UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULES 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
Dated
May 14, 2024
Commission
File Number: 001-10086
VODAFONE GROUP
PUBLIC LIMITED COMPANY
(Translation
of registrant’s name into English)
VODAFONE
HOUSE, THE CONNECTION, NEWBURY, BERKSHIRE, RG14 2FN,
ENGLAND
(Address
of principal executive offices)
Indicate
by check mark whether the registrant files or will file annual
reports under cover Form 20-F or Form 40-F.
Form
20-F ✓
Form 40-F _
This
Report on Form 6-K contains a Stock Exchange Announcement dated 14
May 2024 entitled ‘FY24 Preliminary Results.
Vodafone Group Plc
FY24 Preliminary Results
14 May 2024
Improving financial performance & transformation gaining
momentum
"A year ago, I set out my plans to transform Vodafone, including
the need to right-size Europe for growth. Since then, we have
announced a series of transactions and we are now delivering growth
in all of our markets across Europe and Africa.
We performed slightly ahead of expectations in the financial year,
with good organic service revenue growth of 6.3% and organic
EBITDAaL growth of 2.2%. Our Business division - a key growth
driver - achieved 5.4% revenue growth in the fourth
quarter.
Much more still needs to be done in the year ahead. We will step-up
investment in our customer experience, improve our underlying
performance in Germany and accelerate our momentum in Business,
whilst also continuing to simplify our operations throughout the
group. We are fundamentally transforming Vodafone for
growth."
Margherita
Della Valle Group Chief
Executive
|
Financial summary
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
Page
|
€m
|
€m
|
change %
|
change %1
|
|
Group revenue
|
3
|
36,717
|
37,672
|
(2.5)
|
|
|
Group service revenue
|
3
|
29,912
|
30,318
|
(1.3)
|
6.3
|
|
Operating profit
|
3
|
3,665
|
14,451
|
(74.6)
|
|
|
Adjusted EBITDAaL1
|
3
|
11,019
|
12,424
|
(11.3)
|
2.2
|
|
Profit for the financial year (continuing operations)
|
3
|
1,570
|
12,582
|
|
|
|
Basic earnings per share (continuing operations)
|
15
|
4.45c
|
43.66c
|
|
|
|
Adjusted basic earnings per share1
|
15
|
7.47c
|
11.28c
|
|
|
|
Cash inflow from operating activities
|
15
|
16,557
|
18,054
|
(8.3)
|
|
|
Adjusted free cash flow1
|
16
|
2,600
|
4,139
|
|
|
|
Net debt (excl. Spain and Italy)1
|
17
|
(33,242)
|
(33,250)
|
-
|
|
|
Total dividends per share
|
18
|
9.00c
|
9.00c
|
|
|
|
|
|
|
|
|
|
|
|
1. Non-GAAP measure. See page 36.
|
|
|
|
|
|
|
|
|
|
|
− Following the announcements of the sale of
Vodafone Spain and Vodafone Italy, both are now treated as
discontinued operations and FY23 is re-presented accordingly. See
page 27
−
Group revenue
decreased by 2.5% to €36.7 billion due to the disposals of
Vantage Towers, Vodafone Hungary and Vodafone Ghana in the prior
financial year and adverse exchange rate
movements
−
Operating
profit decrease
of 74.6% to €3.7 billion primarily reflects business
disposals in the prior financial year, in particular the €8.6
billion gain on disposal of Vantage Towers
Organic & Adjusted measures
−
Group service revenue
increased by 6.3%, with Europe, Africa and Business all
growing
−
Germany returned to
growth with service revenue increasing by 0.2% for the full year
and 0.6% for Q4, however adjusted EBITDAaL remained under pressure,
declining by 5.8% due to higher energy and other inflationary
costs
−
Continued
acceleration in B2B revenue throughout the year
(FY24: 5.0%
growth), supported by strong demand for digital
services
−
Adjusted EBITDAaL
increased by 2.2% as good service revenue progress was partially
offset by higher energy costs and other inflationary
impacts
−
Achieved FY24
guidance for adjusted EBITDAaL and adjusted free cash
flow
−
In FY25, we expect
adjusted EBITDAaL to be c.€11 billion and adjusted free cash
flow to be at least €2.4 billion
For more information, please
contact:
Investor
Relations:
Investors.vodafone.com
ir@vodafone.co.uk
Media Relations: Vodafone.com/media/contact
GroupMedia@vodafone.com
Registered Office: Vodafone House, The Connection, Newbury,
Berkshire RG14 2FN, England. Registered in England No.
1833679
A webcast Q&A session will be
held at 10:00 GMT on 14 May 2024.The webcast and supporting
information can be accessed at Investors.vodafone.com
|
Strategic Review ⫶Transformation
gaining momentum
|
|
In May 2023, we set out a new roadmap to transform Vodafone along
three strategic priorities: Customers; Simplicity; and Growth.
We measure our operational progress
in these areas through a consistent scorecard summarised below.
During FY24, we have reshaped our European footprint to focus on
growing markets, with strong positions and good local scale.
Alongside the progress to right-size our portfolio for growth, we
have made good early progress with our operational transformation,
which aims to improve the experience provided to our customers,
remove complexity from our operations and accelerate growth in
revenue, profit, cash flow and return on
capital.
Customers
− Wide-reaching customer experience
transformation underway, supported by reallocated investment of
€140 million in FY24, as well as new incentives and talent
development plans
− Customer insights processed
through real-time AI models, feeding into detailed action plans on
a weekly basis in all markets
− Frontline tools and processes
enhancements benefitting 70,000 team members
− Significant improvement in
Germany fixed network reliability, recognised in four independent
network quality tests
− Despite material price inflation,
customer detractors have reduced across all segments, and we now
have leading or co-leading net promotor scores
in 5
out of 9 European
markets
Simplicity
− New organisational structure and
executive management team in place
− Completed first phase of
commercialising shared operations, enabling greater transparency,
productivity and flexibility
− Actioned c.5,000 role reductions
and announced a further 2,000 in first year of 3-year 11,000 plan
and continued to deliver opex efficiencies
Growth
− Reshaped European footprint
focused on growing telco markets, with strong positions and good
local scale
− Vodafone now growing in all
segments and accelerating throughout the year
−
Accelerated organic service revenue
growth of Vodafone Business to 5.4% in Q4; B2B focus step-up with
new organisation, sales transformation plan, investment in products
and capabilities and strategic partnership with
Microsoft
|
Customers
|
|
|
|
Simplicity
|
|
|
|
|
FY24
|
|
|
FY24
|
|
Consumer NPS
|
|
|
|
|
|
|
|
Germany
|
YoY
|
Stable
|
|
Europe
opex savings (FY23-FY24)
|
€ billion
|
0.4
|
|
UK
|
YoY
|
Increased
|
|
Productivity
(role reductions)
|
'000
|
c.5
|
|
Other
Europe
|
YoY
|
Stable
|
|
Shared
operations NPS (May'24)
|
%
|
85
|
|
South
Africa
|
YoY
|
Stable
|
|
Employee
engagement index (Oct'23)
|
%
|
77
|
|
Detractors
|
|
|
|
|
|
|
|
Germany
|
YoY
|
Improved
|
|
|
|
|
|
UK
|
YoY
|
Improved
|
|
|
|
|
Other
Europe
|
YoY
|
Improved
|
|
|
|
|
|
South
Africa
|
YoY
|
Improved
|
|
Growth1
|
|
|
|
Revenue market share
|
|
|
|
|
FY24
|
|
Germany
|
YoY
|
Stable
|
|
Organic
Service revenue growth
|
%
|
6.3
|
|
UK
|
YoY
|
Increased
|
|
B2B
organic service revenue growth
|
%
|
5.0
|
|
Other
Europe
|
YoY
|
Increased
|
|
Organic
Adjusted EBITDAaL growth
|
%
|
2.2
|
|
South
Africa
|
YoY
|
Stable
|
|
Adjusted
free cash flow
|
€ billion
|
2.6
|
|
Network quality
|
Very good reliability in all European markets
|
|
Pre-tax
return on capital employed
|
%
|
7.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1. Non-GAAP measure. See page 36.
More remains to be done across all these areas in FY25. Our
priorities for the year ahead include: stepping-up our operational
performance in Germany; further strengthening our capabilities in
Vodafone Business; completing the commercialisation of our shared
operations; and completing our in-flight portfolio transformation.
A more detailed summary of our transformation progress and focus
areas for FY25 is contained within an accompanying presentation and
video Q&A available here: investors.vodafone.com/results.
Financial Review ⫶Improved
service revenue trends
|
|
|
Financial results
−
Total
revenue: Declined
by 2.5% to €36.7 billion due to the disposals of Vantage
Towers, Vodafone Hungary and Vodafone Ghana in the prior financial
year and adverse exchange rate movements.
−
Service
revenue: Decreased
by 1.3%, however on an organic basis, increased by 6.3%, with
Europe, Africa and Business all growing. Excluding Turkey, the
Group had good service revenue growth of +3.7% on an organic
basis.
−
Operating
profit: Decreased
by 74.6% to €3.7 billion primarily reflects business
disposals in the prior financial year, in particular the €8.6
billion gain on disposal of Vantage Towers.
−
Adjusted
EBITDAaL: Increased
by 2.2% on an organic basis as good service revenue progress was
partially offset by higher energy costs and other inflationary
impacts. Excluding
Turkey, adjusted EBITDAaL declined
by 0.6% on
an organic basis.
−
Earnings per
share: Basic
earnings per share from continuing operations was 4.45 eurocents,
compared to basic earnings per share of 43.66 eurocents in the
prior year, primarily due to lower operating profit. Adjusted basic
earnings per share was 7.47 eurocents, compared to 11.28 eurocents
in the prior year, primarily due to lower adjusted
EBITDAaL.
−
Discontinued
operations: Following
the announcement that we entered into binding sale agreements with
respect to the sales of Vodafone Spain and Vodafone Italy, both
businesses are now reported separately as discontinued operations
in the consolidated financial statements. See Note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
|
|
|
Re-presented2
|
|
|
|
FY241
|
FY23
|
Reported
|
|
€m
|
€m
|
change %
|
Revenue
|
36,717
|
37,672
|
(2.5)
|
- Service revenue
|
29,912
|
30,318
|
(1.3)
|
- Other revenue
|
6,805
|
7,354
|
|
Adjusted EBITDAaL3,4
|
11,019
|
12,424
|
(11.3)
|
Restructuring costs
|
(703)
|
(538)
|
|
Interest on lease liabilities5
|
440
|
355
|
|
Loss on disposal of property, plant and equipment and intangible
assets
|
(34)
|
(41)
|
|
Depreciation and amortisation of owned assets
|
(7,397)
|
(7,520)
|
|
Share of results of equity accounted associates and joint
ventures
|
(96)
|
433
|
|
Impairment reversal/(loss)
|
64
|
(64)
|
|
Other income
|
372
|
9,402
|
|
Operating profit
|
3,665
|
14,451
|
(74.6)
|
Investment income
|
581
|
232
|
|
Financing costs
|
(2,626)
|
(1,609)
|
|
Profit before taxation
|
1,620
|
13,074
|
|
Income tax expense
|
(50)
|
(492)
|
|
Profit for the financial year - Continuing operations
|
1,570
|
12,582
|
|
Loss for the financial year - Discontinued operations
|
(65)
|
(247)
|
|
Profit for the financial year
|
1,505
|
12,335
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
- Owners of the parent
|
1,140
|
11,838
|
|
- Non-controlling interests
|
365
|
497
|
|
Profit for the financial year
|
1,505
|
12,335
|
|
|
|
|
|
|
Basic earnings per share - Continuing operations
|
4.45c
|
43.66c
|
|
Basic earnings per share - Total Group
|
4.21c
|
42.77c
|
|
Adjusted basic earnings per share3
|
7.47c
|
11.28c
|
|
Further information is available in a spreadsheet
at investors.vodafone.com/results
Notes:
1.
The FY24 results reflect average foreign exchange rates of
€1:£0.86, €1:INR 89.80, €1:ZAR 20.31,
€1:TRY 29.08 and €1:EGP 34.83.
2.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' in the condensed
consolidated financial statements for more
information.
3.
Adjusted EBITDAaL and Adjusted basic earnings per share are
non-GAAP measures. See page 36 for more
information.
4.
Includes depreciation on leased assets of €3,003 million
(FY23: €2,682 million).
5.
Reversal of interest on lease liabilities included within Adjusted
EBITDAaL under the Group's definition of that metric, for
re-presentation in financing costs.
Cash flow, funding & capital allocation
−
Cash from
operating activities: Decreased
8.3% to €16.6 billion (FY23: €18.1 billion) reflecting
lower operating profit, excluding a lower share of results in
equity accounted associates and joint ventures and a net gain in
the prior year resulting from the sale of Vantage Towers, Vodafone
Ghana and Vodafone Hungary, and adverse working capital movements,
which offset lower taxation payments.
−
Adjusted free
cash flow: Decreased
by 37.2% to €2.6 billion (FY23: inflow of €4.1
billion), reflecting lower adjusted EBITDAaL. Adjusted free cash
flow from Spain and Italy was €0.7
billion.
−
Net
debt: Remained
stable at €33.2 billion, with free cash inflow of €1.8
billion and other movements of €1.1 billion, offset by
acquisition and disposals of €0.3 billion and equity
dividends of €2.4 billion.
−
Current
liquidity: Cash
and cash equivalents and short-term investments totalled €9.4
billion (€16.0 billion as at 31 March 2023). This includes
€1.9 billion of net collateral which has been posted to
Vodafone from counterparties as a result of positive mark-to-market
movements on derivative instruments (€4.6 billion as at 31
March 2023).
