Vodafone revenues fell to €11 billion during Q3, with ongoing challenges in Europe contributing to the 6.8 per cent drop in income.
The company also blamed the adoption of new reporting standards, the sale of its Qatar business and foreign exchange headwinds as contributory factors, although organic service revenue in Europe fell by 1.1 percent.
In the UK, revenues were down by 5.6 percent with Vodafone attributing much of this to a drag on handset financing. Without this impact, it reported that service revenues had risen by 0.9 percent, with an increase in fixed revenue helping to offset declines in mobile.
Vodafone added 46,000 fixed broadband customers during the period, bringing the total base to 525,000. Nearly two thirds of these customers also have a mobile contract with the operator, helping to drive loyalty.
Despite the figures, Vodafone CEO Group CEO says he is happy with the company’s progress. He cited low churn – partly because of Vodafone’s convergence strategy – and the implementation of the firm’s transformation strategy.
“We have executed at pace this quarter and have improved the consistency of our commercial performance,” he said. “Lower mobile contract churn across our markets and improved customer trends in Italy and Spain are encouraging, however these have not yet translated into our financial results, with a similar revenue trend in Europe to Q2.
“We enjoyed good growth across our emerging markets with the exception of South Africa, which was impacted by our pricing transformation initiatives and a challenging macroeconomic environment.
“Overall, this performance underpins our confidence in our full year guidance. We are moving to implement a radically simpler operating model and to accelerate our digital transformation, as demonstrated by the organisational changes we have announced in Spain and the UK.”
It was revealed earlier this week that Vodafone would commence a restructuring programme in the UK, with several smaller offices closed, and most roles moved to Newbury, London and Manchester. As many as 2,700 staff could be affected by the move, with Vodafone spending £10 million on its headquarters in Berkshire to accommodate the new employees.
Vodafone has also extended its network infrastructure sharing project with O2 to cover fibre and 5G. The CTIL joint-venture has been given greater responsibilities to allow it to seek new ways of monetising the assets, although it is unclear whether this could include a sale of masts.