Mobile giant Vodafone today doubled full-year growth forecasts, boosted by a strong roll-out of Internet of Things (IoT) services and taking the knife to costs.
The firm's shares jumped over four per cent as markets opened.
In its half-year announcement, Vodafone said group revenue had fallen 4.1 per cent from €24.1bn (£21.6bn) to €23.1bn, though this was primarily as a result of the sale of the firm's Dutch arm.
Operating profit rose 32.5 per cent, from €1.5bn to €2.1bn.
Interim dividend per share grew by 2.1 per cent to 4.84 cents.
Vodafone markedly reduced its net debt, falling 15.4 per cent to €32bn.
Full-year earnings growth was revised to 10 per cent from the previously guided four to eight per cent. This implies full-year earnings of between €14.75bn and €14.95bn.
Read more: Vodafone sells $1.2bn Indian towers business
Why it's interesting
News that earnings growth is likely to be substantially higher than previously guided is likely to be music to the ears of many Vodafone shareholders.
In the half-year, costs have been reduced across the board. Direct costs fell from €5.8bn to €5.3bn; customer costs were down from €5bn to €4.8bn; and operating expenses were lowered from €6.2bn to €5.6bn.
Meanwhile, the mobile giant appears to have drawn a line under its irksome investment into India. Yesterday, it announced it had sold its large mast joint venture. This followed agreeing on a deal at the start of the year to effectively selling its mobile operations in the country to rival Idea Cellular.
However, Vodafone boss Vittorio Colao continued to put a brave face on regarding India and his comments did not suggest he has given up on the country completely.
He said: "India competition remains intense... There are however signs of positive developments in the Indian market, with consolidation of smaller operators and recent price increases from the new entrant. We are making good progress in securing regulatory approvals for our merger with Idea Cellular and in monetising our tower assets."
What the company said
Colao added: “In the first half of the year we have maintained good commercial momentum.
"Revenue grew organically in the majority of our markets driven by mobile data and our continued success as Europe’s fastest growing broadband provider. Enterprise revenues continue to grow, led by our IoT, cloud and fixed services, and for the second year running we achieved an absolute reduction in our operating costs.
As a result, we are able to report a strong financial performance, with substantial EBITDA margin expansion and profit growth, and we are raising our financial outlook for the year. In
"In the second half of the year we will continue to implement our strategic initiatives, including fibre infrastructure expansion in Germany, Portugal and the UK; our entry into the consumer IoT market with the launch of “V by Vodafone”; and the ‘Digital Vodafone’ programme designed to enhance our customers’ experience, increasing revenues and cost efficiency."