Vodafone Group PLC (LSE:VOD) said it “can do better” as it held guidance after reporting a slowdown in revenue growth in quarter three.
The FTSE 100 listed company said it was continuing to target adjusted EBITDAaL of between €15.0bn to 15.2bn and adjusted free cash flow of around €5.1bn for the full year.
But, in the Q3 trading update, Margherita Della Valle, group chief executive said: "Although we're continuing to target our financial guidance for the year, the recent decline in revenue in Europe shows we can do better.”
She was commenting as the telco reported that group service revenues for the quarter were €9,520mln, up 1.8% on a like-for-like basis, but below the 2.5% growth seen in the previous quarter. On a reported basis the number was 1.3% lower on quarter two.
Total revenue for the quarter was €11,638mln, down 0.4% on a reported basis on the previous quarter, and 2.7% higher on an organic basis.
The slowdown in group service revenue growth from quarter two was driven by Europe where declines in Germany, Italy and Spain partially offset by good growth in UK and other European countries.
The quarterly trend was also impacted by lower roaming growth and phasing of business revenue in the fiscal year.
Germany service revenue declined by 1.8% on an organic basis compared to a 1.1% in quarter two largely reflecting customer losses related to the implementation of new sector legislation.
In the UK, service revenue increased by 5.3% compared to 6.9% in quarter two driven by good customer growth and price increases offset by lower roaming and visitor revenue growth, and ARPU (average revenue per user) dilution from retail price competition.
Vodafone Business service revenue growth of 2.4% was driven by its digital services.