Vodafone signals return to growth in service revenues

The Newbury-based operator reported a rise of 1.1 per cent to 10.6bn in the second quarter following further robust growth in emerging markets and strong sales of smartphones in the UK.

Vodafone's domestic business delivered a third successive improvement in revenues trends and returned to year-on-year growth with a rise of 0.7 per cent to 1.19bn in quarter to June 30.

Chief executive Vittorio Colao said: "These are the first quarterly results to show service revenue growth since the global recession impacted.

"We have achieved these results through our continuing commercial approach in key European markets, focusing especially on data, and from strong growth in emerging markets."

At the start of this year, Vodafone became the third network to muscle into the iPhone market in the UK.

Vodafone said revenues from data usage in the UK rose by 27.8 per cent due to higher take-up of mobile internet bundles and growth in its contract customer base. The rise in data revenues across the group was also ahead of expectations, according to Evolution Securities analyst Steve Malcolm.

He added: "We doubt Vodafone has significantly out-performed its competitors in any major market, but data trends and emerging market trends were, on the whole, positive."

n The telecoms watchdog yesterday said rivals should not be made to stump up higher charges to share the burden of filling BT's mammoth pension deficit.

Ofcom said it had not seen any compelling evidence that would justify changes to prices set for BT's wholesale Openreach service to take account of funding for its pension black hole, estimated at 7.5bn.

The regulator revealed last December it was looking at an option to make firms such as TalkTalk and BSkyB pay up to 4 per cent extra for using wholesale telephony from BT to help cover pension deficit payments.