Vodafone manages to stop the bleeding of sales in the Spanish market and does so on the verge of the British fund Zegona taking control of the company, in an operation of 5,000 million that will be closed in the coming months pending the approval of the Spanish Government after receiving the ‘ok’ from the European Commission and the National Markets and Competition Commission (CNMC).
The teleco, which accumulated two years of constant business declines, managed to contain the declines and raised its total income by 0.2% in the third quarter of its fiscal year (between October and December), to 974 million euros. A slight increase thanks to the rise in sales of devices and terminals, up to 126 million, 11.5%, and despite the fall in service income (those directly related to telecommunications services and which better measure the evolution of the business) to 858 million, 1.16% less.
Vodafone continues to suffer the impact of very tough competition that the telecom sector in Spain has embarked on. The strength of the low-cost operators, which account for 60% of all company changes in the Spanish market, and the persistent trade war represent a burden for the Spanish subsidiary of the British group and punish its income, but throughout the year last year it has managed to reduce the magnitude of the falls quarter after quarter.
“In Spain, service revenues decreased due to continued price competition in the value customer segment, a smaller customer base and a reduction in mobile rates. This was partially offset by the positive contribution of linked price increases to inflation implemented in January 2023 and higher commercial income during the quarter,” notes the Vodafone Groupwhich will no longer consolidate the business of its Spanish subsidiary in its accounts with the sale to Zegona.
Vodafone Spain increased its customer base in the mobile sector by 29,000 lines between October and December, up to around 14 million users, mainly due to commercial acquisition actions focused on terminals (‘Black Friday’ and ‘Christmas’) and the offer of rates convergent with television. However, Vodafone lost 24,000 fixed broadband customers in its third fiscal quarter, down to 2.8 million users, while the TV customer base fell by 18,000, to 1.4 million. The base of active ‘internet of things’ (IoT) lines increased by 429,181, to 6.57 million.
Vodafone Spain concentrated 8.5% of the total turnover of the parent group in the third quarter of its fiscal year. The Vodafone Group’s turnover stood at 11,372 million euros between October and December, 2.28% less. However, in comparable organic terms (not accounting for the impact of exchange rates and hyperinflation in Turkey and some corporate operations) the company’s turnover grew by 4.2%.
