Vodafone Group plc. (Nasdaq: VOD) posted a more than doubling of net profit for the full year ended March 31, 2010, citing strong growth in Asia.
The world�s largest mobile telephone network operator said it generated net earnings of pounds8.65 billion (US$12.5 billion) for the year, up from pounds3.08 billion for the last year, on revenue of pounds44.5 billion, up 8.4C from last year�s revenue.
The company said strong growth in Asia offset declines in other regions where the company operates, with results varying widely between regions. India topped the company�s region of growth with a spike of 14.7% followed by a tie between Central Europe, Asia Pacific and Middle East at 9.8%.
Europe and Africa, however, fell 3.5% and 1.2%, respectively.
“European results suggest Vodafone is still losing share,” wrote UBS�s analyst Nick Lyall. Lyall rates the stock a �neutral.�
Fourth-quarter revenue rose 5% to pounds10.5 billion. The Newbury, England-based company didn�t report earnings broken up into quarters.
Vodafone�s 45% ownership in a U.S. joint venture with U.S.-based Verizon Wireless saw revenue rise 6% for the full year.
Included in the company�s quarterly results is an impairment charge of pounds2.3 billion, representing unexpected costs associated with new licenses secured in India.
Vodafone hiked its dividend payout by 7% to 8.31 pence (11.9 cents).
�Vodafone’s financial results exceeded our upgraded guidance on all measures,� said CEO Vittorio Colao. �Revenue trends improved again in the fourth quarter, driven by growth in mobile data and fixed broadband.�
Collins Stewart�s analyst Moten Singleton doesn�t see Vodafone�s financial results the same way, however.
�Organic revenue trends are barely improving and profitability is hardly moving despite the early completion of the 1 billion pounds cost-efficiency program,� said Singleton.
Details of full-year earnings include a reduction in impairment charges from pound5.9 billion to pounds2.1 billion (mostly from the Indian licensing issue); a steep drop in income taxes to pounds56 million from pounds1.1 billion; and pounds900 million in lower interest paid on debt outstanding, all of which, appear to support Singleton�s contention.
Where Vodafone sees India as a bright spot, Killik & Co. analyst Jonathan Jackson sees India as potential of further trouble for the company.
“The main negative in today’s statement is India where the group has suffered in an intensely competitive market,” said Jonathan Jackson, analyst at Killik & Co. �We believe investors should take advantage of the attractive dividend yield and wait for the group to unlock value from its 45% stake in Verizon Wireless and to achieve a turnaround of a difficult situation in India.�
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