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Vodafone Sees Slower Growth

It also sets a big writedown.
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were lower Monday after the U.K.-based wireless company tamped down sales guidance for the fiscal year starting in April. It also previewed an enormous writedown related to new accounting rules.

Vodafone said it expects "comparable" sales for the coming year to rise by 5% to 6.5%, down from the 6% to 9% clip it sees in the year ending March 31, 2006.

The lower rate reflects an "increasingly intense competitive environment, continuing regulatory reductions in termination rates and the one-off beneficial impact in the year ending 31 March 2006 of the introduction of mobile to mobile termination rates in France."

In addition, Vodafone predicted a year-over-year decline in mobile EBITDA margins, excluding Japan, of about 1%, "as initiatives to drive further cost efficiencies are offset by pricing pressures, additional investments in customers and changes in termination rates." The company maintained guidance for EBITDA margins in Japan in the high teens.

Vodafone said its expectations for adjusted per-share earnings for the year ending in March 2006 remain "in line with current market expectations."

On Instinet, the shares were recently down 71 cents, or 3.5%, to $19.80.

Vodafone also expects to record a $48 billion charge to write down the value of goodwill acquired in various acquisitions. The charge reflects new European accounting rules and "a lower view of growth prospects, particularly in the medium- to long-term, than those it had used previously."