Shares of Vodafone (VOD.L) rose on Monday after the mobile phone giant posted quarterly growth in its services revenue, driven by sales growth in the UK that offset a turnaround in its German market .
Shares of telecommunications group FTSE 100 (^FTSE) gained as much as 0.2% in mid-morning trading in London.
“Vodafone’s share price continues to have all the vitality of a beached whale, having struggled to make meaningful progress for more than a decade,” said Russ Mould, chief investment officer at AJ Bell.
Europe’s biggest broadband provider reported higher sales in the first quarter as price increases helped offset weak trading in its biggest market, Germany.
The phone company said it was on track to provide its full-year guidance, expecting adjusted profit to be between 15 and 15.5 billion euros before interest, impairment, taxes and depreciation.
Total revenue rose 1.6% in the three months to June 30 to €11.3bn ($11.6bn, £9.6bn), from €11.1bn. euros a year earlier, with service revenues up 2.5%.
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It suffered a 0.5% drop in service revenue in Germany, with its TV customer base falling by 79,000 and a drop of 34,000 across its broadband service.
However, this was countered by domestic growth, with services revenue jumping 6.5% across the UK, from 2% in the previous quarter.
Vodafone said the national improvement was partly due to annual price increases of around 8% to 9% (£1 or £2) for each customer, adding that it had not seen an increase” significant” in the number of customers leaving the group as it added 18,000 contracts. customers of the quarter.
Mold added: “Vodafone’s latest business update lacked the hoped-for major acquisition that could have really rocked the dial.
“Instead, the company saw service revenues in its largest market, Germany, decline as regulatory changes led to losses in its television and broadband businesses.
“This has been offset by rising prices in the UK and the return of roaming charges as Britons go on holiday but no longer take their mobile data plan with them.”
Its business in inflation-hit Turkey also gave a boost, up 35.8% and adding 0.3 percentage points to the group’s total figures. Inflation in the country soared to 80% in July, the biggest annual increase since 1998.
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Nick Read, CEO of Vodafone, said: “While we are not immune to the current macroeconomic challenges, we are on track to deliver financial results for the year in line with our guidance. Our near-term focus on our operational and portfolio priorities remains unchanged.
“We have made good progress towards stabilizing our business performance in Germany, and we continue to actively pursue opportunities with Vantage towers and strengthen our market positions in Europe.”