Vodafone, the world's biggest telecoms operator by market value, today hinted at fresh job cuts after doubling its cost-cutting programme to £2 billion amid a sharp fall in revenues from its key UK market.

The mobile giant, which has already culled hundreds of jobs in the past year, said that it was looking to extend its ambitious £1 billion cost-cutting plan by a further £1 billion by 2012.

Vodafone said that the cost reductions would be predominantly targeted in areas such as technology and procurement as well as cutting back on network equipment. The programme, which had so far focused mainly on Europe, will now be extended to the rest of the company.

A spokesman for Vodafone said: "There will be some implications for jobs but that will not be the focus. The emphasis is around technology."

The extension of the cost-cutting programme was revealed as Vodafone released its figures for the six months to September 30, in line with expectations.

It also confirmed its guidance for the year of adjusted operating profit "in the range" of £11 billion to £11.8 billion with free cash flow "around the upper end" of the £6 billion to £6.5 billion range.

Interim pre-tax profits rose 3.6 per cent to £5.48 billion while revenues fell 3 per cent on a like-for-like basis to £21.8 billion.

Group earnings before interest, tax, depreciation and amortisation (Ebitda) fell 8 per cent on a like-for-like basis while in its key UK market revenues fell by 5.7 per cent. Shares in Vodafone led the FTSE 100 fallers this morning, losing 3p, or 2.17 per cent, to 134.95p.

Vodafone, which was once the top player in the UK, is set for a humiliating relegation to third place after the recently announced tie-up between rivals Orange, the French-owned group, and Deutsche Telekom.

It was knocked from its top spot several years ago by the BT spin-off, O2.

The mobile phone company first announced its plan for huge savings in November last year. It hit the £1 billion target a year early, at the end of this financial year — with savings drawn from areas including UK job cuts. It had said it hoped to hit that initial £1 billion by 2011.

The savings already accomplished are being used, the group said, to finance the roll-out of new services involving music, games and video.

Times Recommends

• Minister in talks with Saudis to protect creditors
• Premier Inn hits back in £29-a-room row
• Bankers hit back at 'populist' bonus supertax