Vodafone boss backs UK staying in EU

The boss of Vodafone has backed the UK remaining part of the European Union on the day the Prime Minister set out his four key demands to reform the EU.

The mobile phone giant's chief executive, Vittorio Colao, told the BBC it was "important" Britain remained part of the EU.

He also ignited a row with BT over broadband speeds, saying people outside the UK had much faster rates.

Separately, Vodafone shares closed up 3.9% after it reported higher revenues.

Underlying revenues rose 1.2% in the three months to the end of September, up from 0.8% in the previous quarter.

Speaking to the BBC, Mr Colao said: "Let me separate the political decision from the business situation.

"The political decision is clearly for the voters, it's clearly a British citizens' decision.

"For our business, if you think about it, we are a digital business. We have more than 50% of our revenues and profits in Europe. We want a single digital market, and we want to be part of that single digital market.

"So from our point of view for the business, it's important that Britain remains as part of the single European market because it's good for our customers, it's good for our shareholders, and it's good for the company itself, that can be more competitive and have lower costs. So, in that sense, yes, it is better if we remain in Europe."

Unveiling Vodafone's half-year results, Mr Colao said the company had reached an "important turning point" as organic service revenues - a closely-watched measure of sales - in the three months to the end of September rose 1.2% compared with a rise of 0.8% three months earlier.

The mobile phone operator reported, external a 1.9% rise in underlying earnings for the six months to the end of September to £5.8bn, although statutory pre-tax profits for the half-year fell to £232m from £406m a year earlier.

Vodafone also upgraded its full-year underlying profit outlook to between £11.7bn and £12bn compared with a previous forecast of around £11bn.

While the overall sales picture was an improved one, Vodafone once again saw declining revenue in Europe - its most developed market - where revenues fell 1%.

But its falling sales in Europe were offset by a 6.7% increase in its fast growing Africa, Middle East and Asia-Pacific division.

Shares ended the day 8.3p higher at 222.8p, valuing the company at almost £60bn.