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VODAFONE’S SARIN LEAVES AT THE TOP

TOUGH: Sarin has achieved his aims and will hand over to Colao

Wednesday May 28,2008

By Andrew Johnson

VODAFONE chief executive Arun Sarin stunned the City yesterday by announcing plans to quit as the company reported a strong rise in year-end revenues and pre-tax profits.

He will be replaced by deputy chief executive Vittorio Colao at the company’s annual meeting in July after a roller-coaster five years in charge.

Pre-tax losses of £2.4billion became profits of £9billion on revenues up 14 per cent to £35billion for the year to March.

The results were driven by booming growth in its emerging markets division, where profits and revenues rose by about 14 per cent.

European revenues fell 2 per cent and the company warned of challenging times ahead as pricing regulations and competition tightened.

Vodafone shares fell 2.75p to 160.5p.

Sarin, 53, said he had approached chairman Sir John Bond a few months ago to state his ambition to retire.

“When I came here five years ago, there were certain things I wanted to do, and I have done those things.”

Analysts said Sarin was ahead of rivals in leading a move into emerging markets, such as India and Africa, to offset slowing growth, stiffer competition and falling prices in Europe.

Sarin also highlighted the company’s moves into broadband, mobile internet and data services.

He said its course was now clear. “We will get the African stuff done, we will get the Asian stuff done, we will get the internet stuff done and we will get the cost-cutting done,” he said. “My leaving will not slow it down.”

Sarin, who joined when Vodafone’s shares were 119p, said the company had returned £34billion through dividends and cash returns, during his time in charge.

Sarin’s toughest moment came two years ago when 10 per cent of investors voted against his re-election to the board.

He had issued three profits warnings amid criticism the company had overspent billions on acquisitions.

Colao will have to deal with US arm Verizon, which has yet to pay a dividend despite investor demands.