Mobile phone giant Vodafone hailed an "important turning point" as it upped its full-year outlook after growing first half earnings and sales.
The group said it ramped up growth in organic service revenues - a closely-watched measure of sales - in the three months to the end of September, up by 1.2 per cent against a rise of 0.8 per cent in the first quarter.
It also returned to underlying earnings growth in the first half, up 1.9 per cent to £5.8 billion, and now expects a full-year haul of £11.7bn to £12bn, having previously guided at around £11.5bn.
Shares in the FTSE 100 listed firm lifted four per cent as the robust half-year results and profits upgrade came as a welcome dose of good news for investors after Vodafone recently dashed hopes of a £100bn mega-merger with cable firm Liberty Global.
The firm ended talks with Liberty in late September, having sparked speculation over a merger when it said in June it had entered discussions regarding ''a possible exchange of selected assets between the two companies''.
While Vodafone had always dismissed talk of a full-blown merger, the City was left disappointed that talks had come to nothing and shares slumped to their lowest level for nearly a year.
But in posting half-year results, the group cheered the success of its £19bn Project Spring investment plan, saying it was starting to pay off.
Group chief executive Vittorio Colao said: "We have reached an important turning point for the group."
He added: "Our customers are benefiting from the significant investments we are making in high speed mobile and fixed networks, as evidenced by the huge growth in demand for data and the increased loyalty to Vodafone services."
Its interim underlying earnings growth marked a sharp reversal of the 10 per cent drop seen a year earlier.
On a statutory basis, earnings were 1.7 per cent lower and pre-tax profits fell to £232m in the six months to the end of September, down from £406 million a year earlier.
Its return to sales growth comes despite ongoing tough conditions across Europe, where revenues fell one per cent, offset by a 6.7 per cent surge in Vodafone's fast growing Africa, Middle East and Asia-Pacific arm.
In the UK, Vodafone said it saw further growth in demand for 4G services, with another 1.3 million 4G customers signed up in the second quarter, bringing the total to 5.3 million at the end of September.
Mobile data almost doubled year-on-year as its customers took full advantage of 4G, with Vodafone's coverage now at 82 per cent of the UK population, up from around 50 per cent a year ago.
It also extended its consumer fixed broadband offer last month to nearly 22 million premises across the UK, and will launch TV services later in its financial year.
Newbury-based Vodafone has been pumping investment into its networks under Project Spring, which is resulting in wider 4G coverage in Europe and 3G coverage in emerging markets.
It said efforts have been bearing fruit, with more UK customers choosing to stay with the group as its churn fell by two percentage points in the half-year, while it also added 90,000 contract customers on a net basis in the second quarter.
Mobile service revenues in the UK edged 0.1 per cent higher in the first half despite a hit in the second quarter by regulatory changes meaning that all 0800 calls are now free from mobiles.
Overall, interim total service revenues fell 0.1 per cent.
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