Vodafone sees net profits tumble

[LONDON] Vodafone's annual net profits slumped dramatically but the performance was skewed by the sale of its stake in Verizon Wireless, the British company said on Tuesday.

Earnings after taxation collapsed to £5.76 billion (S$12 billion) in the year to March 31, the world's second-largest mobile operator said in a results statement.

That compared with an enormous net profit of £59.25 billion in the previous 2013/2014 financial year, when earnings were boosted by the sale of its 45 per cent stake in Verizon Wireless to Verizon for US$130 billion.

The deal - one of the biggest transactions in global corporate history - was agreed in September 2013 but completed in February 2014.

In a separate development last week, US telecoms giant Verizon announced plans to buy faded Internet pioneer AOL for US$4.4 billion.

Vodafone added on Tuesday that annual revenues rose 10.1 per cent to £42.2 billion, aided by its purchase of Spanish cable firm Ono and Kabel Deutschland (KDG), the largest cable operator in Germany.

Earnings before interest, tax, depreciation and amortisation (EBITDA) meanwhile gained 7.5 per cent to £11.9 billion.

The group also forecast that EBITDA would be in the range of £11.5 billion to £12.0 billion in the current 2015/2016 financial year.

That compared with analysts' consensus forecast of £11.9 billion, according to Bloomberg.

British group Vodafone is second only to China Mobile in terms of subscriber numbers.

AFP