Vodafone posts soaring profits

2009-11-10 20:05

London - British mobile phone giant Vodafone said on Tuesday that net profits soared 125% during its first half, adding that it planned to double annual cost savings to £2bn.

Vodafone is SA mobile phone group Vodacom's parent company.

Profit after tax soared to £4.82bn in the six months to September 30 compared with £2.14bn in the equivalent period a year earlier, Vodafone said in a statement.

Net earnings were skewed largely owing to a huge write-off linked to its Turkish business a year earlier but a nine percent increase in group revenues to £21.8bn did contribute to the group's strong interim profits.

Operating profit rose 2.9% to £7.5bn during the first half, while revenues climbed 9.3% to £21.761bn.

"The group has performed in line with our expectations and we have made strong progress," Vodafone chief executive Vittorio Colao said in the earnings release.

"The £1bn cost reduction programme is expected to be delivered a year ahead of plan and we have extended this to a further £1bn of cost savings by 2012."

"At the same time, we have maintained our capital investment at £2.6bn in the first half, delivering further improvements in network quality and performance for our customers."

Vodafone, which employs around 10 000 people in Britain, had launched a major cost-cutting programme in November to reduce costs by £1.0bn by March 2011.

In late afternoon London trade, Vodafone's share price fell 1.96% to 135.25 pence on the FSTE 100 index, which in turn edged 0.05% higher.