−
Shareholder
returns: Total
dividends per share are 9.0 eurocents (FY23: 9.0 eurocents)
including a final dividend per share of 4.5 cents. The ex-dividend
date for the final dividend is 6 June 2024 for ordinary
shareholders and 7 June 2024 for ADR holders, the record date is 7
June 2024 and the dividend is payable on 2 August
2024.
|
|
FY24
|
FY23
|
Reported
|
Cash flow and funding
|
€m
|
€m
|
change %
|
Inflow from operating activities
|
16,557
|
18,054
|
(8.3)
|
Outflow from investing activities
|
(6,122)
|
(379)
|
(1,515.3)
|
Outflow from financing activities
|
(15,855)
|
(13,430)
|
(18.1)
|
Net cash (outflow)/inflow
|
(5,420)
|
4,245
|
(227.7)
|
Cash and cash equivalents at the beginning of the financial
year
|
11,628
|
7,371
|
|
Exchange (loss)/gain on cash and cash equivalents
|
(94)
|
12
|
|
Cash and cash equivalents at the end of the financial
year
|
6,114
|
11,628
|
|
|
|
|
|
|
Closing borrowings less cash and cash equivalents (excl. Spain and
Italy)
|
(50,804)
|
(51,165)
|
0.7
|
Closing borrowings less cash and cash equivalents (incl. Spain and
Italy)
|
(54,168)
|
(54,685)
|
0.9
|
|
|
|
|
|
|
|
Re-presented1
|
|
|
|
FY24
|
FY23
|
Reported
|
|
|
€m
|
€m
|
change %
|
Adjusted free cash
flow2,3
|
2,600
|
4,139
|
(37.2)
|
Licences and spectrum
|
(454)
|
(773)
|
|
Restructuring costs including working capital
movements
|
(254)
|
(249)
|
|
Integration capital additions
|
(81)
|
(200)
|
|
Vantage Towers growth capital expenditure
|
-
|
(497)
|
|
Other adjustments
|
(28)
|
163
|
|
Free cash flow2
|
1,783
|
2,583
|
(31.0)
|
|
|
|
|
|
Closing net debt (excl. Spain and
Italy)2
|
(33,242)
|
(33,250)
|
-
|
Closing net debt (incl. Spain and
Italy)2
|
(33,349)
|
(33,375)
|
0.1
|
Notes:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' in the condensed
consolidated financial statements for more
information.
2.
Adjusted free cash flow, Free cash flow and Net debt are non-GAAP
measures. See page 36 for more information.
3.
Discontinued operations generated €722 million in adjusted
free cash flow for the year ended 31 March 2024 (FY23: €703
million), in addition to the reported total from continuing
operations.
Outlook & capital allocation ⫶A
year of transition
|
|
Performance against FY24 guidance and FY25
guidance
In May 2023, we set out guidance for FY24 for Group adjusted
EBITDAaL and adjusted free cash flow. For FY24, we reported
adjusted EBITDAaL and adjusted free cash flow of €11.0
billion and €2.6 billion, excluding the financial results
from Vodafone Spain and Vodafone Italy. The FY24 outcome, as
reported, reflects adverse foreign exchange rate movements versus
those used for the basis of guidance, discontinued operations, and
other items, which in aggregate, impacted adjusted EBITDAaL by
€2.4 billion and adjusted free cash flow by €0.9
billion. The table below compares the guidance given and our actual
performance.
As Vodafone Italy and Vodafone Spain are now recognised as
discontinued operations, any financial contribution in FY25 has
been excluded from our FY25 guidance. However, for FY25 we expect a
net cash inflow from discontinued operations of c.€0.4
billion, which is excluded from FY25 guidance. For
further information please refer to appendix VII in the
accompanying presentation available
here: investors.vodafone.com/results.
€bn
|
|
Adjusted
EBITDAaL1
|
Adjusted
FCF1,2
|
FY24
guidance
|
|
c.13.3
|
c.3.3
|
FY24 outcome - guidance basis3,4
|
|
13.4
|
3.5
|
Impact
of exchange rates
|
|
(0.3)
|
(0.2)
|
FY24 actual - constant portfolio
|
|
13.1
|
3.3
|
Impact
of discontinued operations
|
|
(2.1)
|
(0.8)
|
Impact
of exchange rates
|
|
(0.3)
|
(0.1)
|
FY24 re-based4,5,6
|
|
10.7
|
2.4
|
FY25 guidance4,5,7
|
|
c.11.0
|
at
least 2.4
|
Notes:
1.
Adjusted EBITDAaL and Adjusted free cash flow are non-GAAP
measures. See page 36 for more information.
2.
Adjusted free cash flow is Free cash flow before licences and
spectrum, restructuring costs arising from discrete restructuring
plans, integration capital additions and working capital related
items, and M&A.
3. The
FY24 outcome on guidance basis is derived by applying FY24 guidance
foreign exchange rates and includes Vodafone Spain and Vodafone
Italy. The FY24 guidance foreign exchange rates were €1: GBP
0.88; €1: ZAR 19.30; €1: TRY 21.10; €1: EGP
33.38.
4.
Excluding the impact of hyperinflationary accounting in
Turkey.
5.
Following the announcement that Vodafone has entered into binding
sale agreements with respect to the sale of Vodafone Spain and
Vodafone Italy, both businesses have been reported as discontinued
operations in accordance with IFRS. The financial results of
Vodafone Spain and Vodafone Italy continue to be reflected in
Vodafone Group's consolidated financial statements, however the
financial results from discontinued operations are reported
separately from our continuing operations, and therefore, they are
excluded from the FY24 re-based outcome and FY25
guidance.
6. The
FY24 re-based outcome is derived by applying FY25 guidance foreign
exchange rates.
7.
The FY25 guidance reflect the following foreign exchange rates:
€1: GBP 0.86; €1: ZAR 20.58; €1: TRY 34.98;
€1: EGP 51.75. The guidance assumes no material change to the
structure of the Group.
Capital allocation
In March 2024, we conducted a broad capital allocation review,
considering the Group's strategy within its reshaped footprint.
Following an extensive review of our capital investment
requirements, the current capital intensity will be broadly
maintained by market, which we believe allows for appropriate
investment in networks and growth opportunities. A new leverage
policy of 2.25x - 2.75x Net Debt to Adjusted EBITDAaL will be
adopted and we will target to operate within the bottom half of
this range. The new leverage policy supports a solid investment
grade credit rating and positions Vodafone to continue to invest
for growth over the long-term.
Following the right-sizing of the portfolio as a result of the sale
of Vodafone Spain and Vodafone Italy, the Board has determined to
adopt a new rebased dividend from FY25 onwards. The Board is
targeting a dividend of 4.5c per share for FY25, with an ambition
to grow it over time. The new dividend has been set at a
sustainable level, which ensures appropriate cash flow cover and
sufficient flexibility to invest in the business for growth. The
Board has also approved a capital return through share buybacks of
up to €2.0 billion of proceeds from the sale of Vodafone
Spain. The Board anticipates the opportunity for further share
buybacks of up to €2.0 billion following the completion of
the sale of Vodafone Italy, which is expected in the first half of
2025.
Segment performance ⫶Growth
across all segments
|
|
Following
the announcements that we have entered into binding agreements in
relation to the sale of Vodafone Spain and Vodafone Italy, we have
updated our financial reporting to recognise that Vodafone Spain
and Vodafone Italy are now discontinued operations, in accordance
with International Financial Reporting Standards ('IFRS').
Accordingly, Vodafone Spain and Vodafone Italy are excluded from
the results of continuing operations and are instead presented as a
single amount as a loss after tax from discontinued operations in
the Group's consolidated income statement. Discontinued operations
are also excluded from the Group's segment reporting. The FY23
comparatives in the tables below have been re-presented to reflect
that Vodafone Spain and Vodafone Italy are discontinued operations
and should be used as the basis of comparison to our FY24
results.
|
Geographic performance summary
Segment results
|
Total revenue
|
Service revenue
|
Adjusted EBITDAaL1
|
Adjusted EBITDAaL
margin1
|
Capital additions
|
|
|
FY24
|
FY23
|
FY24
|
FY23
|
FY24
|
FY23
|
FY24
|
FY23
|
FY24
|
FY23
|
|
€m
|
€m
|
€m
|
€m
|
€m
|
€m
|
%
|
%
|
€m
|
€m
|
|
Germany
|
12,957
|
13,113
|
11,453
|
11,433
|
5,017
|
5,323
|
38.7
|
40.6
|
2,515
|
2,558
|
|
UK
|
6,837
|
6,824
|
5,631
|
5,358
|
1,408
|
1,350
|
20.6
|
19.8
|
866
|
882
|
|
Other Europe
|
5,504
|
5,744
|
4,722
|
5,005
|
1,516
|
1,632
|
27.5
|
28.4
|
845
|
880
|
|
Turkey2,3
|
2,362
|
2,072
|
1,746
|
1,593
|
510
|
424
|
21.6
|
20.5
|
319
|
234
|
|
Africa3
|
7,420
|
8,076
|
5,951
|
6,556
|
2,539
|
2,880
|
34.2
|
35.7
|
1,005
|
1,123
|
|
Vantage Towers
|
-
|
1,338
|
-
|
-
|
-
|
795
|
|
|
-
|
551
|
|
Common Functions
|
1,864
|
1,750
|
559
|
530
|
29
|
20
|
|
|
781
|
839
|
|
Eliminations
|
(227)
|
(1,245)
|
(150)
|
(157)
|
-
|
-
|
|
|
-
|
-
|
|
Group4
|
36,717
|
37,672
|
29,912
|
30,318
|
11,019
|
12,424
|
30.0
|
33.0
|
6,331
|
7,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Downloadable performance information is available
at: investors.vodafone.com/results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment service revenue growth
|
FY23
|
FY24
|
|
Q4
|
H2
|
Total
|
Q1
|
Q2
|
H1
|
Q3
|
Q4
|
H2
|
Total
|
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
|
Germany
|
(2.8)
|
(2.3)
|
(1.6)
|
(1.3)
|
1.0
|
(0.1)
|
0.3
|
0.6
|
0.5
|
0.2
|
|
UK
|
(1.6)
|
0.5
|
4.0
|
3.0
|
5.1
|
4.1
|
5.5
|
6.8
|
6.2
|
5.1
|
|
Other Europe
|
(5.2)
|
(1.8)
|
0.1
|
(7.4)
|
(7.2)
|
(7.3)
|
(7.8)
|
0.3
|
(4.0)
|
(5.7)
|
|
Turkey2,3
|
32.4
|
9.3
|
(4.6)
|
(8.5)
|
21.6
|
7.4
|
6.8
|
15.6
|
11.7
|
9.6
|
|
Africa3
|
(11.2)
|
(4.5)
|
2.7
|
(14.3)
|
(14.8)
|
(14.6)
|
(7.5)
|
1.2
|
(3.4)
|
(9.2)
|
|
Group4
|
(3.2)
|
(1.6)
|
0.4
|
(4.7)
|
(1.9)
|
(3.3)
|
(1.5)
|
2.9
|
0.7
|
(1.3)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment organic service revenue growth1
|
FY23
|
FY24
|
|
Q4
|
H2
|
Total
|
Q1
|
Q2
|
H1
|
Q3
|
Q4
|
H2
|
Total
|
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
%
|
|
Germany
|
(2.8)
|
(2.3)
|
(1.6)
|
(1.3)
|
1.1
|
(0.1)
|
0.3
|
0.6
|
0.5
|
0.2
|
|
UK
|
3.8
|
4.6
|
5.6
|
5.7
|
5.5
|
5.6
|
5.2
|
3.6
|
4.4
|
5.0
|
|
Other Europe
|
3.6
|
2.8
|
2.8
|
4.1
|
3.8
|
3.9
|
3.6
|
5.5
|
4.6
|
4.2
|
|
Turkey2,3
|
54.9
|
51.7
|
43.5
|
74.1
|
85.0
|
79.3
|
90.4
|
105.6
|
97.8
|
88.5
|
|
Africa3
|
7.0
|
7.5
|
7.5
|
9.0
|
9.0
|
9.0
|
8.8
|
10.0
|
9.4
|
9.2
|
|
Group4
|
3.4
|
3.6
|
3.9
|
5.4
|
6.6
|
6.0
|
6.3
|
7.1
|
6.7
|
6.3
|
|
Notes:
1.
Organic service revenue growth, Group Adjusted EBITDAaL and Group
Adjusted EBITDAaL margin are non-GAAP measures. See page 36 for
more information.
2.
Comprises only Vodafone Turkey in FY24. The comparative period
includes the results of Vodafone Ghana which, as previously
reported, was sold in February 2023.
3.
Service revenue growth and Organic service revenue growth metrics
for FY23 have been re-presented to reflect the move of Vodafone
Egypt to Vodacom from 1 April 2023 and the segment has been
re-named Africa.
4.
Prior year Group metrics for Total revenue, Service revenue,
Service revenue growth, Organic Service revenue growth, Adjusted
EBITDAaL, Adjusted EBITDAaL margin and Capital additions have been
re-presented to reflect that Vodafone Spain and Vodafone Italy are
now reported as discontinued operations and are therefore excluded
from these Group metrics.
Germany ⫶ Underlying
improvement offset by first MDU impact
|
|
|
|
|
|
|
38%
|
|
€13.0bn
|
|
0.2%
|
|
of Group service revenue
|
Total revenue
|
Organic service revenue growth
|
|
|
|
|
|
|
46%
|
|
€5.0bn
|
|
(5.8%)
|
|
of Group Adjusted EBITDAaL
|
Adjusted EBITDAaL
|
Organic Adjusted EBITDAaL growth
|
|
|
|
|
|
|
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %1
|
Total revenue
|
12,957
|
13,113
|
(1.2)
|
|
- Service revenue
|
11,453
|
11,433
|
0.2
|
0.2
|
- Other revenue
|
1,504
|
1,680
|
|
|
Adjusted EBITDAaL
|
5,017
|
5,323
|
(5.8)
|
(5.8)
|
Adjusted EBITDAaL margin
|
38.7%
|
40.6%
|
|
|
Note:
1. Organic
growth is a non-GAAP measure. See page 36 for more information.
