British cellular giant Vodafone surprised everyone as they announced an annual profit with a solid forecast for 2009. The company also announced the departure of its chief executive, Arun Sarin.
“Everything has been put in place for Vodafone: it has a strong reach and it is benefiting from strong emerging markets,” said Michael Kovacocy, an analyst with Daiwa Institute, referring to Sarin’s departure.
Vodafone said annual gross earnings rose 10.2%, to $26.1 billion, which was slightly higher than analysts’ expectations. Sales rose 14.1%, to $70.2 billion. Vodafone had posted a $43.3 billion loss for the year ending in March 2006.
The world’s second-largest wireless operator paid tribute to its departing chief executive: “Under his leadership Vodafone has developed and implemented a new strategy to become a total communications company, which is already delivering results.”
Arun Sarin has been the driver behind Vodafone’s strategy to carve off slow-moving operations in Europe, notably in Switzerland and Belgium and also Japan, whilst expanding in emerging markets by, for instance, buying Turkey’s Telsim in 2005 and India’s Hutchinson Essar in 2007.
The company’s 2007 results were boosted by sales in emerging markets like Eastern Europe, the Middle East and Asia, which saw a 14.5% rise in organic sales. The company’s European unit reported sales growth of 2.0%.
Deputy chief executive and head of the European business, Vittorio Colao, will replace Sarin when he officially steps down in July.