Vodafone Ireland customer revenues slip 6%

Vodafone Ireland said its average monthly revenue per user (ARPU) fell 6 per cent during the year to the end of March.

This brought average blended customer revenues to €39.10 per month, down from €41.60 a year earlier.

On average, Irish customers spoke for 246 minutes and sent 164 text messages per month during the last year, up 5.6 per cent and 18.4 per cent respectively on the totals for 2008.

This compares to Vodafone’s European average of 146 voice minutes and 79 text messages.

Overall Irish customers numbers fell 33,000 over the last year to 2.17 million with the company reporting 83,188 fixed-line voice and broadband customer numbers, a rise from 62,500 at the end of March 2008.

John Kent, chief financial officer Vodafone Ireland, said in a statement the company had reduced prices by “approximately 18 per cent” for Irish customers over the last year.

He attributed the reduction in customer numbers to the return home of some migrant workers and the impact of the recession.

Since November last year Vodafone said it had executed network sharing arrangements across Germany, Ireland, Spain and the UK.

The company said "both Greece and Ireland were impacted by deteriorating market environments, which worsened in the fourth quarter, and substantial price reductions in prepaid tariffs . . "

Its parent Vodafone Group said today it would accelerate cost cutting plans after forecasting profits would be flat at best in the coming year and announcing a £5.9 billion impairment charge.

Vodafone, which said the charges were due to problems in Spain and Turkey, also posted 2008-09 revenue, earnings and free cash flow in line with analyst forecasts.

Vodafone, like other mobile operators, has struggled from the recession in Spain where customers are looking for cheaper deals and it has also had to boost its network in Turkey to properly compete there.

On top of the two difficult markets, the British-based company said revenue from voice calls and messaging declined in its more mature regions, while roaming charges also fell due to lower business and leisure travel.

But the results showed signs of the company's new strategy coming through, with a good performance from India and Africa, data charges from customers surfing the Internet up 44 per cent and improved cost controls.

“We are confident that our strategy is appropriate for the current operating environment,” the group said.

In November, Vodafone said it would cut £1 billion of costs to maintain profit and boost free cash flow to cope with the expected challenging conditions.

Investors at the time welcomed its new focus on cost controls and on improving performance, instead of the previous plan of growth by acquisition.

Vodafone said today it would accelerate its cost cutting programme, with over 65 per cent to be achieved in the 2009-10 financial year. Chief executive Vittorio Colao told reporters they would look at increasing the scale of the plan.

Additional reporting Reuters