Growth
Total revenue decreased by 1.2% to €13.0 billion, driven by
lower equipment revenue. Service revenue grew by 0.2% (Q3: 0.3%,
Q4: 0.6%) as the contribution from higher broadband ARPU was
largely offset by the cumulative impact of broadband and TV
customer losses and lower regulated rates for terminating mobile
calls. Growth improved in Q4, as higher consumer mobile ARPU and
customer base growth was partially offset by a 0.9 percentage point
impact from the end to bulk TV contracting in Multi Dwelling Units
('MDUs').
Fixed service revenue increased by 0.3% (Q3: 1.0%, Q4: -0.2%) as
broadband ARPU growth was partially offset by the impact of a lower
broadband and TV customer base. The
slowdown in fixed service revenue growth in Q4 was primarily driven
by a 1.7 percentage point impact from changes to German TV
laws. Mobile
service revenue was stable year-on-year (Q3: -0.5%, Q4: +1.8%) as
ARPU growth and higher roaming and visitor revenue were offset by a
lower prepaid customer base and a reduction in mobile termination
rates. Mobile service revenue growth in Q4 improved having lapped
the renewal and rephasing of a large multi-year IoT contract last
year, which had adversely impacted prior quarters. Mobile service
revenue growth in Q4 was also supported by higher IoT project
revenue, consumer contract ARPU growth, and a higher customer base.
Vodafone Business service revenue was stable year-on-year (Q3:
-1.9%, Q4: +1.0%) as good demand for fixed services, including
cloud and security, was offset by a strong prior year performance
in public sector and lower IoT revenue following the renewal of a
major multi-year IoT automotive contract in the prior
year.
Adjusted EBITDAaL declined by 5.8%, reflecting a 2.7 percentage
point impact from higher energy costs. The decline also reflected
higher wage, inflation-linked lease costs, and customer acquisition
costs, as well as investments made to support the MDU transition.
The Adjusted EBITDAaL margin was 1.9 percentage points lower
year-on-year at 38.7%.
Customers
During the year, we re-engineered our commercial model and launched
a number of new products and services to better serve our
customers. In broadband, we restored our market leading network
quality position. This was reflected in four major independent
network test results from Connect, CHIP, Computer BILD and nPerf
where we achieved leading quality and reliability scores.
Reflecting inflationary pressure, we have increased the price of
our broadband packages. As expected, this impacted our commercial
performance with our broadband customer base declining by 392,000
during the year. Our converged customer base increased by 99,000 to
2.4 million.
Ahead of changes to German TV laws, which take effect from July
2024 and change the practice of bulk TV contracting in MDUs, we
have started migrating end users to new contracts at scale. Based
on our experience to date, we expect to retain around 50% of the
8.5 million MDU TV households. At the end of March 2024, we had
already actively retained 1.9 million households. Our total TV
customer base declined by 1.0 million during the year, primarily
due to the MDU transition, which began in the last quarter of
FY24.
We added 239,000 new mobile contract customers in FY24, supported
by our new propositions, the ongoing optimisation of sales channels
and an improved performance of Vodafone's own brands. We also added
8.0 million IoT connections, driven by continued strong demand from
the automotive sector. During the year, we agreed a long-term
national roaming partnership with 1&1. We expect to deliver
mobile coverage nationwide to 1&1's customers from the second
half of the 2024 calendar year. Our fibre-to-the-home ('FTTH')
joint venture, OXG Glasfaser, started its network rollout during
the year, initially in Neuss, Düsseldorf, Marburg and Kassel.
OXG Glasfaser will deploy FTTH to up to seven million homes over a
six-year period and is complementary to our upgrade plans for our
existing hybrid fibre cable network.
UK ⫶ Strong
growth in Consumer and Business
|
|
|
|
|
|
|
19%
|
|
€6.8bn
|
|
5.0%
|
|
of Group service revenue
|
Total revenue
|
Organic service revenue growth
|
|
|
|
|
|
|
13%
|
|
€1.4bn
|
|
4.0%
|
|
of Group Adjusted EBITDAaL
|
Adjusted EBITDAaL
|
Organic Adjusted EBITDAaL growth
|
|
|
|
|
|
|
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %1
|
Total revenue
|
6,837
|
6,824
|
0.2
|
|
- Service revenue
|
5,631
|
5,358
|
5.1
|
5.0
|
- Other revenue
|
1,206
|
1,466
|
|
|
Adjusted EBITDAaL
|
1,408
|
1,350
|
4.3
|
4.0
|
Adjusted EBITDAaL margin
|
20.6%
|
19.8%
|
|
|
Note:
1. Organic
growth is a non-GAAP measure. See page 36 for more information.
Growth
Total revenue increased by 0.2% to €6.8 billion as service
revenue growth was offset by a decline in equipment revenue.
Service revenue increased by 5.1% (Q3: 5.5%, Q4: 6.8%). Organic
growth in service revenue increased by 5.0% (Q3: 5.2%, Q4: 3.6%),
driven by continued strong growth in the Consumer and Business
segments. The lower service revenue growth in Q4 was driven by
Business following strong project revenue in prior
periods.
Mobile service revenue grew by 5.4% (Q3: 5.8%, Q4: 6.8%). Organic
growth in mobile service revenue was 5.4% (Q3: 5.4%, Q4: 3.7%),
driven by good commercial momentum, annual price increases, and
higher roaming revenue, partially offset by the
migration of the Virgin Media MVNO off our network. The lower
growth in Q4 was driven by a strong Business performance in prior
periods. Fixed service revenue grew by 4.1% (Q3: 4.6%, Q4: 7.0%).
Organic growth in fixed service revenue was 3.9% (Q3: 4.6%, Q4:
3.5%) driven by good Consumer customer base
growth.
Vodafone Business service revenue increased by 3.3% (Q3: 6.3%, Q4:
2.6%). Organic growth in Vodafone Business service revenue was 3.2%
(Q3: 5.8%, Q4: -0.5%), due to strong growth in mobile supported
by annual
price increases. Growth was also supported by
our IoT
business and during the year, we announced we will be providing IoT
connectivity to Britain's smart metering network through our
partnership with Data Communications Company ('DCC'). Fixed sales
momentum continued to improve throughout the year. We also
announced a new channel called Business IT Hubs, which is planning
to establish 300 franchise partners to help SMEs better manage
their IT solutions.
Adjusted EBITDAaL increased by 4.3% in the year. On an organic
basis, Adjusted EBITDAaL increased by 4.0%, with strong service
revenue growth, partially offset by a 1.8 percentage point impact
from higher energy costs, and the migration of the Virgin Media
MVNO off our network. The adjusted EBITDAaL margin improved by 0.8
percentage points year-on-year on a reported and organic basis to
20.6%.
Customers
During the year our mobile contract customer base continued to
grow, however this was offset by low value disconnections in
Business. In the second half of the year, we were recognised as a
Consumer NPS co-leader in the market and we are now the joint
lowest complained about mobile operator, as measured by Ofcom,
reflecting the significant improvements and investment we have made
to our customer experience over the last few years. Our digital
prepaid sub-brand 'VOXI' continued to grow, with 120,000 customers
added during the year. Through our partnerships with CityFibre and
Openreach we can now reach 15.3 million households with full fibre
broadband, more than any other provider in the UK. We are one of
the fastest growing broadband providers in the UK and our broadband
customer base increased by 160,000.
Portfolio
In June 2023, we announced a binding agreement to combine our UK
business with Three UK to create a sustainable, and competitive
third scaled network operator in the UK. Following the merger,
which we expect to close around the end of the 2024 calendar year,
Vodafone and CK Hutchison will own 51% and 49% of the combined
business, respectively. This combination is expected to provide
customers with greater choice and more value, drive greater
competition, and enable increased investment with a clear £11
billion plan to create one of Europe's most advanced standalone 5G
networks. Full details of the transaction can be found
here: investors.vodafone.com/merger-of-vodafone-uk-and-three-uk.
Other Europe1 ⫶ Service
revenue growth in all markets
|
|
|
|
|
|
|
|
|
16%
|
|
€5.5bn
|
|
4.2%
|
|
of Group service revenue
|
Total revenue
|
Organic service revenue growth
|
|
|
|
|
|
|
14%
|
|
€1.5bn
|
|
1.5%
|
|
of Group Adjusted EBITDAaL
|
Adjusted EBITDAaL
|
Organic Adjusted EBITDAaL growth
|
|
|
|
|
|
|
|
|
FY24
|
FY231
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %2
|
Total revenue
|
5,504
|
5,744
|
(4.2)
|
|
- Service revenue
|
4,722
|
5,005
|
(5.7)
|
4.2
|
- Other revenue
|
782
|
739
|
|
|
Adjusted EBITDAaL
|
1,516
|
1,632
|
(7.1)
|
1.5
|
Adjusted EBITDAaL margin
|
27.5%
|
28.4%
|
|
|
Notes:
1. Other
Europe markets comprise Portugal, Ireland, Greece, Romania, Czech
Republic and Albania. The comparative metrics include the results
of Vodafone Hungary which, as previously reported, was sold in
January 2023.
2. Organic
growth is a non-GAAP measure. See page 36 for more
information.
Growth
Total revenue declined by 4.2% to €5.5 billion, reflecting
the disposal of Vodafone Hungary in the prior
year. Service
revenue decreased by 5.7% (Q3: -7.8%, Q4: +0.3%). Organic growth in
service revenue increased
by 4.2% (Q3: 3.6%, Q4: 5.5%), with all six markets growing during
the year, supported by good commercial momentum and our price
actions in most markets. The acceleration in quarterly trends was
driven by public sector project work.
In Portugal, both our Consumer and Business segments continued to
perform well, also supported by inflation-linked contractual price
increases implemented in March 2023. In Ireland, service revenue
increased, driven by a higher average customer base, and supported
by our annual contractual price increases. Service revenue in
Greece grew, reflecting strong demand for Business fixed
services.
Vodafone Business service revenue increased by 0.4% (Q3: -1.3%, Q4:
8.1%). Organic growth in Vodafone Business service revenue was 7.9%
(Q3: 7.8%, Q4: 12.2%) during the year, with growth in both
connectivity and digital services, including IoT and Cloud. Growth
in connectivity was supported by a higher customer base, price
increases in the Soho and SME customer segments across our markets
and growth in digital services, with public sector contract wins in
Romania.
Adjusted EBITDAaL decreased by 7.1% in the year. On an organic
basis, Adjusted EBITDAaL grew by 1.5%, as service revenue growth
and ongoing cost efficiencies were offset by the 0.6 percentage
point impact from higher energy costs, as well as one-off bad debt
impacts in relation to certain customer contracts in Greece. The
Adjusted EBITDAaL margin decreased by 0.9 percentage points
year-on-year (organic: -1.4 percentage points) at
27.5%.
Customers
During FY24, we maintained our good commercial momentum. In
Portugal, we added 167,000 mobile contract customers and 58,000
fixed broadband customers. In Ireland, our mobile contract
customers base increased by 30,000. Through our fixed wholesale
network access partnerships, we now cover over 1.4 million
households in Ireland with FTTH. In Greece, we added 146,000 mobile
contract customers, and our broadband customer base declined by
12,000.
Portfolio
In September 2022, we announced that we had entered into an
agreement to buy Portugal's fourth largest converged operator, Nowo
Communications, from Llorca JVCO Limited, the owner of Masmovil
Ibercom S.A. The transaction is conditional on regulatory approval.
We submitted proposed remedies which were rejected in early 2024.
After reviewing the competition authority's comments and exploring
further options to address the authority's concerns, we submitted
revised proposals that are currently being considered by the
competition authority.
Turkey ⫶ Outperforming
in an inflationary environment
|
|
|
|
|
|
|
6%
|
|
€2.4bn
|
|
88.5%
|
|
of Group service revenue
|
Total revenue
|
Organic service revenue growth
|
|
|
|
|
|
|
5%
|
|
€0.5bn
|
|
99.9%
|
|
of Group Adjusted EBITDAaL
|
Adjusted EBITDAaL
|
Organic Adjusted EBITDAaL growth
|
|
|
|
|
|
|
|
|
Turkey
|
Turkey and Ghana1
|
|
|
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %2
|
Total revenue
|
2,362
|
2,072
|
14.0
|
|
- Service revenue
|
1,746
|
1,593
|
9.6
|
88.5
|
- Other revenue
|
616
|
479
|
|
|
Adjusted EBITDAaL
|
510
|
424
|
20.3
|
99.9
|
Adjusted EBITDAaL margin
|
21.6%
|
20.5%
|
|
|
Notes:
1. The
comparative period includes the results of Vodafone Ghana which was
sold in February 2023 (previously reported within Other Markets,
which also included Turkey).
2. Organic
growth is a non-GAAP measure. See page 36 for more
information.
Growth
Total revenue increased by 14.0% to €2.4 billion, with strong
service revenue growth partly offset by a significant devaluation
of the local currency and the disposal of Vodafone Ghana in the
prior financial year.
Despite material currency devaluation, service
revenue increased in
euro terms by
9.6% (Q3:6.8%, Q4: 15.6%). Organic growth in service
revenue in
Turkey was 88.5% (Q3: 90.4%, Q4: 105.6%), driven by ongoing
repricing actions to reflect the high inflationary environment and
value accretive base management activities.
