Vodafone’s Q1 revenue grows as Europe sets down the road to recovery

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Vodafone’s report indicates the mobile operator exceeded expectations in the first-quarter service revenue on Friday. It opened more stores as tourism made a cautious return after the severe disruption caused by the pandemic last year. 

Nick Read, the CEO, said that the company returned to service revenue growth in Europe and Africa, reporting a 3.3% growth in service revenue.

Read said that the growth is broad-based within ‘both consumer and business segments’ with a majority of Vodafone’s markets contributing. The company’s shares were trading 2% higher in early deals on Friday, as revenue growth exceeded forecasts that set it at 1.4%.

Better figures than 2020

Read also reported that the company’s retail traffic was up 70% year-on-year but is still 40% below pre-pandemic levels. Roaming and visitor revenue contributed only some portion to the recovery, up 56% from 2020 numbers when pandemic restrictions shut down Europe.

That figure is still 54% lower than pre-COVID-19 levels.

Speaking to reporters about this, Read added that it was apparent to the company that “recovery was never going to be linear.” He continued to say that the company thinks September and the ‘back to school’ may prompt the environment into a ‘normalising’ but not ‘normal’ mode.

In other markets

The company reports that it maintained momentum in Germany, its biggest market, with growth going up 1.4% against 1.2% in Q4, while Spain and Britain returned to quarter-on-quarter growth, prompted by the eased COVID-19 restrictions.

Due to competition in Italy, the company saw a 3.6% decline in the country, which is better news, given that the previous quarter saw a 7.8% decline.

In Africa, its financial platform M-Pesa saw transactions go up 45% year-on-year, increasing growth further. The group added that it is on track to deliver a full year’s target of 15.0-15.4 billion euros in adjusted earnings, with at least 5.2 billion in free cash flow.