Vodafone boosted by Verizon

It was the strength of this final trend - Vodafone is exposed to the US through its 45 per cent stake in Verizon Wireless (VZW) - that single-handedly accounted for the UK group's bottom-line growth over the year to end-March. Its share of VZW's profits rose from £4.9bn to £6.4bn, overwhelming a 8.3 per cent decline in cash profits within the wholly-owned businesses. Overall, Vodafone's adjusted operating profit rose 3.7 per cent to just shy of £12bn. Strip out the impact of disposals and currency movements and the growth looks even better, at 9.3 per cent.

The irony is that Vodafone is not responsible for VZW, which is run by its majority owner, the New York-listed telecoms group, Verizon Communications. Verizon is rumoured to be mulling a bid for the minority stake - for reasons its financial results make obvious. The question is at what price Vodafone would be prepared to sell such a lucrative investment. There was no news on this sensitive subject in these results. Meanwhile, Verizon has promised Vodafone a £2.1bn dividend payment in June, on top of the £2.4bn in received in December.

Vodafone's UK business underperformed, reporting a 27 per cent slide in operating profits due to lower phone-call revenues and higher operating costs. The Mediterranean nations put in similarly dismal performances and management was forced to take an eye-watering £7.7bn impairment charge as it wrote-down cash flow assumptions in Italy and Spain.

Countries that performed slightly better included Germany (like-for-like revenues up 0.5 per cent) and Turkey (revenues up 17.3 per cent). India and the African business, Vodacom, also posted decent figures. Vodacom is particularly lucrative, generating operating profits of £1.2bn - a tenth of the group total.

Broker JP Morgan Cazenove expects current year adjusted pre-tax profits of £10.9bn and EPS of 16.5p (up from £10.5bn and 15.7p).