Vodafone Business service revenue increased by 20.1% (Q3: 20.5%,
Q4: 20.3%). Organic growth in Vodafone Business service revenue was
87.4% (Q3: 94.7%, Q4: 102.2%) during the year, driven by higher
connectivity revenue and strong Business demand for our cloud and
IoT services. In February 2024, we announced our partnership with
DAMAC to build a new data centre in Izmir.
Adjusted EBITDAaL increased by 20.3% in the year, growing in euro
terms during FY24. On an organic basis, adjusted EBITDAaL in Turkey
increased by 99.9%, supported by ongoing digitalisation and our
continued focus on cost efficiency, in the context of significant
inflationary pressure on our cost base. The Adjusted EBITDAaL
margin increased by 1.1 percentage points year-on-year (organic:
1.0 percentage points) at 21.6%.
Customers
We maintained our good commercial momentum, adding 1.4 million
mobile contract customers during the year, including migrations of
prepaid customers. We also increased investments to improve our
networks after the earthquake in the prior year.
Hyperinflationary accounting in Turkey
Turkey was designated as a hyperinflationary economy on 1 April
2022 in line with IAS 29 'Financial Reporting in Hyperinflationary
Economies'. See note 1 'Basis of preparation' in the condensed
consolidated financial statements for further
information.
Organic growth metrics exclude the impact of the hyperinflation
adjustment and foreign exchange translation in Turkey. On an
organic basis, Group service revenue growth excluding Turkey was
3.7% (Q3: 3.6%, Q4: 4.0%) and adjusted EBITDAaL excluding Turkey
declined by 0.6%.
Africa ⫶ Resilient
performance
|
|
|
|
|
|
|
20%
|
|
€7.4bn
|
|
9.2%
|
|
of Group service revenue
|
Total revenue
|
Organic service revenue growth
|
|
|
|
|
|
|
23%
|
|
€2.5bn
|
|
6.4%
|
|
of Group Adjusted EBITDAaL
|
Adjusted EBITDAaL
|
Organic Adjusted EBITDAaL growth
|
|
|
|
|
|
|
|
|
|
Re-presented1
|
|
|
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %2
|
Total revenue
|
7,420
|
8,076
|
(8.1)
|
|
- Service revenue
|
5,951
|
6,556
|
(9.2)
|
9.2
|
- Other revenue
|
1,469
|
1,520
|
|
|
Adjusted EBITDAaL
|
2,539
|
2,880
|
(11.8)
|
6.4
|
Adjusted EBITDAaL margin
|
34.2%
|
35.7%
|
|
|
Notes:
1. The
comparative metrics for FY23 have been re-presented to reflect the
move of Vodafone Egypt to Vodacom from 1 April 2023 and the segment
has been re-named Africa.
2. Organic
growth is a non-GAAP measure. See page 36 for more
information.
Growth
Total revenue declined by 8.1% to €7.4 billion due to the
depreciation of local currencies versus the euro. Service revenue
decreased by 9.2% (Q3: -7.5%, Q4: +1.2%). Organic growth in service
revenue grew
by 9.2% (Q3: 8.8%, Q4: 10.0%) with growth in South Africa, Egypt
and Vodacom's international markets.
In South Africa, service revenue growth was supported by the
Consumer mobile contract segment, which benefited from a price
increase in the first quarter, and good fixed line growth in
Consumer and Business. Growth slowed in Q4 due to a strong prior
year comparative, reflecting an acceleration in customer data usage
during widespread power outages, and pressure on wholesale revenue.
Financial services revenue grew by 7.9% to €156.9 million on
an organic basis, supported by growth in our insurance
services.
Service revenue in Egypt grew strongly during the year and
accelerated in Q4, above inflation. The acceleration was supported
by sustained customer base growth, price increases in mobile and
fixed, robust demand for data and strong growth in our financial
services product, 'Vodafone Cash'. Vodafone Cash revenue more than
doubled in FY24 to €95.8 million.
In Vodacom's international markets, service revenue growth was
supported by a higher customer base and strong M-Pesa and data
revenue growth. M-Pesa revenue grew by 13.4% on an organic basis
and now represents 26.8% of service revenue.
Adjusted EBITDAaL declined by 11.8% during the year. On an organic
basis, adjusted EBITDAaL increased by 6.4%, supported by service
revenue growth and cost initiatives, partially offset by an
increase in technology operating expenses associated with higher
energy costs. The Adjusted EBITDAaL margin decreased by 1.5
percentage points year-on-year (organic: -1.1 percentage points) to
34.2%.
Customers
In South Africa, we added 125,000 contract customers in the year,
and now have a mobile contract base of 6.8 million. We added 5.7
million mobile prepaid SIMs in the year, supported by our big data
led customer value management capabilities which offer personalised
bundles to customers. Across our active customer base, 81.5% of our
mobile customers now use data services, an increase of 3.3 million
year-on-year. Our 'VodaPay' super-app continued to gain traction
with 5.8 million registered users.
In Egypt, we added 437,000 contract customers and 2.4 million
prepaid mobile customers during the year, and we now have 48.3
million customers. 'Vodafone Cash' now has 8.2 million active users
with 2.8 million users added during the year.
In Vodacom's international markets, we added 4.0 million mobile
customers and our mobile customer base is now 54.2 million, with
63.5% of active customers using our data services.
Further information on our operations in Africa can be accessed
here: vodacom.com.
Discontinued operations
|
|
|
|
|
|
|
Italy
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %1
|
Total revenue
|
4,668
|
4,809
|
(2.9)
|
|
- Service revenue
|
4,184
|
4,251
|
(1.6)
|
(1.6)
|
- Other revenue
|
484
|
558
|
|
|
Note:
1. Organic
growth is a non-GAAP measure. See page 36 for more information.
On 15 March 2024, we announced that we had entered into a binding
agreement to sell Vodafone Italy to Swisscom AG for €8
billion upfront cash proceeds (subject to customary closing
adjustments). Completion is expected to take place during the first
half of the 2025 calendar year. Full details of the transaction can
be found here: investors.vodafone.com/sale-of-vodafone-italy. The
Group recorded a non-cash charge of €83 million, included in
discontinued operations as a result of the re-measurement of
Vodafone Italy to fair value less costs to sell. See note 3 to the
condensed consolidated financial statements for further
information.
Total revenue declined 2.9% to €4.7 billion due to lower
service revenue and equipment revenue. Service revenue declined by
1.6% (Q3: -1.3%, Q4: -2.5%), as continued price pressure in the
mobile value segment was only partly offset by strong Business
demand for our fixed line connectivity and digital services.
Vodafone Business service revenue increased by 7.6% (Q3: 7.5%, Q4:
6.1%) during the year, driven by strong fixed connectivity and
digital services growth.
|
|
|
|
|
|
Spain
|
|
FY24
|
FY23
|
Reported
|
Organic
|
|
€m
|
€m
|
change %
|
change %1
|
Total revenue
|
3,846
|
3,907
|
(1.6)
|
|
- Service revenue
|
3,429
|
3,514
|
(2.4)
|
(2.4)
|
- Other revenue
|
417
|
393
|
|
|
Note:
1. Organic
growth is a non-GAAP measure. See page 36 for more information.
On 31 October 2023, we announced that we had entered into binding
agreements with Zegona Communications plc in relation to the sale
of 100% of Vodafone Spain. We expect final approval from the
Spanish authorities to be granted imminently, with completion to
occur shortly thereafter. On completion, we will receive €4.1
billion in cash (subject to customary closing adjustments) and
€0.9 billion in the form of Redeemable Preference Shares,
which redeem no later than six years after closing. Vodafone and
Zegona have entered into an agreement whereby Vodafone will provide
certain services to Vodafone Spain after completion of the
transaction and Vodafone will continue to have a presence in Spain
through its Innovation Hub in Malaga. Full details of the
transaction can be found here: investors.vodafone.com/sale-of-vodafone-spain.
The Group recorded a non-cash charge of €345 million,
included in discontinued operations as a result of the
re-measurement of Vodafone Spain to fair value less costs to sell.
See note 3 to the condensed consolidated financial statements for
further information.
Total revenue declined by 1.6% to €3.8 billion due to lower
service revenue. Service revenue declined by 2.4% (Q3: -1.1%, Q4:
-2.9%) due to continued price competition in the Consumer value
segment, a lower customer base and a reduction in mobile
termination rates. Vodafone Business service revenue declined by
1.2% (Q3: +2.2%, Q4: -2.7%) as lower mobile connectivity revenue,
due to price competition in the SoHo customer segment, was only
partially offset by good demand for Business digital services,
particularly in Q3.
Vodafone Investments
|
|
|
|
|
|
|
Associates and joint ventures
|
FY24
|
FY23
|
€m
|
€m
|
Vantage Towers (Oak Holdings 1 GmbH)
|
(85)
|
-
|
VodafoneZiggo Group Holding B.V.
|
(177)
|
137
|
Safaricom Limited
|
159
|
195
|
Indus Towers Limited
|
140
|
50
|
Other1 (including
TPG Telecom Limited)
|
(133)
|
51
|
Share of results of equity accounted associates and joint
ventures
|
(96)
|
433
|
|
|
|
|
Note:
1. The
Group's investment in Vodafone Idea Limited ('VIL') was reduced to
€nil in the year ended 31 March 2020 and the Group has not
recorded any profit or loss in respect of its share of VIL's
results since that date.
Vantage Towers - 53.9% ownership
On 23 March 2023, we announced
the completion of Oak Holdings GmbH, our co-control partnership for
Vantage Towers with a consortium of long-term infrastructure
investors led by Global Infrastructure Partners and KKR. We
received initial net proceeds of €4.9 billion in March 2023,
and a further €500 million in July 2023, taking total net
proceeds to €5.4 billion and the Consortium's ownership in
Oak Holdings GmbH to 40%. During the year, total revenue increased
6.3% to €1.1 billion, driven by 2,400 net new tenancies and
1,100 new macro sites. As a result, the tenancy ratio increased to
1.50x. Vodafone's share of results in FY24 reflects the
amortisation of intangible assets arising from the completion of
the co-control partnership for Vantage Towers. During
the year, Vodafone received €196 million in dividends from
Vantage Towers.
VodafoneZiggo Joint Venture (Netherlands) - 50.0%
ownership
The
results of VodafoneZiggo are prepared under US GAAP, which is
broadly consistent with Vodafone's IFRS basis of reporting. Total
revenue increased 1.5% to €4.1 billion, as contractual price
increases and mobile contract customer growth were partially offset
by a decline in the fixed customer base. During the year,
VodafoneZiggo added 129,000 mobile contract customers.
VodafoneZiggo's broadband customer base declined by 115,000
customers to 3.2 million due to the competitive price environment.
The number of converged households increased by 20,000 and 48% of
broadband customers are now converged, delivering significant NPS
and customer loyalty benefits. VodafoneZiggo now offers gigabit
speeds to 7.5 million homes, providing nationwide coverage.
Vodafone's lower share of results in FY24 was largely due to lower
adjusted EBITDA, lower gains on derivative financial instruments
and higher third-party interest expenses. During the year, Vodafone
received €100 million in equity distributions and €51
million in interest payments from the joint venture.
Safaricom Associate (Kenya) - 27.8% ownership
Safaricom
service revenue declined to €2.1 billion, as the devaluation
of the local currency was only partially offset by a higher
customer base and strong mobile data and M-Pesa growth. Vodafone's
lower share of results was due to the depreciation of the Kenyan
shilling versus the euro. During the year, Vodafone received
€122 million in dividends from Safaricom.
Indus Towers Limited Associate (India) - 21.0%
ownership
Following
the sale of shares in Indus Towers Limited ('Indus Towers') in
February and March 2022, the Group holds 567.2 million shares in
Indus Towers. Vodafone's higher share of results in FY24 was
largely due to higher adjusted EBITDAaL.
Vodafone Idea Limited Joint Venture (India) - 31.4%
ownership
See
note 4 'Contingent liabilities and legal proceedings' in the
condensed consolidated financial statements for more
information.
Vodafone Idea Limited has undertaken equity fund-raisings totalling
€2.2 billion since 31 March 2024, reducing the Group's
shareholding to 23.2%.
TPG Telecom Limited
Joint Venture (Australia) - 25.1% ownership
TPG
Telecom Limited is a fully integrated telecommunications operator
in Australia. Hutchison Telecommunications (Australia) Limited owns
an equivalent economic interest of 25.1%, with the remaining 49.9%
listed as free float on the Australian stock exchange. We also hold
a 50% share of loan facilities of AU$2.5 billion, US$1.0 billion
and €0.6 billion (2023: US$3.5 billion) held within the
structure that holds the Group's equity stake in TPG Telecom.
During the year, Vodafone received €23 million in dividends
from TPG Telecom.
Net financing costs
|
|
|
|
|
|
|
Re-presented1
|
|
|
|
FY24
|
FY23
|
Reported
|
|
|
€m
|
€m
|
change %
|
Investment income
|
581
|
232
|
|
Financing costs
|
(2,626)
|
(1,609)
|
|
Net financing costs
|
(2,045)
|
(1,377)
|
(48.5)
|
Adjustments for:
|
|
|
|
|
Mark-to-market losses
|
97
|
(534)
|
|
|
Foreign exchange losses
|
173
|
135
|
|
Adjusted net financing costs2
|
(1,775)
|
(1,776)
|
0.1
|
Notes:
1. The results
for the year ended 31 March 2023 have been re-presented to reflect
that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
2.
Adjusted net financing costs is a non-GAAP measure. See page 36 for
more information.
Net financing costs increased by €668 million, primarily due
to year-on-year changes of mark-to-market gains recycled from
reserves on derivatives that were previously in cash flow hedge
relationships and mark-to-market movements on the revaluation of
the embedded derivative option linked to the Group's bank
borrowings secured against Indian assets.
