The company made £476.9m in the first half of the year, an increase of more than 50% on last year's figure of £297.5m.

The number of subscribers to its networks worldwide increased from 4.6m to 7.3m over the past year.

Market growing fast

The company says the mobile phone market is still growing strongly, and predicts that half the UK population will have a mobile phone by 2003.

The number of people who give up their mobile phones during the year - the so-called "churn rate" - also dropped from 29.9% to 26.2%.

But average revenue per user was down 8%, reflecting the tougher competition and lower price deals now available in the market.

Vodafone shares rose 16.5p to £8.68 on the news. Vodafone is now worth £26.5bn, the fifteenth biggest company in Britain.

Overseas investment

Vodafone has invested heavily in mobile phone operations overseas in recent years, and now has a substantial presence in key markets in Asia and Europe. After spending more than £2bn, it has 2.5m subscribers in France, 1m in Germany, and more than 600,000 in the Netherlands. It is also a major player in Australia and South Africa.

The company aims for half its profits to come from overseas within the next five years.

The mobile phone industry is one of the fastest growing sectors of the UK economy, with over ten million users, and it could double again in the next five years.

As the largest mobile phone operator, Vodafone has benefited from the increase - although it had to spend heavily to convert its network from analogue to digital, which gives a clearer signal.