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Earnings: Vodafone Reports Record Profits; Messaging And Data Revenues Up

image Vodafone (NYSE: VOD) chief Arun Sarin is exiting on a high note. The global telecom firm reported full-year profits of £6.66 billion ($13.2 billion), compared with a loss of £5.43 billion ($10.8 billion) a year earlier. Revenues rose 14.1 percent to £35.3 billion ($69.9 billion), boosted in part by emerging markets. Earnings before interest, tax, depreciation and amortisation (EBITDA) climbed to £13.2 billion pounds ($26.11 billion), topping analyst expectations of £13.1 billion ($25.9 billion) according to Reuters. Vodafone forecast group revenue of between £39.8 billion ($78.7 billion) to £40.7 billion ($80.5 billion), with adjusted operating profit of £11 billion ($21.8 billion) and £11.5 billion ($22.7 billion).

Additional Highlights:

— Says it remains “committed to our investment” in Verizon Wireless (NYSE: VZ), which “continues to perform well on all key metrics. Says US market “continues to be an important and attractive market.”

— Data revenue up 35.7 percent to £2.2 billion ($4.3 billion), rising from £1.4 billion ($2.7 billion) a year ago. Growth has been boosted by mobile PC connectivity devices (dongles) and streamlined service offerings.

— Messaging revenue was up 8.1 percent from last year, with revenues nearly double that of data revenue. In Europe, where messaging is particularly strong, the company earned £3.3 billion ($6.5 billion) in messaging revenue, compared to £1.8 billion ($3.6 billion) in data revenue. Outside of Europe, in Africa, Middle East and Asia Pacific regions, messaging revenue came in at £824 million ($1.6 billion), up from £667 million ($1.3 billion) a year ago. Data revenues totalled £359 million ($710 million), up from last year’s total of £138 million ($273 million).

Highlights from the Conference Call:

— Sarin quashed the notion that Vodafone would buy Chinese handset maker Huawei. “No, we’re not interested in buying a handset manufacturer such as Huawei, or any other one for that matter.”

— Incoming CEO Vittorio Colao (pictured, right)  fielded a question on Nokia (NYSE: NOK) services, and mostly sidestepped them, promising to make the “appropriate investments.” He added that Vodafone was “very keen to preserve a strong relationship with our customers,” and said they would keep investing in mobile data and mobile advertising—as these too fields are “going to be great.” Here’s the release on Sarin’s departure.

—Dongle penetration in Europe totals 2.2 million.

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May 27, 2008 6:30 AM ET
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Posted In: Money, Earnings, Companies, Vodafone, arun sarin

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