Adjusted net financing costs are in line with prior year,
reflecting both a decrease in average net debt balances and higher
returns on cash and short-term investments, offset by interest
movements on lease liabilities and other items outside of net
debt.
|
|
|
|
|
Taxation
|
|
|
|
|
|
|
Re-presented1
|
|
|
|
FY24
|
FY23
|
Change
|
|
%
|
%
|
pps
|
Effective tax rate
|
3.1%
|
3.8%
|
(0.7)
|
Adjusted effective tax rate2
|
24.5%
|
25.6%
|
(1.1)
|
Notes:
1. The results
for the year ended 31 March 2023 have been re-presented to reflect
that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
2.
Adjusted effective tax rate is a non-GAAP measure. See page 36 for
more information.
The Group's effective tax rate ('ETR') for the year ended 31 March
2024 was 3.1%, (FY23: 3.8%). The rate remains low following the
recognition of a €1,019 million deferred tax asset on losses
in Luxembourg as a result of favourable case law during the year.
The ETR also reflects a tax credit of €249 million (2023:
€309 million) relating to the impacts of inflation in
Turkey.
The year ended 31 March 2023 included gains on the disposals of
Vantage Towers and Vodafone Ghana which were largely exempt from
tax, except for a €88 million charge relating to the disposal
of Vantage Towers, as well as the hyperinflation accounting impacts
in Turkey and utilisation of losses in Luxembourg.
The Group's Adjusted ETR ('AETR') for the year ended 31 March 2024
was 24.5% (FY23: 25.6%). The AETR excludes the recognition of a
deferred tax asset in Luxembourg, the impact of a €598
million tax charge (2023: €33 million) relating to the use of
losses in Luxembourg and the effects of inflation in
Turkey.
The charge on losses in Luxembourg is higher than the prior year
because of an internal restructuring in 2023 which resulted in a
loss. As a result of that restructuring, profits in Luxembourg are
no longer subject to changes in the value of investments. The
effects of hyperinflation accounting in Turkey, and the tax charge
relating to the disposal of Vantage Towers in 2023, are set out
above.
The main drivers for the reduction in the AETR are the mix of
profits between jurisdictions in 2024 compared to 2023 and Vodafone
Spain moving to discontinued operations accounting in 2024 as
previously the non-recognition of tax losses in Spain increased
AETR.
Earnings per share
|
|
|
|
|
|
|
Re-presented1
|
Reported
|
|
|
FY24
|
FY23
|
change
|
|
|
eurocents
|
eurocents
|
eurocents
|
Basic earnings per share - Continuing operations
|
4.45c
|
43.66c
|
(39.21)c
|
Basic earnings per share - Total Group
|
4.21c
|
42.77c
|
(38.56)c
|
|
|
|
|
|
Adjusted basic earnings per share2
|
7.47c
|
11.28c
|
(3.81)c
|
Notes:
1. The results
for the year ended 31 March 2023 have been re-presented to reflect
that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
2. Adjusted
basic earnings per share is a non-GAAP measure. See page 36 for
more information.
Basic earnings per share from continuing operations was 4.45
eurocents, compared to 43.66 eurocents for FY23. The decrease was
primarily due to gains on disposal in the prior year of Vantage
Towers A.G. and Vodafone Ghana, partially offset by the loss on the
disposal of Vodafone Hungary.
Adjusted basic earnings per share was 7.47 eurocents, compared to
11.28 eurocents for FY23. The decrease was primarily due to lower
Adjusted EBITDAaL.
Cash flow & funding
|
|
|
|
|
|
|
|
|
|
Analysis of cash flow
|
|
|
|
FY24
|
FY23
|
Reported
|
|
€m
|
€m
|
change %
|
Inflow from operating activities
|
16,557
|
18,054
|
(8.3)
|
Outflow from investing activities
|
(6,122)
|
(379)
|
(1,515.3)
|
Outflow from financing activities
|
(15,855)
|
(13,430)
|
(18.1)
|
Net cash outflow
|
(5,420)
|
4,245
|
(227.7)
|
Cash and cash equivalents at beginning of the financial
year
|
11,628
|
7,371
|
|
Exchange gain on cash and cash equivalents
|
(94)
|
12
|
|
Cash and cash equivalents at the end of the financial
year
|
6,114
|
11,628
|
|
|
|
|
|
|
Cash inflow from operating activities decreased to €16,557
million reflecting lower operating profit, excluding a lower share
of results in equity accounted associates and joint ventures and a
net gain in the prior year resulting from the sale of Vantage
Towers, Vodafone Ghana and Vodafone Hungary, and adverse working
capital movements, which offset lower taxation
payments.
Outflows from investing activities increased to €6,122
million, primarily in relation to the decrease in proceeds received
in the prior year from disposal of interests in subsidiaries and a
lower net inflow in respect of short-term investments, which
outweighed proceeds from the sale of 3.9% of Oak Holdings 1 GmbH
and the decrease in the purchase of intangible assets and property,
plant and equipment in the year. Short-term investments include
highly liquid government and government-backed securities and
managed investment funds that are in highly rated and liquid money
market investments with liquidity of up to 90 days.
Outflows from financing activities increased to €15,855
million as higher net cash outflows in respect of borrowings,
primarily arising from movements in collateral balances, outweighed
lower outflows in relation to the purchase of treasury shares and
in respect of discontinued operations.
Analysis of cash flow (continued)
|
|
Re-presented1
|
|
|
FY24
|
FY23
|
Reported
|
|
€m
|
€m
|
change %
|
Adjusted EBITDAaL2
|
11,019
|
12,424
|
(11.3)
|
Capital additions3
|
(6,331)
|
(7,067)
|
|
Working capital
|
(309)
|
377
|
|
Disposal of property, plant and equipment and intangible
assets
|
14
|
90
|
|
Integration capital additions
|
(81)
|
(200)
|
|
Restructuring costs including working capital
movements4
|
(254)
|
(249)
|
|
Licences and spectrum
|
(454)
|
(773)
|
|
Interest received and paid5
|
(1,279)
|
(1,172)
|
|
Taxation
|
(724)
|
(1,228)
|
|
Dividends received from associates and joint ventures
|
442
|
617
|
|
Dividends paid to non-controlling shareholders in
subsidiaries
|
(260)
|
(400)
|
|
Other
|
-
|
164
|
|
Free cash flow2
|
1,783
|
2,583
|
(31.0)
|
Acquisitions and disposals
|
(346)
|
8,727
|
|
Equity dividends paid
|
(2,430)
|
(2,484)
|
|
Share buybacks5
|
-
|
(1,893)
|
|
Foreign exchange gain/(loss)
|
(64)
|
141
|
|
Other movements in net debt6
|
1,065
|
(613)
|
|
Net debt decrease2
|
8
|
6,461
|
|
Opening net debt2
|
(33,250)
|
(39,711)
|
|
Closing net debt2
|
(33,242)
|
(33,250)
|
-
|
Net debt of Vodafone Spain and Vodafone Italy2
|
(107)
|
(125)
|
|
Closing net debt incl. Vodafone Spain
and Vodafone Italy2
|
(33,349)
|
(33,375)
|
0.1
|
|
|
|
|
Free cash flow2
|
1,783
|
2,583
|
|
Adjustments:
|
|
|
|
- Licences and spectrum
|
454
|
773
|
|
- Restructuring costs including working capital
movements4
|
254
|
249
|
|
- Integration capital additions
|
81
|
200
|
|
- Vantage Towers growth capital expenditure
|
-
|
497
|
|
- Other adjustments7
|
28
|
(163)
|
|
Adjusted free cash flow2
|
2,600
|
4,139
|
|
Notes:
1. The results
for the year ended 31 March 2023 have been re-presented to reflect
that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
2. Adjusted
EBITDAaL, Free cash flow, Adjusted free cash flow and Net debt are
non-GAAP measures. See page 36 for more
information.
3. See
page 49 for an analysis of tangible and intangible additions in the
year.
4. Includes
working capital in respect of integration capital
additions.
5. Interest
received and paid excludes €406 million outflow (FY23:
€296 million) in relation to the cash portion of interest on
lease liabilities included within Adjusted EBITDAaL, and €nil
of cash flow (FY23: €26 million outflow) from the option
structures relating to the issue of the mandatory convertible bonds
which is included within Share buybacks. The share buyback
programmes completed on 15 March 2023.
6. Other
movements in net debt for FY24 includes a net inflow from
discontinued operations of €455 million (FY23: €1,175
million outflow), mark-to-market losses recognised in the income
statement of €97 million (FY23: €534 million gain) and
of €185 million (FY23: €371 million) for the repayment
of debt in relation to licences and spectrum.
7. The
amount for FY23 includes €120 million received in respect of
the Group's fibre joint venture in Germany and an allocation of
€43 million from the Vodafone Hungary proceeds for future
services to be provided by the Group.
Adjusted free cash flow decreased by €1,539 million to
€2,600 million in the period. This reflects a decrease in
Adjusted EBITDAaL in the period, adverse working capital movements
and lower dividends from associates and joint ventures, which
outweighed lower capital additions, lower taxation, and lower
dividends paid to non-controlling shareholders in
subsidiaries.
Acquisitions and disposals includes €500 million in relation
to the disposal of 3.9% of Oak Holdings 1 GmbH in the year, offset
by a final payment of €494 million to settle the Group's
obligations to the minority shareholders in Kabel Deutschland
Holding A.G.
Borrowings and cash position
|
|
|
|
|
|
FY24
|
FY23
|
Reported
|
|
|
€m
|
€m
|
change %
|
Non-current borrowings
|
(48,328)
|
(51,669)
|
|
Current borrowings
|
(8,659)
|
(14,721)
|
|
Borrowings
|
(56,987)
|
(66,390)
|
|
Cash and cash equivalents
|
6,183
|
11,705
|
|
Borrowings less cash and cash equivalents
|
(50,804)
|
(54,685)
|
7.1
|
Borrowings principally includes bonds of €40,743 million
(€44,116 million as at 31 March 2023), lease liabilities of
€9,672 million (€13,364 million as at 31 March 2023),
cash collateral liabilities of €2,628 million (€4,886
million as at 31 March 2023) and €1,720 million (€1,485
million as at 31 March 2023) of bank borrowings that are secured
against the Group's shareholdings in Indus Towers and Vodafone
Idea.
The decrease in borrowings of €9,403 million was principally
driven by repayment of bonds of €4,847 million, a decrease in
collateral liabilities of €2,258 million and the transfer of
borrowings in Italy and Spain to discontinued operations
(€3,553 million), offset by the issuance of new bonds of
€1,314 million.
|
|
|
|
|
Funding position
|
|
|
|
|
FY24
|
FY23
|
Reported
|
|
|
€m
|
€m
|
change %
|
Bonds
|
(40,743)
|
(44,116)
|
|
Bank loans
|
(767)
|
(795)
|
|
Other borrowings including spectrum
|
(1,457)
|
(1,744)
|
|
Gross debt1
|
(42,967)
|
(46,655)
|
7.9
|
Cash and cash equivalents
|
6,183
|
11,705
|
|
Short-term investments2
|
3,225
|
4,305
|
|
Derivative financial instruments3
|
2,204
|
1,917
|
|
Net collateral liabilities4
|
(1,887)
|
(4,647)
|
|
Net debt1
|
(33,242)
|
(33,375)
|
0.4
|
Notes:
1. Gross
debt and Net debt are non-GAAP measures. See page 36 for more
information.
2. Short-term
investments includes €1,201 million (FY23: €1,338
million) of highly liquid government and government-backed
securities and managed investment funds of €2,024 million
(FY23: €2,967 million) that are in highly rated and liquid
money market investments with liquidity of up to 90
days.
3. Derivative
financial instruments excludes derivative movements in cash flow
hedging reserves of €498 million gain (FY23: €2,785
million gain).
4. Collateral
arrangements on derivative financial instruments result in cash
being held as security. This is repayable when derivatives are
settled and is therefore deducted from
liquidity.
Net debt decreased by €133 million to €33,242 million.
This was driven by the free cash inflow of €1,783 million
together with other movements of €1,065 million, offset by
acquisitions and disposals of €346 million and equity
dividends of €2,430 million.
Other funding considerations include:
|
FY24
|
FY23
|
|
|
|
€m
|
€m
|
|
Lease liabilities
|
(9,672)
|
(13,364)
|
|
Financial liabilities under put options (KDG minority
interests)
|
-
|
(485)
|
|
Net pension fund liabilities
|
(196)
|
(258)
|
|
Guarantees over loan issued by Australia joint venture
|
(1,479)
|
(1,611)
|
|
Equity characteristic of 50% attributed by credit rating agencies
to 'Hybrid bonds' included in net debt of €8,993 million
(€9,942 million as at 31 March 2023)
|
4,497
|
4,971
|
|
|
|
|
|
|
The Group's gross and net debt includes certain bonds which have
been designated in hedge relationships, which are carried at
€1,229 million higher value (€1,282 million higher as
at 31 March 2023) than their euro equivalent redemption value. In
addition, where bonds are issued in currencies other than the euro,
the Group has entered into foreign currency swaps to fix the euro
cash outflows on redemption. The impact of these swaps is not
reflected in gross debt and if it were included, the euro
equivalent value of the bonds would decrease by €1,559
million (€1,440 million as at 31 March 2023).
Return on capital employed
Return on capital employed
('ROCE') reflects how efficiently we are generating profit with the
capital we deploy. We calculate two ROCE measures: i)
Pre-tax ROCE for controlled operations only and ii) Post-tax ROCE
including associates and joint ventures. ROCE calculated using GAAP
measures for the 12 months ended 31 March 2024 was 3.4% (FY23:
13.0%), impacted by gains
on disposal in the prior year of Vantage Towers A.G. and Vodafone
Ghana, partially offset by the loss on the disposal of Vodafone
Hungary.
