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Mobile phone giant Vodafone has suffered a £492 million half-year loss after being hit with a multi-billion write down in the value of its business in crisis-hit southern Europe.
The telecoms giant announced a £5.9 billion write down in Spain and Italy after the company recorded a pre-tax loss for the six months ending September 30 compared to a profit of £8 billion in the same period last year.
The predominant reasons behind Vodafone's failure over the past few months are it being hit by customers making fewer calls in the economically depressed southern region, along with the weakening of currencies in its major markets.
On announcing the latest financial results, Vodafone chief executive Vittorio Colao said: "Our results reflect tougher market conditions, mainly in southern Europe."
But Colao also added that he was feeling more positive regarding future opportunities, partly as a result of the group's "attractive and growing exposure to emerging markets", such as India and Turkey.
Vodafone was hit by the drop of 11.3% in southern Europe business while the downturn in northern Europe was 0.7%. The negative result was buoyed slightly by growth sustainment of 4.1% in its emerging markets.
However, there has been some good news for Vodafone, with the Berkshire-based firm being helped by the strong performance of its joint venture Verizon Wireless in the United States.
It said it expected to get a £2.4 billion dividend from Verizon Wireless by the end of the year and said it would start a £1.5 billion share buyback programme. Vodafone owns 45% of Verizon Wireless while Verizon Communications owns the other 55% in the joint venture.
For more information on the mobile phone market, see the latest research: Mobile Phone Reports
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