LONDON’S BUSINESS NEWSPAPER
LET RIVALRIES RECOMMENCE ALL YOU NEED AHEAD OF THE SIX NATIONS IN OUR EIGHT PAGE TOURNAMENT PULLOUT P13-20 THURSDAY 2 FEBRUARY 2023
ISSUE 3,927
CITYAM.COM
STRUGGLING FOR SIGNAL VODAFONE INTERIM BOSS SAYS ‘WE CAN DO BETTER’
LOUIS GOSS AND CITY A.M. STAFF VODAFONE’s interim boss Margherita Della Valle was yesterday forced to tell markets the telecoms giant “can do better” after another disappointing set of results. Declines in revenue generation across Europe were expected but markets still reacted poorly, sending shares down again at the troubled telecoms giant. Della Valle stepped into the top job after
the short-notice departure of former boss Nick Read, who had come under pressure for overseeing a share price that has fallen some 58 per cent in the past five years. Underperformance in Germany was again a particular concern, where a combination of price hikes and new regulatory powers, which make it easier for customers to switch, have taken their toll. The country accounts for around 30 per cent of the firm’s overall revenues.
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Analysts were scathing yesterday, despite signs of good growth in the UK and guidance remaining in place, albeit already downgraded. AJ Bell’s Russ Mould described the firm as a “megacap plodder” and said recent disposals still leave the firm “open to accusations it looks like an investment trust of telecoms assets that is offering nothing much by way of sales, profit or dividend growth.” CMC Markets’ Michael Hewson said
there was “little sign that management have a plan that can stem recent declines”. Della Valle said the firm had introduced initiatives to generate half of a planned £800m cost-reduction package and had changed management structures. “There is more to do and our focus is to provide a better service to our customers, become a simpler business and deliver growth,” she said yesterday. A new CEO search remains ongoing.
FREE STARS AND HIKES
Stage set for Bank as Fed slows hikes JACK BARNETT THE US Federal Reserve has climbed down to the lowest interest rate hike in nearly a year in a sign the world’s most influential central bank is nearing the end of its aggressive campaign to tame a historic inflation surge. Fed chair Jerome Powell and the rest of the federal open market committee yesterday backed a 25 basis points increase, taking the global financial system’s anchor rate to a range of 4.5 per cent and 4.75 per cent. It is the weakest rise since the Fed’s first hike in this current tightening cycle back in March 2022 and is likely to reinforce expectations that the Fed is approaching the end of this current rate hike cycle. US inflation has been coming down since last summer after it peaked at just over nine per cent, driven lower by a combination of the Fed’s rate decisions and a reduction in petrol prices. The move sets the stage for the Bank of England and European Central Bank today, both of which are expected to go harder than the Fed and back 50 basis point increases. The Bank today is poised to repeat forecasts warning the country will tip into recession, albeit a much shallower and shorter one than forecast back in November.
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