Southern European woes hit Vodafone revenues Mobile phone giant Vodafone has suffered a drop in first-quarter revenues, blaming tough competition in the UK and "difficult" conditions in Italy and Spain. In Germany, the group's biggest market, revenues were down 5.1 per cent in the three months to 30 June, but chief executive Vittorio Colao said a deal to buy Kabel Deutschland, the country's largest cable operator, would give it an "excellent platform" to grow its range of services. The £6.6 billion acquisition of Kabel Deutschland is expected to be completed before the end of this year. Vodafone said first-quarter revenues in the UK 4.5 per cent lower than a year ago, but its businesses in Italy and Spain suffered even steeper declines of 17.6 per cent and 10.6 per cent respectively. Colao said: "Although regulation, competitive pressures and weak economies, particularly in southern Europe, continue to restrict revenue growth, we continue to lay strong foundations for the longer term." Richard Hunter, head of equities at Hargreaves Lansdown, said Vodafone's emerging markets provided a "bright spot," with strong revenue growth in India and Turkey. He added: "The company's strategy and prospects are complex and certainly not guaranteed. Even so, analysts are comfortable that Vodafone will come through and the general market view is that the shares are still a buy. Overall service revenues across the group, including joint ventures, dipped to £10.2bn in the first quarter, 3.5 per cent lower than a year ago, although Vodafone said this was in line with management expectations.