We are talking telephone numbers. This is the appropriate term for describing Vodafone's first-half figures today. Turnover in the same six-month period last year was £16,800,000,000, and this is expected to have risen significantly this year. This is a company which reported free cash flow of £7,800,000,000, at the full-year stage in March.

Vodafone is the world's largest mobile telephony group, flying the flag for Great Britain all over the world. So, if it is making so much money, why is it still recording a loss? The reason is the huge cost of acquiring 3G licences around the world. At the time, it was hard to see how the roll-out of 3G services could possibly cover those costs. Vodafone has confounded the doubters, as the latest handsets fly off the shelves on high-margin contract deals.

The number of major UK mobile operators is soon to diminish, with O2 about to be gobbled up by Spain's Telefonica at the end of the year. O2 started off as BT's mobile operation, trading as Cellnet, before being demerged as a stand-alone business called mmO2. Soon after, sensibly dropping the mm prefix left the company with its present name. O2 is widely held by many "tell Sid" investors, having held shares in what was called British Telecommunications Plc. The cash takeover windfall is expected to be paid in January next year.

Yesterday's interim figures from O2 were rather academic in view of this, but are useful for a direct comparison to rival Vodafone's numbers today.

Tomorrow sees Jamie Oliver's favourite store, Sainsbury's, announce its interim results for the half year. The "Make Sainsbury's Great Again" campaign seems to have worked. The supermarket recently revealed the strongest growth in underlying sales since 2001 for its second quarter. The confirmation of the figures should put more meat on the bone.

Just before Halloween, the thought of stocks and shares resembling shocks and scares was apparent, with the FTSE falling by 6.5 per cent in the space of three weeks. Failing to be spooked out, the market then rallied back by 6.2 per cent in the subsequent fortnight, providing a good return for those second-guessing the market and taking advantage of the dip by buying.

Company results continue to show growth prospects. Added to this is the very large number of takeovers we have witnessed this year. Clearly, bids for companies would not be made if the bidder did not believe that the target share price undervalued the future growth prospects.

The North-East has many plcs that operate in the area but, unfortunately, not many are headquartered in the area. One company that we do still have, just, is Northgate. The Darlington-based light commercial vehicle company was the subject of a £12-a-share offer from financier Guy Hands' Terrafirma Group. Shareholders viewed the offer as insufficient, and turned it down. The share price has since fallen back to values seen before the approach. Some may deduce from this that the valuation is clearly wrong.

In any kind of investment approach, the question of what represents good value is the fundamental starting point. Taking the example of Vodafone, the company is still loss-making, but how long will it be before bumper profits are dialled in?

For investment advice contact Anthony Platts on 01642 608855.

Published: 15/11/2005