The table below presents adjusted ROCE metrics.
|
|
Re-presented1
|
|
|
FY242
|
FY232
|
Change
|
|
%
|
%
|
pps
|
Pre-tax ROCE
(controlled)2,3
|
7.5%
|
8.2%
|
(0.7)
|
Post-tax ROCE (controlled and
associates/joint ventures)2,3
|
4.5%
|
6.1%
|
(1.6)
|
Notes:
1. The results
for the year ended 31 March 2023 have been re-presented to reflect
that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
2. FY23
ROCE calculations exclude the results of Vantage Towers until its
disposal on 22 March 2023 and the investment in Oak Holdings 1 GmbH
from that date. FY23 capital employed for calculating post-tax ROCE
(controlled and associates/joint ventures), FY22 Capital employed
for calculating pre-tax ROCE (controlled) and FY22 capital employed
for calculating post-tax ROCE (controlled and associates/joint
ventures) have been adjusted to €57,911 million,
€56,192 million and €61,515 million, respectively, for
the purposes of calculating relevant FY23
averages.
3. ROCE
is calculated by dividing Operating profit by the average of
capital employed as reported in the consolidated statement of
financial position. Pre-tax ROCE (controlled) and Post-tax ROCE
(controlled and associates/joint ventures) are non-GAAP measures.
See page 36 for more information.
Funding facilities
As at 31 March 2024, the Group had undrawn revolving credit
facilities of €7.8 billion comprising euro and US dollar
revolving credit facilities of €4.1 billion and US$4.0
billion (€3.7 billion) which mature in 2029 and 2028
respectively. Both committed revolving credit facilities support US
and euro commercial paper programmes of up to US$15 billion
(€13.9 billion) and €10 billion
respectively.
Post employment benefits
As at 31 March 2024,
the Group's
net surplus of scheme assets over scheme liabilities was €76
million (€71 million net surplus as at 31 March
2023).
Dividends
Dividends
will continue to be declared in euros, aligning the Group's
shareholder returns with the primary currency in which we generate
free cash flow, and paid in euros, pounds sterling and US dollars.
The foreign exchange rate at which future dividends declared in
euros will be converted into pounds sterling and US dollars will be
calculated based on the average World Markets Company benchmark
rates over the five business days during the week prior to the
payment of the dividend.
The Board is recommending total dividends per share of 9.0
eurocents for the year. This includes a final dividend of 4.5
eurocents compared to 4.5 eurocents in the prior year.
The ex-dividend date for the final dividend is 6 June 2024 for
ordinary shareholders and 7 June 2024 for ADR holders, the record
date is 7 June 2024 and the dividend is payable on 2 August 2024.
Shareholders may elect to receive their dividend in either
eurocents or GBP and the last day for election will be 12 July
2024. Alternatively, shareholders may participate in the dividend
reinvestment plan and elections must be made by 12 July 2024. More
information can be found at vodafone.com/dividends
Other significant developments
|
|
|
Executive Committee changes
The following changes were effective from 1 April
2024:
−
Ahmed Essam was
appointed Executive Chairman Vodafone Germany and CEO European
markets. Ahmed Essam was previously CEO Vodafone UK and remains a
member of the Executive Committee.
−
Serpil Timuray,
previously CEO Europe Cluster, was appointed CEO Vodafone
Investments and is responsible for the Group's joint ventures,
partner markets and the development of new telecom partnerships.
Serpil remains a member of the Executive
Committee.
−
Philippe Rogge,
previously CEO Vodafone Germany and member of the Executive
Committee, decided to step down and leave
Vodafone.
Marika Auramo has been appointed CEO of Vodafone Business and a
member of the Executive Committee, effective 1 July
2024.
Other leadership changes
Max
Taylor, previously Chief Commercial Officer of Vodafone UK, has
been appointed CEO of Vodafone UK.
Marcel de Groot, previously Consumer Business Director, has been
appointed CEO of Vodafone Germany.
Condensed consolidated financial statements
|
|
|
|
|
|
|
|
Consolidated income statement
|
|
|
|
|
|
|
|
Year ended 31 March
|
|
|
|
|
Re-presented1
|
|
|
|
2024
|
2023
|
|
|
|
€m
|
€m
|
Revenue
|
|
|
36,717
|
37,672
|
Cost of sales
|
|
|
(24,459)
|
(24,359)
|
Gross profit
|
|
|
12,258
|
13,313
|
Selling and distribution expenses
|
|
|
(2,674)
|
(2,777)
|
Administrative expenses
|
|
|
(5,768)
|
(5,351)
|
Net credit losses on financial assets
|
|
|
(491)
|
(505)
|
Share of results of equity accounted associates and joint
ventures
|
|
|
(96)
|
433
|
Impairment reversal/(loss)
|
|
|
64
|
(64)
|
Other income
|
|
|
372
|
9,402
|
Operating profit
|
|
|
3,665
|
14,451
|
Investment income
|
|
|
581
|
232
|
Financing costs
|
|
|
(2,626)
|
(1,609)
|
Profit before taxation
|
|
|
1,620
|
13,074
|
Income tax expense
|
|
|
(50)
|
(492)
|
Profit for the financial year - Continuing operations
|
|
|
1,570
|
12,582
|
Loss for the financial year - Discontinued operations
|
|
|
(65)
|
(247)
|
Profit for the financial year
|
|
|
1,505
|
12,335
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
- Owners of the parent
|
|
|
1,140
|
11,838
|
- Non-controlling interests
|
|
|
365
|
497
|
Profit for the financial year
|
|
|
1,505
|
12,335
|
|
|
|
|
|
Earnings per share
|
|
|
|
|
Continuing operations:
|
|
|
|
|
- Basic
|
|
|
4.45c
|
43.66c
|
- Diluted
|
|
|
4.44c
|
43.51c
|
Total Group:
|
|
|
|
|
- Basic
|
|
|
4.21c
|
42.77c
|
- Diluted
|
|
|
4.20c
|
42.62c
|
|
|
|
|
|
|
Note:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' for more
information.
The accompanying notes are an integral part of the condensed
consolidated financial statements.
Consolidated statement of comprehensive
income/(expense)
|
|
|
|
|
|
|
Year ended 31 March
|
|
|
|
|
|
|
Re-presented1
|
|
|
|
|
|
2024
|
2023
|
|
|
|
|
|
€m
|
€m
|
|
Profit for the financial year
|
|
|
|
1,505
|
12,335
|
|
Other comprehensive income/(expense):
|
|
|
|
|
|
|
Items that may be reclassified to the income statement in
subsequent years:
|
|
|
|
|
|
|
Foreign exchange translation differences, net of tax
|
|
|
|
(440)
|
(1,236)
|
|
Foreign exchange translation differences transferred to the income
statement
|
|
|
|
23
|
(334)
|
|
Other, net of tax2
|
|
|
|
(1,748)
|
963
|
|
Total items that may be reclassified to the income statement in
subsequent years
|
|
|
|
(2,165)
|
(607)
|
|
Items that will not be reclassified to the income statement in
subsequent years:
|
|
|
|
|
|
|
Net actuarial losses on defined benefit pension schemes, net of
tax
|
|
|
|
(58)
|
(160)
|
|
Total items that will not be reclassified to the income statement
in subsequent years
|
|
|
|
(58)
|
(160)
|
|
Other comprehensive expense
|
|
|
|
(2,223)
|
(767)
|
|
Total comprehensive (expense)/income for the financial
year
|
|
|
|
(718)
|
11,568
|
|
|
|
|
|
|
|
|
Attributable to:
|
|
|
|
|
|
|
- Owners of the parent
|
|
|
|
(920)
|
11,267
|
|
- Non-controlling interests
|
|
|
|
202
|
301
|
|
|
|
|
|
(718)
|
11,568
|
|
Notes:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' for more
information.
2.
Principally includes the impact of the Group's cash flow hedges
deferred to other comprehensive income during the
year.
The accompanying notes are an integral part of the condensed
consolidated financial statements.
Consolidated statement of financial position
|
|
|
|
|
|
|
|
31 March
|
31 March
|
|
|
|
2024
|
2023
|
|
|
|
€m
|
€m
|
Non-current assets
|
|
|
|
|
Goodwill
|
|
|
24,956
|
27,615
|
Other intangible assets
|
|
|
13,896
|
19,592
|
Property, plant and equipment
|
|
|
28,499
|
37,992
|
Investments in associates and joint ventures
|
|
|
10,032
|
11,079
|
Other investments
|
|
|
1,006
|
1,093
|
Deferred tax assets
|
|
|
20,177
|
19,316
|
Post employment benefits
|
|
|
257
|
329
|
Trade and other receivables
|
|
|
5,967
|
7,843
|
|
|
|
104,790
|
124,859
|
Current assets
|
|
|
|
|
Inventory
|
|
|
568
|
956
|
Taxation recoverable
|
|
|
76
|
279
|
Trade and other receivables
|
|
|
8,594
|
10,705
|
Other investments
|
|
|
5,092
|
7,017
|
Cash and cash equivalents
|
|
|
6,183
|
11,705
|
|
|
|
20,513
|
30,662
|
Assets held for sale
|
|
|
19,047
|
-
|
Total assets
|
|
|
144,350
|
155,521
|
|
|
|
|
|
Equity
|
|
|
|
|
Called up share capital
|
|
|
4,797
|
4,797
|
Additional paid-in capital
|
|
|
149,253
|
149,145
|
Treasury shares
|
|
|
(7,645)
|
(7,719)
|
Accumulated losses
|
|
|
(114,641)
|
(113,086)
|
Accumulated other comprehensive income
|
|
|
28,202
|
30,262
|
Total attributable to owners of the parent
|
|
|
59,966
|
63,399
|
Non-controlling interests
|
|
|
1,032
|
1,084
|
Total equity
|
|
|
60,998
|
64,483
|
|
|
|
|
|
Non-current liabilities
|
|
|
|
|
Borrowings
|
|
|
48,328
|
51,669
|
Deferred tax liabilities
|
|
|
699
|
771
|
Post employment benefits
|
|
|
181
|
258
|
Provisions
|
|
|
1,615
|
1,572
|
Trade and other payables
|
|
|
2,328
|
2,184
|
|
|
|
53,151
|
56,454
|
Current liabilities
|
|
|
|
|
Borrowings
|
|
|
8,659
|
14,721
|
Financial liabilities under put option arrangements
|
|
|
-
|
485
|
Taxation liabilities
|
|
|
393
|
457
|
Provisions
|
|
|
833
|
674
|
Trade and other payables
|
|
|
13,398
|
18,247
|
|
|
|
23,283
|
34,584
|
Liabilities held for sale
|
|
|
6,918
|
-
|
Total equity and liabilities
|
|
|
144,350
|
155,521
|
The accompanying notes are an integral part of the condensed
consolidated financial statements.
Consolidated statement of changes in equity
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
capital
|
Additional
paid-in
capital1
|
Treasury
shares
|
Accumulated
comprehensive
losses2
|
Equity attributable to the owners
|
Non-
controlling
interests
|
Total equity
|
|
€m
|
€m
|
€m
|
€m
|
€m
|
€m
|
€m
|
1 April 2022
|
4,797
|
149,018
|
(7,278)
|
(91,189)
|
55,348
|
2,290
|
57,638
|
Issue or reissue of shares
|
-
|
1
|
122
|
(113)
|
10
|
-
|
10
|
Share-based payments
|
-
|
126
|
-
|
-
|
126
|
9
|
135
|
Transactions with non-controlling interests in
subsidiaries
|
-
|
-
|
-
|
(287)
|
(287)
|
(1,118)
|
(1,405)
|
Comprehensive income
|
-
|
-
|
-
|
11,267
|
11,267
|
301
|
11,568
|
Dividends
|
-
|
-
|
-
|
(2,502)
|
(2,502)
|
(398)
|
(2,900)
|
Purchase of treasury shares
|
-
|
-
|
(563)
|
-
|
(563)
|
-
|
(563)
|
31 March 2023
|
4,797
|
149,145
|
(7,719)
|
(82,824)
|
63,399
|
1,084
|
64,483
|
|
|
|
|
|
|
|
|
1 April 2023
|
4,797
|
149,145
|
(7,719)
|
(82,824)
|
63,399
|
1,084
|
64,483
|
Issue or reissue of shares
|
-
|
-
|
74
|
(72)
|
2
|
-
|
2
|
Share-based payments
|
-
|
108
|
-
|
-
|
108
|
7
|
115
|
Transactions with non-controlling interests in
subsidiaries
|
-
|
-
|
-
|
(26)
|
(26)
|
(5)
|
(31)
|
Share of equity accounted entities changes in equity
|
-
|
-
|
-
|
(164)
|
(164)
|
-
|
(164)
|
Comprehensive (expense)/income
|
-
|
-
|
-
|
(920)
|
(920)
|
202
|
(718)
|
Dividends
|
-
|
-
|
-
|
(2,433)
|
(2,433)
|
(256)
|
(2,689)
|
31 March 2024
|
4,797
|
149,253
|
(7,645)
|
(86,439)
|
59,966
|
1,032
|
60,998
|
Notes:
1. Includes
share premium, capital reserve, capital redemption reserve, merger
reserve and share-based payment reserve. The merger reserve was
derived from acquisitions made prior to 31 March 2004 and
subsequently allocated to additional paid-in capital on adoption of
IFRS.
2.
Includes accumulated losses and accumulated other comprehensive
income.
The accompanying notes are an integral part of the condensed
consolidated financial statements.
