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Vodafone dials up profits, as CEO hangs up PDF Print E-mail
Wednesday, 28 May 2008

AFP, LONDON - Mobile phone giant Vodafone said on Tuesday that it swung into profit during 2007-08 and that its chief executive Arun Sarin would shortly step down after five years at the helm.

The British group said net profit stood at 6.66 billion pounds (8.35 billion euros, 13.16 billion dollars) in the year to March 31 as it increased its customer base in emerging markets across Asia and Africa.

Vodafone had posted a net loss of 5.426 billion pounds in 2006-07 owing to exceptional losses linked largely to its acquisition of German telecoms group Mannesmann in 2000.

Vodafone said on Tuesday that revenue jumped by 14.1 percent to 35.48 billion pounds in 2007-08.

"Our existing emerging market assets continue to perform well," Sarin said in comments accompanying the results.

"Vodafone Essar in India is delivering very strong growth and performing in line with our acquisition plan," he added.

India-born Sarin will leave the company at the end of July and hand over the reins to deputy chief executive Vittorio Colao.

Vodafone chairman John Bond said on Tuesday that Sarin had done a "tremendous" job during his time in charge.

However, Sarin has not had an easy ride at the telecommunications giant, as he endured a rocky patch in 2006 when nearly 10 percent of shareholders voted against his re-election.

Since then he has led Vodafone to strong revenue growth in fast-growing markets such as India and Turkey. In January, the firm revealed that most of its clients were now outside western Europe.

Sarin also helped steer the firm, which sponsors the England cricket team, through the wreckage of the dotcom crash in 2000 and has boosted its customer base from 120 million to 260 million globally.

"It has been a privilege to lead Vodafone for the last five years and to have been involved in the company for such a long time," he said in a statement released Tuesday.

"I feel that I have accomplished what I set out to achieve, particularly in developing and implementing a new strategy. I am very proud of what Vodafone and its 71,000 people have achieved and the good momentum we have in the marketplace.

"I know that the business is in capable hands with Vittorio Colao. Having worked with him for many years I know that he has the experience and vision to take Vodafone on to future success," Sarin added.

The 53-year-old joined Vodafone's board in 1999 and became chief executive in July 2003.

Sarin's leadership of Vodafone come under intense scrutiny in 2005/06, during which time a series of profit warnings and a perceived lack of strategic clarity sparked a 25-percent plunge in the group's share price and bitter recriminations at board level.

Vodafone said on Tuesday that adjusted operating profits rose by 5.7 percent to 10.1 billion pounds in 2007-08. Underlying pre-tax profits climbed 2.0 percent to 8.93 billion pounds.

In midday trade, Vodafone's share price was flat at 163.3 pence after earlier gains of about 2.0 percent. London's FTSE 100 leading shares index was down slightly.

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