Results showed increased data usage
Vodafone - Results showed increased data usage

Vodafone customers used 1.9% more minutes in the second quarter of this year, quarter-on-quarter (an average of 267 minutes) while total voice calls grew 4.6% over the same period last year, the company has reported.

In an interim management statement for Q2 released today, Vodafone said that average revenue per user is down 6.3% on the same period last year, to just under €33 a month.

This is an increase of 1.9% on the Q1 figure, which the company attributed to greater data usage.

Vodafone's customers in Ireland sent 15% more messages in Q2 compared to the same period last year and, at an average of 224 messages sent per customer sent far more than the European average of 109.

1.49 million texts were sent by Vodafone Ireland customers in the quarter.

Vodafone has 2.2 million mobile customers in Ireland, the company said.

Including the Company's fixed line and DSL business, Vodafone total telecoms base was 2.4 million.

India and Turkey offset weak Europe for Vodafone

The Vodafone group reassured nervy investors today with results showing faster-growing markets such as India and Turkey helping the world's largest mobile company to withstand tough trading and regulation in Europe.

Sector analysts had been braced for a slew of bad results from European telecom companies, as regulatory changes eat into margins and consumers struggle, but they had looked to Vodafone and Telenor to shine due to their presence in the fast-growing emerging markets. Telenor did just that earlier this week.

'We have made a good start to the year, reporting robust results despite challenging macroeconomic conditions across southern European economies and the impact of cuts to mobile termination rates,' Vodafone chief executive Vittorio Colao said.

'With our broad geographical mix and improving market positions, we are well placed for the rest of the financial year,' he added.

The group posted first-quarter organic service revenue growth of 1.5%, down from the 2.5% growth recorded in the previous quarter but marginally ahead of forecasts. The overall performance was pulled lower by the 1.3% fall in European organic service revenue, which had accelerated from the fourth quarter, as Spain particularly dragged on its fortunes.

Vodafone said its presence in markets such as India would allow it to reiterate its outlook, which was previously stated as full-year adjusted operating profit in the range of £11-11.8 billion sterling.

Of the key markets, India posted organic service revenue growth of 16.8% and Turkey was up 32%. Germany was flat and Britain was up 1.7% after cuts to the price operators charge each other to connect calls cut in to margins.

Italy was down by 1.5%, although this was an improvement on the previous quarter, and Spain was down by 9.9% as intense competition, general economic weakness and high unemployment forced prices lower.

Shares in Vodafone have risen 12% in the last 12 months, since the company announced a plan to sell minority stakes in assets it did not control. Since then it has sold a financial holding in Japan and stakes in France, China and Poland.

With that completed, and some of the proceeds returned via a buy-back, analysts and investors are now turning to the 45% stake in Verizon Wireless and hoping for an announcement on when they will receive a dividend, which will strongly boost Vodafone's cash flow.

Vodafone said that revenues from the sale of data products which give access to the Internet, another key area for operators as competition pushes voice prices lower, was up by 24.5%. Overall, group revenue for the quarter to end June was at £11.7 billion.