Vodafone India profit up 14% on rising customer base

British telecom giant Vodafone Group on Tuesday posted a 14 percent growth in operating earnings from India’s business to 1.12 billion (about Rs 9,749 crore) for 2011-12 helped by rising customer base and strong growth in voice-call minutes.

The company’s earnings before interest, taxes, depreciation and amortisation (EBITDA), which excludes one-time effects, for the financial year ended March 31, rose to 1.12 billion from 985 million in 2010-11, Vodafone said in a statement.

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The group’s revenue from Indian operations surged to 4.26 billion in 2011-12, from 3.85 billion in the previous fiscal.

The telecom entity attributed the robust earnings from India’s operations to service revenue as well as higher customer base. The growth also came from mobile operators starting to charge for SMS termination during the second quarter of the 2012 financial year.

“Service revenue grew by 19.5 percent, driven by an 11.8 percent increase in the customer base, strong growth in incoming and outgoing voice minutes and 51.3 per cent growth in data revenue,” Vodafone said.

Although the market remains highly competitive, the effective rate per minute remained broadly stable during the year, it added.

“In India, pricing showed clear signs of stabilization after a prolonged price war,” Vodafone said.

As of March 21, 2012 the customer base had increased to 150.5 million in the country, with data customers totaling 35.4 million.

Vodafone said its adjusted operating profit from India business was 60 million in 12 months ended March 2012 as compared to 15 in the previous year.

Overall, Vodafone’s EBITDA dropped to 14.5 billion in 2011-12 from 14.7 billion a year earlier.

The group’s revenue for the year improved by 1.2 per cent to 46.4 billion mainly on account of contribution from key countries such as India and Turkey.

“Our focus on the key growth areas of data, emerging markets and enterprise is positioning us well in a difficult macroeconomic environment. Our commercial performance and our ability to leverage scale continue to be strong, enabling us to gain or hold market share in most of our key markets, and reduce the rate of margin decline,” Vodafone group chief executive Vittorio Colao said.

“Our robust cash generation and the dividend received from Verizon Wireless have enabled us to translate this operational success into good returns for shareholders,” he added.

Looking ahead, Vodafone expects fiscal 2013 adjusted operating profit in the range of 11.1-11.9 billion.

PTI