your money: A loada trouble for Voda; SHARES PLUMMET AS CHEAP CALLS HIT MOBILE PROFITS.
MORE than pounds 10billion was wiped off the value of Vodafone yesterday after bosses issued a shock profit warning.
Shares in the world's biggest mobile phone operator fell by close to 14 per cent as it admitted revenue would be at the "bottom end" of forecasts.
And departing boss Arun Sarin admitted the company would have to slash costs in order to even hit that target.
The news was a big surprise to City experts who believed people were so hooked on their mobiles that firms such as Voda would escape the slump.
But Sarin said: "We are pretty resilient, but we are not immune to the relatively severe downturn in the worldwide economic environment." He said the firm would continue "attacking costs" in an effort to offset the impact of falling sales.
While playing down the likely impact on jobs in the UK, Sarin admitted: "I'm not saying there is no possibility of people being affected here but we have a lot of contractors and they will go first and we will make sure that our employees are taken care of."
Vodafone's total revenue rose 1.2 per cent to almost pounds 10billion in the past three months as the company signed up an extra 8.5 million customers worldwide.
But the growth was mainly from new markets such as India with income in Europe falling 0.2 per cent.
In the UK, Voda signed an extra 863,000 users taking the total to 18.5 million. But the company felt the impact of fierce competition from rivals such as O2.
Total U K turnover rose 2.1 per cent thanks to a 31 per cent increase in use of data services such as mobile internet.
But income from voice calls fell 4.4 per cent as competition drove down charges by 9.2 per cent.
"Prices have been falling by 10 to 15 per cent a year for several years, giving UK customers better value for money and we expect that to continue," said Sarin.
269 million.. people worldwide are now Vodafone mobile customers, a rise of 8.5 million in past three months.
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|Publication:||The Mirror (London, England)|
|Date:||Jul 23, 2008|
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