Vodafone sees revenue drain in Spain

Vodafone has seen revenue from its core business grow 1.5% in the second quarter of 2011 although the firm is certainly struggling against some serious headwinds in some markets.Spain, its third largest European market (after Germany and Italy) saw revenue drop 9.9% as the company was forced to cut prices amid severe economic hardship.The other major factor facing them firm has been a crackdown on termination rates in its European markets. These are charges Vodafone can charge other companies to connect to its network. The effect of the reduction in termination rates pushed revenues down from what would have been a more impressive 3.9% growth.Nevertheless, the group still generated £10.858bn in the second quarter from mobile services. Other income pushed that total to £11.659bn.Vodafone also reports debt of £23.1bn and free cash of £1.3bn.Capital expenditure was up £0.2bn to £1.2bn.Vittorio Colao, Chief Executive, commented: "We have made a good start to the year, reporting robust results despite challenging macroeconomic conditions across southern European economies and the impact of cuts to mobile termination rates."BS