CEO says Vodafone will not be slowed by macro woes

By Kate Holton

LONDON (Reuters) - Vodafone's new Chief Executive Vittorio Colao does not expect the mobile phone group's progress to be slowed by mounting economic challenges but it will have to adapt to consumers' changing demands, he said on Tuesday.

Speaking minutes after the company's annual general meeting when he took over from Arun Sarin, Italy's Colao told reporters that Vodafone (VOD.L) would have to offer customers different products to help them weather the worsening economic conditions.

Sarin, who had previously faced questions over some of his decisions, received loud and sustained applause from shareholders as he stepped down after five years.

"We are in a solid and resilient sector but clearly families will react differently in different parts of the world," Colao said. "You need to adjust to the times, but I don't think honestly that economic challenges will necessarily slow us down. They will push new needs. Times change and we will do things slightly differently.

"If families feel constrained we are going to give more SIM (only deals), lower prices, maybe less fancy handsets and maybe the handset renewal times will be pushed a little bit further."

Vodafone was hit last week by a 14 percent drop in its share price, which wiped nearly 11 billion pounds off its market value, after it said that full-year revenue would be at the bottom of a previously stated forecast.

Vodafone responded a day later by announcing a surprise 1 billion-pound share buy back programme, saying the new share price significantly undervalued the group. The buy back plan was approved by shareholders on Tuesday who voted before the AGM.

By Tuesday the shares were trading at 133 pence, some 2.8 percent higher than when the buy back was announced.