The Financial Times (FT) reports that Vodafone’s shares fell almost 8 percent yesterday on investor fears its mobile operations in emerging markets will be hurt by the global economic downturn. Shares in the world’s largest operator by revenue closed £0.088 down, at £1.03, the lowest level since March 2003. In 2007-08, 37 percent of Vodafone’s operating profit came from emerging markets and the US. With an emerging market footprint that covers, amongst others, Egypt, Ghana and India, the operator is looking for growth in such regions as its European businesses are maturing. In July, the company announced that total full-year total revenue is likely to be around the bottom of its previously forecast range of £39.8 billion to £40.7 billion.
Meanwhile, rival operator Millicom International Cellular, a Luxembourg-based mobile operator with businesses in Africa, Asia and Latin America, did little to appease investor concerns yesterday by announcing it is to scale back its investment plans this year and next as the economic slowdown is expected to cut into growth. Although the company increased its 2008 annual capex budget to US$1.5 billion last quarter, it said it now expects to spend less than that and “substantially” less in 2009. The company also missed market expectations on revenue and EBITDA.
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