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(Sharecast News) - Telecoms operator Vodafone said it expected full-year earnings to be at the upper end of guidance after a strong first quarter performance including a contribution from Safaricom.
Adjusted earnings before interest, taxes, depreciation, amortisation and leases rose 6.7% to 2.9bn. The company on Monday said it expected the annual figure to be at the top end of the 13bn - 13.3bn revised guidance provided in May.
The group said the consolidation of Safaricom and early integration benefits from VodafoneThree would support stronger operating leverage through the rest of the year.
First quarter organic service revenue rose 5.2%. Vodafone said the performance provided a solid base for the year, with improving trends in Germany and a return to growth in the UK helping underpin its outlook.
Germany delivered 1.2% organic service revenue growth, driven by wholesale and fixedline gains, while the UK posted 0.6% growth, supported by broadband and business fixed lines. Other Europe grew 1%, with Ireland, Greece and the Czech Republic offsetting competitive pressure in Portugal and Romania.
Africa remained the strongest contributor, with 12.6% organic service revenue growth on continued demand for data and financial services. Vodafone Business grew 5% organically, helped by doubledigit expansion in digital services including IoT, cloud security and SaaS products.
Vodacom's acquisition of an additional 20% stake in Safaricom lifted Vodafone's effective holding to 55%, with full consolidation from 1 July expected to add 1.1bn of EBITDAaL this year.
Reporting by Frank Prenesti for Sharecast.com
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