Consolidated statement of cash flows
|
|
|
|
|
|
|
|
Year ended 31 March
|
|
|
|
|
Re-presented1
|
|
|
|
2024
|
2023
|
|
|
|
€m
|
€m
|
Inflow from operating activities
|
|
|
16,557
|
18,054
|
|
|
|
|
|
Cash flows from investing activities
|
|
|
|
|
Purchase of interests in associates and joint ventures
|
|
|
(75)
|
(78)
|
Purchase of intangible assets
|
|
|
(2,641)
|
(2,799)
|
Purchase of property, plant and equipment
|
|
|
(4,219)
|
(4,957)
|
Purchase of investments
|
|
|
(1,233)
|
(766)
|
Disposal of interests in subsidiaries, net of cash
disposed
|
|
|
(67)
|
6,976
|
Disposal of interests in associates and joint ventures
|
|
|
500
|
-
|
Disposal of property, plant and equipment and intangible
assets
|
|
|
15
|
90
|
Disposal of investments
|
|
|
1,931
|
1,647
|
Dividends received from associates and joint ventures
|
|
|
442
|
617
|
Interest received
|
|
|
542
|
321
|
Cash outflows from discontinued operations
|
|
|
(1,317)
|
(1,430)
|
Outflow from investing activities
|
|
|
(6,122)
|
(379)
|
|
|
|
|
|
Cash flows from financing activities
|
|
|
|
|
Proceeds from issue of long-term borrowings
|
|
|
1,533
|
4,071
|
Repayment of borrowings
|
|
|
(8,970)
|
(10,501)
|
Net movement in short-term borrowings
|
|
|
(1,636)
|
3,171
|
Net movement in derivatives
|
|
|
144
|
261
|
Interest paid2
|
|
|
(2,227)
|
(1,815)
|
Payments for settlement of written put options
|
|
|
(493)
|
(12)
|
Purchase of treasury shares
|
|
|
-
|
(1,867)
|
Issue of ordinary share capital and reissue of treasury
shares
|
|
|
3
|
10
|
Equity dividends paid
|
|
|
(2,430)
|
(2,484)
|
Dividends paid to non-controlling shareholders in
subsidiaries
|
|
|
(260)
|
(400)
|
Other transactions with non-controlling shareholders in
subsidiaries
|
|
|
(16)
|
(692)
|
Cash outflows from discontinued operations
|
|
|
(1,503)
|
(3,172)
|
Outflow from financing activities
|
|
|
(15,855)
|
(13,430)
|
|
|
|
|
|
Net cash (outflow)/inflow
|
|
|
(5,420)
|
4,245
|
Cash and cash equivalents at beginning of the financial
year3
|
|
|
11,628
|
7,371
|
Exchange (loss)/gain on cash and cash equivalents
|
|
|
(94)
|
12
|
Cash and cash equivalents at end of the financial
year3
|
|
|
6,114
|
11,628
|
Notes:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' for more
information.
2.
Interest paid includes €nil (FY23: €26 million cash
outflow) on derivative financial instruments for the share buyback
related to maturing tranches of mandatory convertible
bonds.
3.
Comprises cash and cash equivalents as presented in the
consolidated statement of financial position of €6,183million
(FY23: €11,705 million), together with overdrafts of
€111 million (FY23: €77 million) and €42 million
(FY23: €nil) of cash and cash equivalents included within
Assets held for sale.
The accompanying notes are an integral part of the condensed
consolidated financial statements.
Notes to the condensed consolidated financial
statements
1 Basis of preparation
The preliminary results for the year ended 31 March 2024 are an
abridged statement of the full Annual Report which was approved by
the Board of Directors on 14 May 2024. The consolidated financial
statements in the full Annual Report are prepared in accordance
with UK-adopted International Financial Reporting Standards
('IFRS'), with IFRS as issued by the International Accounting
Standards Board ('IASB') and with the requirements of the Companies
Act 2006.
The auditor's report on those consolidated financial statements was
unqualified, did not draw attention to any matters by way of
emphasis without qualifying their report and did not contain
statements under section 498(2) or 498(3) of the Companies Act
2006. The preliminary results do not comprise statutory accounts
within the meaning of section 434(3) of the Companies Act 2006. The
Annual Report for the year ended 31 March 2024 will be delivered to
the Registrar of Companies following the Company's Annual General
Meeting on 30 July 2024.
The financial information included in this preliminary announcement
does not itself contain sufficient information to comply with IFRS.
A separate announcement will be made in accordance with Disclosure
and Transparency Rules (DTR) 6.3 when the Annual Report for the
year ended 31 March 2024 is made available on the Company's website
in June 2024.
The preparation of the preliminary results requires management to
make estimates and assumptions that affect the reported amounts of
assets and liabilities, disclosure of contingent assets and
liabilities at the end of the reporting period and the reported
amounts of revenue and expenses during the reporting period. Actual
results could vary from these estimates. The estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period or in
the period of the revision and future periods if the revision
affects both current and future periods.
Going concern
The Group has €6.1 billion of cash and cash equivalents
available as at 31 March 2024 which, together with undrawn
revolving credit facilities of €7.8 billion, cover all of the
Group's reasonably expected cash requirements over the going
concern period. The Directors have reviewed trading and liquidity
forecasts for the Group, which were based on current trading
conditions, and considered a variety of scenarios. In addition to
the liquidity forecasts prepared, the Directors considered the
availability of the Group's revolving credit facilities which were
undrawn as at 31 March 2024. As a result of the assessment
performed, the Directors have concluded that the Group is able to
continue in operation for a period of at least 12 months from the
date of approving the consolidated financial statements and that it
is appropriate to continue to adopt the going concern basis in
preparing the consolidated financial statements.
Critical accounting judgements and estimates
The Group's critical accounting judgements and estimates are
disclosed in the Group's Annual Report for the year ended 31 March
2024.
New accounting pronouncements adopted
On 1 April 2023, the Group adopted certain new accounting policies
where necessary to comply with amendments to IFRS, none of which
had a material impact on the consolidated results, financial
position or cash flows of the Group. Further details are provided
in the Group's Annual Report for the prior year ended 31 March
2023.
Notes to the condensed consolidated financial
statements
1 Basis of preparation (continued)
Hyperinflation accounting
The Group continues to apply hyperinflationary accounting, as
specified in IAS 29, at its Turkish operations whose functional
currency is the Turkish lira and to Safaricom's operations in
Ethiopia where the Ethiopian birr is the functional
currency.
Turkish lira and Ethiopian birr results and non-monetary asset and
liability balances for the year ended 31 March 2024 have been
revalued to their present value equivalent local currency amounts
as at 31 March 2024, based on an inflation index, before
translation to euros at the reporting date exchange rate of
€1:34.94 TRL and €1:61.43 ETB,
respectively.
For the Group's operations in Turkey, the gain or loss on net
monetary assets resulting from IAS 29 application is recognised in
the consolidated income statement within Other
income.
For Safaricom's operations in Ethiopia, the impacts of IAS 29
accounting are reflected as an adjustment to Investments in
associates and joint ventures and to Profit attributable to the
joint ventures and associates.
The inflation index in Turkey selected to reflect the change in
purchasing power was the consumer price index ('CPI') issued by the
Turkish Statistical Institute which has risen by 68.50% during the
year ended 31 March 2024. The inflation index selected in Ethiopia
is the CPI issued by the Central Statistics Agency of Ethiopia
which rose 26.20% during the year ended 31 March
2024.
The main impacts of these adjustments on the consolidated financial
statements are shown
below.
|
Increase/(decrease)
|
|
2024
|
2023
|
Impact on the consolidated income statement for the years ended 31
March
|
€m
|
€m
|
Revenue
|
111
|
85
|
Operating profit
|
66
|
(87)
|
Profit for the financial year
|
(169)
|
(123)
|
|
|
|
|
Increase/(decrease)
|
|
31 March 2024
|
31 March 2023
|
Impact on the consolidated statement of financial position at 31
March
|
€m
|
€m
|
Net assets
|
981
|
814
|
Equity attributable to owners of the parent
|
913
|
777
|
Non-controlling interests
|
68
|
37
|
2 Dividends
|
2024
|
2023
|
|
€m
|
€m
|
Declared and paid during the financial year:
|
|
|
Final dividend for the year ended 31 March 2023: 4.50 eurocents per
share
|
1,215
|
1,265
|
(2022: 4.50 eurocents per share)
|
|
|
Interim dividend for the year ended 31 March 2024: 4.50 eurocents
per share
|
1,218
|
1,237
|
(2023: 4.50 eurocents per share)
|
|
|
|
2,433
|
2,502
|
|
|
|
Proposed after the end of the year and not recognised as a
liability:
|
|
|
Final dividend for the year ended 31 March 2024: 4.50 eurocents per
share
|
1,219
|
1,215
|
(2023: 4.50 eurocents per share)
|
|
|
Notes to the condensed consolidated financial
statements
3 Discontinued operations and assets held for
sale
Discontinued operations
Where
operations constitute a separately reportable segment and have been
disposed of, or are classified as held for sale, the Group
classifies such operations as discontinued.
Discontinued operations are excluded from the results of continuing
operations and are presented as a single amount as profit or loss
after tax from discontinued operations in the Consolidated income
statement. Discontinued operations are also excluded from segment
reporting. All other notes to the Condensed consolidated financial
statements include amounts for continuing operations, unless
indicated otherwise.
Transactions between the Group's continuing and discontinued
operations are eliminated in full in the Consolidated income
statement. To the extent that the Group considers that the
commercial relationships with discontinued operations will continue
post-disposal, transactions are reflected within continuing
operations with an opposite charge or credit reflected within the
results of discontinued operations resulting in a net nil impact on
the Group's Profit for the financial year for the years
presented.
On 31 October 2023, the Group announced that it had entered into
binding agreements with Zegona Communications plc ('Zegona') in
relation to the sale of 100% of Vodafone Holdings Europe, S.L.U.
('Vodafone Spain'). The expected completion of the disposal is the
first half of 2024.
On 15 March 2024, the Group announced that it had entered into a
binding agreement with Swisscom AG ('Swisscom') in relation to the
sale of 100% of Vodafone Italia S.p.A. ('Vodafone Italy'). The
expected completion of the disposal is in the first half of
2025.
Consequently, the results of Vodafone Spain and Vodafone Italy are
reported as discontinued operations and the assets and liabilities
of both are presented as held for sale in the consolidated
statement of financial position.
A summary of the results of these discontinued operations is
below.
|
|
|
Year ended 31 March
|
|
|
|
2024
|
2023
|
|
|
|
€m
|
€m
|
(Loss)/profit for the financial year - Discontinued
operations
|
|
|
|
|
Vodafone Spain
|
|
|
(5)
|
(340)
|
Vodafone Italy
|
|
|
(60)
|
93
|
Total
|
|
|
(65)
|
(247)
|
|
|
|
|
|
Loss per share - Discontinued operations
|
|
|
|
|
- Basic
|
|
|
(0.24)c
|
(0.89)c
|
- Diluted
|
|
|
(0.24)c
|
(0.89)c
|
Notes to the condensed consolidated financial
statements
3 Discontinued operations and assets held for
sale (continued)
Segment analysis of discontinued operations
Vodafone Spain
The results of discontinued operations in Spain are detailed
below.
|
|
|
Year ended 31 March
|
|
|
|
2024
|
2023
|
|
|
|
€m
|
€m
|
Revenue
|
|
|
3,773
|
3,675
|
Cost of sales
|
|
|
(2,593)
|
(2,959)
|
Gross profit
|
|
|
1,180
|
716
|
Selling and distribution expenses
|
|
|
(259)
|
(314)
|
Administrative expenses
|
|
|
(435)
|
(575)
|
Net credit losses on financial assets
|
|
|
(120)
|
(35)
|
Other expense
|
|
|
-
|
(122)
|
Operating profit/(loss)
|
|
|
366
|
(330)
|
Investment income
|
|
|
29
|
16
|
Financing costs
|
|
|
(56)
|
(26)
|
Profit/(loss) before taxation
|
|
|
339
|
(340)
|
Income tax credit
|
|
|
1
|
-
|
Profit/(loss) after tax of discontinued operations
|
|
|
340
|
(340)
|
|
|
|
|
|
After tax loss on the re-measurement of disposal group
|
|
|
(345)
|
-
|
|
|
|
|
|
Loss for the financial year from discontinued
operations
|
|
|
(5)
|
(340)
|
|
|
|
|
|
Total comprehensive expense for the financial year from
discontinued operations
|
|
|
|
|
Attributable to owners of the parent
|
|
|
(5)
|
(340)
|
The consideration for Vodafone Spain is comprised of €4.1
billion cash to be paid on completion and non-cash consideration
with a nominal value of €0.9 billion. The non-cash
consideration comprises Redeemable Preference Shares ('RPS') which
will be issued to Vodafone by a newly created entity, which will
subscribe for new ordinary shares in Zegona for an amount, based on
the issue price for Zegona's equity raise, that is equivalent to
the amount of RPS being subscribed for by Vodafone. The RPS will be
redeemed 6 years after completion, or earlier following a material
liquidity event or exit for Zegona that releases funds to its
shareholders. A proportion of the consideration is related to
future services to be provided by the Group to
Zegona. For
the year ended 31 March 2024, the Group recorded a non-cash charge
of €345 million (pre and post-tax), included in discontinued
operations, as a result of the re-measurement of Vodafone Spain to
its fair value less costs to sell. The charge mostly results
from the non-recognition of €538 million (pre and post-tax)
depreciation and amortisation of non-current assets from the date
Vodafone Spain was classified as held for sale.
The
fair value of the Group's equity interest at 31 March 2024 was
determined with reference to the consideration expected from the
agreed sale to Zegona less adjustments for estimated completion
adjustments, consideration for future services to be received by
Zegona from the Group and the elimination of intercompany debt.
This approach was considered to result in a level 2 valuation in
accordance with IFRS 13 as certain estimated completion adjustments
and the fair value of the non-cash consideration, are not
observable.
