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Vodafone Group Public Limited Management Discusses Q1 2013 Results - Interim Management Statement Call Transcript

So let me start on Slide 3, highlights of the quarter. Group service revenue grew 0.6%, which is just over 2% excluding MTRs. This growth is slightly less than the previous quarter due firstly to the boost in the prior quarter from the extra day in this leap year. This was roughly 1%, as well as continuing difficult conditions in a number of our European markets, offset by strong momentum from our AMAP region. Data grew by 17% driven by the increase in smartphone penetration, which is now nearly 29% in Europe.

In enterprise, growth slowed this quarter to 0.1% as competitive and macro pressures in Europe deteriorated, offset by accelerating growth from AMAP. We continue to see a healthy demand for enterprise services in fixed and data, and our VGE business continues to grow strongly. In Verizon Wireless, service revenue grew over 8% during the quarter, and the results they reported yesterday continue to highlight their very strong wireless performance and cash flow generation.

We also continue to generate strong cash flows. Today, we reported GBP 0.9 billion of free cash flow for the quarter, which has contributed to the lower net debt of GBP 22.7 billion. We are now very close to completing the GBP 6.8 billion share buyback program.

Finally, we have made a number of moves during the quarter to enhance our network and build our business. We have announced the acquisitions of fixed line assets in the U.K. and New Zealand and signed or extended a number of network sharing agreements in Europe and Australia. Vittorio will touch on these later.

On to Slide 4. Here you can see our regional performance for the quarter. Europe declined 1.6% on an organic basis. However, once we remove the impact of regulated voice termination rate cuts, Europe was flat. Some of our markets in Europe remain very challenging, and in particular, we saw a deterioration of trends in Italy during the quarter, which I will explore in more detail shortly. In AMAP, growth of 6.1% increases to 7.9% when the MTR impact is excluded. Momentum in AMAP continues to come from growth in customers and data.

Stock quotes in this article: VOD 

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