Lower consumer spending forces firm to fix 2013 growth below previous target range of 1-4%
Vodafone lowered a medium-term target for revenue growth on Tuesday as consumers in southern Europe slashed spending and regulators upped the pressure on the world's largest mobile operator.
Vodafone posted full-year results in line with forecasts as strength in emerging markets and Germany and Turkey offset a slump in spending in Spain and Italy.
Group organic service revenue from the provision of ongoing services to customers was up 1.5% in the year, with Europe down 1.1% and Africa, West Asia and Asia Pacific up 8%.
But with trading in Italy and Spain showing few signs of improving and regulatory and foreign exchange pressures due to continue, Vodafone said it now expected organic service revenue growth in 2013 to be slightly below its previous medium term target range of 1-4%.
The British-based group is the latest in a long line of major companies to be hit by the austerity measures being imposed across Europe, where consumers facing tax rises, inflation and muted wage growth are under huge pressure to cut spending.
A reluctance to spend on discretionary goods, particularly in Italy, Spain and Greece, has hit Europe's biggest retailer Carrefour, drinks group Diageo and electricals retailer Kesa among others in recent weeks.
In the telecoms sector specifically, net profit at Spain's Telefonica halved in the first quarter due to torrid conditions in Italy and Spain.
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