Vodafone edged its full-year outlook higher as growth in emerging markets and robust trading in northern Europe helped the world's largest mobile operator to post first-half results ahead of forecasts.
The results were boosted by strong growth in India and robust performances in Germany and Britain. Growth in Turkey inevitably slowed but remained solid.
However the group showed that it was still facing tough conditions in Italy, where organic service revenue fell three per cent in the second quarter from down 1.5 per cent in the first, and Spain, where it has struggled in a weak economy for several years.
Service revenue was slightly improved in Spain but it was still down 9.3 per cent in the second quarter from down 9.9 per cent in the first. The company took an impairment loss of £450m in relation to Vodafone Greece.
It moved its outlook for full-year adjusted operating profit to the top end of its range, predicting profits of between £11.4bn and £11.8bn compared with an earlier forecast of £11bn to £11.8bn.
"They're really great numbers," analyst Will Draper at Espirito Santo told Reuters. "Revenues are up 1 percent on the consensus and they've raised the operating guidance towards the top end of the range. So I think they're pretty bullet proof.
"Overall I would mention the organic service revenue growth at 1.3 per cent which was a long way better than consensus at 1.1 per cent and within that the really encouraging thing was Europe which was only down 1.2 per cent, compared to the forecast of minus 1.7."
The group posted first-half revenue up 4.1 per cent to £23.5bn and core earnings up 2.3 per cent to £7.5bn. Analysts had been expecting group revenue at £23.4bn and earnings at £7.4bn
On the key industry metric of group organic service revenue, which relates to the provision of ongoing services, the group was up 1.4 per cent in the first half and up 1.3 per cent in the second quarter.