Vodafone Group trumpeted its return to organic revenue and EBITDA growth for the first time since 2008, although its reported numbers were hit by foreign exchange movements.

In a statement outlining its full year results to end March 2016, chief executive Vittorio Colao said the company had concluded its Project Spring investment programme.

“This has transformed the quality of our technology, enhancing our customers’ experience and enabling us to expand our enterprise services,” he said.

The company has 46.8 million 4G customers across 21 countries. Some 16.7 million were added in the second half of the financial year.

“Although take-up continues to be rapid, still only 27 per cent of our European customer base is taking a 4G service, providing us with a very substantial opportunity for future growth,” the company said.

Vodafone has not hit its 4G coverage target of 90 per cent (it stands at 87 per cent), due primarily to rollout delays in the UK and Germany.

It also noted that in future, “cloud-based technologies will be the key enablers of our strategy, delivering large cost savings and increased agility”.

Challenges
But it was not all positive, particularly for the UK, where it noted “operational challenges following a business system migration” which led to higher churn.

Services to businesses comprise 27.7 per cent of group service revenue, and 32.7 per cent in Europe. “Our relationships with business customers are evolving, expanding from traditional mobile voice and data services to embrace total communications, IoT, Cloud & Hosting and IP-VPN provision,” it said.

Group EBITDA of £11.6 billion was up 2.7 per cent on an organic basis (down 2.5 per cent reported), on revenue of £41 billion, up 2.3 percent (down 3.0 per cent on a reported basis).

Improving organic service revenue growth benefited from “a leap-year effect and certain accounting reclassifications”, with the European market showing stabilisation toward the end of the year and Africa, Middle East and Asia Pacific offering continued growth.

Organic service revenue for Europe decreased by 0.6 per cent year-on-year, although Q4 saw growth of 0.5 per cent, as Germany and Italy returned to growth. Declines in mobile service revenue contrasted with fixed-line growth, as the group ramps its activities in this area.

Organic service revenue grew 6.9 per cent in APAC, with Vodacom, Turkey and Egypt having strong growth, while India suffered from regulatory impacts and price competitions (albeit still growing).

For the full year, the company reported a loss attributable to shareholders of £3.8 billion, compared with a prior-year profit of £5.9 billion. It saw a large tax charge in Luxembourg this year, which last year provided a large credit.