Notes to the condensed consolidated financial
statements
Vodafone Italy
The
results of discontinued operations in Italy are detailed
below.
|
|
|
Year ended 31 March
|
|
|
|
2024
|
2023
|
|
|
|
€m
|
€m
|
Revenue
|
|
|
4,579
|
4,722
|
Cost of sales
|
|
|
(3,438)
|
(3,532)
|
Gross profit
|
|
|
1,141
|
1,190
|
Selling and distribution expenses
|
|
|
(244)
|
(238)
|
Administrative expenses
|
|
|
(760)
|
(710)
|
Net credit losses on financial assets
|
|
|
(51)
|
(66)
|
Other expense
|
|
|
-
|
(1)
|
Operating profit
|
|
|
86
|
175
|
Investment income
|
|
|
-
|
-
|
Financing costs
|
|
|
(86)
|
(93)
|
Profit before taxation
|
|
|
-
|
82
|
Income tax credit
|
|
|
23
|
11
|
Profit after tax of discontinued operations
|
|
|
23
|
93
|
|
|
|
|
|
After tax loss on the re-measurement of disposal group
|
|
|
(83)
|
-
|
|
|
|
|
|
(Loss)/profit for the financial year from discontinued
operations
|
|
|
(60)
|
93
|
|
|
|
|
|
Total comprehensive (expense)/income for the financial year from
discontinued operations
|
|
|
|
|
Attributable to owners of the parent
|
|
|
(71)
|
80
|
The consideration for Vodafone Italy is comprised of €8
billion cash to be paid on completion. A proportion of the
consideration is related to future services to be provided by the
Group to Swisscom. For
the year ended 31 March 2024, the Group recorded a non-cash charge
of €83 million (pre and post-tax), included in discontinued
operations, as a result of the re-measurement of Vodafone Italy to
its fair value less costs to sell. The charge mostly results
from the non-recognition of €93 million (€67 million
net of tax) depreciation and amortisation of non-current assets
from the date Vodafone Italy was classified as held for
sale.
The
fair value of the Group's equity interest at 31 March 2024 was
determined with reference to the consideration expected to be
received from the agreed sale to Swisscom, less adjustments for
estimated completion adjustments, consideration for future services
to be received by Swisscom from the Group and the elimination of
intercompany debt. This approach was considered to result in
a level 2 valuation in accordance with IFRS 13 as, certain
completion related adjustments and estimates of the value of the
future services to be provided, are not observable.
Notes to the condensed consolidated financial
statements
3 Discontinued operations and assets held for
sale (continued)
Assets held for sale
Assets
and liabilities relating to Vodafone Spain and Vodafone Italy have
been classified as held for sale in the consolidated statement of
financial position at 31 March 2024. The relevant assets and
liabilities are detailed in the table below.
|
Vodafone Spain
|
Vodafone Italy
|
Total
|
|
€m
|
€m
|
€m
|
Non-current assets
|
|
|
|
Goodwill
|
-
|
2,398
|
2,398
|
Other intangible assets
|
987
|
3,331
|
4,318
|
Property, plant and equipment
|
4,957
|
4,307
|
9,264
|
Other investments
|
2
|
-
|
2
|
Deferred tax assets
|
-
|
461
|
461
|
Trade and other receivables
|
223
|
167
|
390
|
|
6,169
|
10,664
|
16,833
|
Current assets
|
|
|
|
Inventory
|
39
|
134
|
173
|
Taxation recoverable
|
-
|
77
|
77
|
Trade and other receivables
|
805
|
1,117
|
1,922
|
Cash and cash equivalents
|
13
|
29
|
42
|
|
857
|
1,357
|
2,214
|
|
|
|
|
Assets held for sale
|
7,026
|
12,021
|
19,047
|
|
|
|
|
Non-current liabilities
|
|
|
|
Borrowings
|
878
|
1,509
|
2,387
|
Deferred tax liabilities
|
3
|
-
|
3
|
Post employment benefits
|
-
|
45
|
45
|
Provisions
|
158
|
115
|
273
|
Trade and other payables
|
43
|
120
|
163
|
|
1,082
|
1,789
|
2,871
|
Current liabilities
|
|
|
|
Borrowings
|
346
|
673
|
1,019
|
Taxation liabilities
|
-
|
12
|
12
|
Provisions
|
23
|
67
|
90
|
Trade and other payables
|
1,203
|
1,723
|
2,926
|
|
1,572
|
2,475
|
4,047
|
|
|
|
|
Liabilities held for sale
|
2,654
|
4,264
|
6,918
|
Notes to the condensed consolidated financial
statements
4 Contingent liabilities and legal
proceedings
Vodafone Idea
As
part of the agreement to merge Vodafone India and Idea Cellular in
2017, the parties agreed a mechanism for payments between the Group
and Vodafone Idea Limited ('VIL') pursuant to the difference
between the crystallisation of certain identified contingent
liabilities in relation to legal, regulatory, tax and other
matters, and refunds relating to Vodafone India and Idea Cellular.
Cash payments or cash receipts relating to these matters must have
been made or received by VIL before any amount becomes due from or
owed to the Group. Any future payments by the Group to VIL as a
result of this agreement would only be made after satisfaction of
this and other contractual conditions. The Group's
maximum potential exposure under this mechanism is capped at INR 64
billion (€713 million).
The final liability calculation date under the CLAM is 30 June 2025
and no further cash payments are considered probable from the Group
as at 31 March 2024.
The carrying value of the Group's investment in VIL is €nil
and the Group is recording no further share of losses in respect of
VIL. The Group's potential exposure to liabilities within VIL is
capped by the mechanism described above; consequently, contingent
liabilities arising from litigation in India concerning the
operations of Vodafone India are not reported.
Indus Towers
Under
the terms of the Indus and Bharti Infratel merger in November 2020,
a security package was agreed for the benefit of the newly created
merged entity, Indus Towers, which could be invoked in the event
that VIL was unable to make MSA payments. The remaining element of
the security package is a secondary pledge over shares owned by
Vodafone Group in Indus Towers, ranking behind Vodafone's existing
lenders for the outstanding bank borrowings of €1.7 billion
as at 31 March 2024 secured against Indian assets ('the bank
borrowings'), with a maximum liability cap of INR 42.5 billion
(€472 million). In the event of non-payment of relevant
MSA obligations by VIL, Indus Towers would have recourse to any
secondary pledged shares, after repayment of the bank borrowings in
full, up to the value of the liability cap.
Legal proceedings
The
Group is currently involved in a number of legal proceedings,
including inquiries from, or discussions with, government
authorities that are incidental to its operations.
Legal proceedings where the Group considers that the likelihood of
material future outflows of cash or other resources is more than
remote are disclosed below. Where the Group assesses that it is
probable that the outcome of legal proceedings will result in a
financial outflow, and a reliable estimate can be made of the
amount of that obligation, a provision is recognised for these
amounts.
In all cases, determining the probability of successfully defending
a claim against the Group involves the application of judgement as
the outcome is inherently uncertain. The determination of the value
of any future outflows of cash or other resources, and the timing
of such outflows, involves the use of estimates. The costs incurred
in complex legal proceedings, regardless of outcome, can be
significant.
The Group is not involved in any material proceedings in which any
of the Group's Directors, members of senior management or
affiliates are either a party adverse to the Group or have a
material interest adverse to the Group.
Notes to the condensed consolidated financial
statements
4 Contingent liabilities and legal proceedings
(continued)
Tax cases
VISPL tax claims
Vodafone India Services Private Limited ('VISPL') is involved in a
number of tax cases. The total value of the claims is approximately
€468 million plus interest, and penalties of up to 300% of
the principal.
Of the individual tax claims, the most significant is for
approximately €238 million (plus interest of €672
million), which VISPL has been assessed as owing in respect of: (i)
the sale of an international call centre by VISPL to Hutchison
Telecommunications International Limited group ('HTIL'); and (ii)
the acquisition of and/or the alleged transfer of options held by
VISPL in Vodafone India Limited. Item (i) is subject to an
indemnity by HTIL. Item (ii), which forms the largest part of the
potential claim, is not subject to any indemnity. A stay of the tax
demand was obtained following a deposit of INR 2,000 million
(€22 million) being paid, and a corporate guarantee being
provided by Vodafone International Holdings BV ('VIHBV') for the
balance of tax assessed. On 8 October 2015, the Bombay High Court
ruled in favour of Vodafone in relation to the options and the call
centre sale. The Indian Tax Authority has appealed to the Supreme
Court of India. The appeal hearing has been adjourned indefinitely.
A claim in respect of the transfer pricing margin charged for the
international call centre of HTIL prior to the 2007 transaction
with Vodafone for HTIL assets in India has now been
settled.
While there is some uncertainty as to the outcome of the remaining
tax cases involving VISPL, the Group believes it has valid defences
and does not consider it probable that a financial outflow will be
required to settle these cases.
Netherlands tax case
Vodafone Europe BV ('VEBV') received assessments totalling
€267 million of tax and interest from the Dutch tax
authorities, who challenged the application of the arm's length
principle in relation to various intra-group financing
transactions. The Group entered into a guarantee for the full value
of the assessments issued. VEBV appealed against these assessments
to the District Court of the Hague where a hearing was held in
March 2023. The District Court issued its judgement in July 2023,
upholding VEBV's appeal in relation to the majority of issues and
requiring the Dutch tax authorities to significantly reduce its
assessments. VEBV and the Dutch tax authorities have since appealed
the judgement. The appeal hearing date is not yet known but is
expected to be before the end of 2024.
The Group continues to believe it has robust defences but has
recorded a provision of €24 million for tax and interest,
reflecting the Group's current view of the probable financial
outflow required to fully resolve the issue and has reduced the
guarantee to the same value.
Other cases in the Group
Germany: Kabel Deutschland takeover - class actions
The German courts have been determining the adequacy of the
mandatory cash offer made to minority shareholders in Vodafone's
takeover of Kabel Deutschland in 2013. Hearings took place in May
2019 and a decision was delivered in November 2019 in Vodafone's
favour, rejecting all claims by minority shareholders. A number of
shareholders appealed which was rejected by the court in December
2021. Several minority shareholders filed a further appeal before
the Federal Court of Justice which was dismissed in April
2024.
Germany: price increase class action
In November 2023, the Verbraucherzentrale Bundesverband (Federation
of German Consumer Organisations) initiated a class action against
Vodafone Germany in the Hamm Higher Regional Court. Vodafone
Germany implemented price increases of €5 per month for fixed
lines services in 2023 in response to higher costs. The claim
alleges that terms regarding price increases in the consumer
contracts entered into by Vodafone Germany's customers up until
August 2023 are invalid under German civil law and seeks
reimbursement of the additional charges plus interest. Customers
must enter their details onto the register of collective actions on
the Federal Office of Justice website in order to participate in
the claim. The register opened on 23 April 2024.
Whilst the Group intends to defend the claim, it is not able to
determine the likelihood or estimate the amount of any possible
financial loss at this early stage of the proceedings.
Notes to the condensed consolidated financial
statements
4 Contingent liabilities and legal proceedings
(continued)
Germany: claims regarding transfer of data to credit
agencies
Individual consumers are bringing claims against Vodafone Germany
and/or the other national network operators alleging that
information was passed to credit agencies up to February 2024 about
contracts for mobile services without consumer consent. The claims
seek damages of up to €5,000 per contract for GDPR (General
Data Protection Regulation) infringement. As at 31 March 2024,
Vodafone Germany had been notified of 316 claims filed in various
regional courts. The other national network operators are facing
similar claims.
The Group's position is that the transfer of data about the
existence of a consumer contract (and not about payments in
relation to the contract) to credit agencies is standard practice
and justified for the purposes of fraud prevention. However, given
the increasing volume of claims, Vodafone Germany has stopped this
activity.
Although the outcome of these claims is uncertain and consequently
it is not possible to estimate a potential financial loss, if any,
at this stage, the Group believes it has valid defences and that no
present obligation exists based on all available
evidence.
Germany: investigation by federal data protection
authority
In 2021, the BfDI (Federal Commissioner for Data Protection and
Freedom of Information) started an investigation into potential
breaches of the GDPR in relation to the systems used by Vodafone
Germany's sales partners to manage customer data.
Vodafone Germany is working cooperatively with the authority to
discuss the circumstances giving rise to these issues and is
currently conducting settlement talks with the aim of reaching a
constructive resolution of the proceedings. Under the GDPR the
authority has the power to impose fines of up to 2% of the Group's
annual revenue from the preceding financial year.
A provision immaterial to the financial statements has been
recorded.
Italy: Iliad v Vodafone Italy
In July 2019, Iliad filed a claim for €500 million against
Vodafone Italy in the Civil Court of Milan. The claim alleges
anti-competitive behaviour in relation to customer portability and
certain advertising campaigns by Vodafone Italy. The main hearing
on the merits of the claim took place on 8 June 2021. On 17 April
2023, the Civil Court issued a judgement in Vodafone Italy's favour
and rejected Iliad's claim for damages in full. Iliad filed an
appeal before the Court of Appeal of Milan in June 2023. The appeal
process is ongoing.
The Group is currently unable to estimate any possible loss in this
claim in the event of an adverse judgement on appeal but, while the
outcome is uncertain, the Group believes it has valid defences and
that it is probable that no present obligation exists.
Greece: Papistas Holdings SA, Mobile Trade Stores (formerly
Papistas SA) and Athanasios and Loukia Papistas v Vodafone
Greece
In October 2019, Mr. and Mrs. Papistas, and companies owned or
controlled by them, filed several claims against Vodafone Greece
with a total value of approximately €330 million for
purported damage caused by the alleged abuse of dominance and
wrongful termination of a franchise arrangement with a Papistas
company. Lawsuits which the Papistas claimants had previously
brought against Vodafone Greece, including one also citing Vodafone
Group Plc and certain Directors and officers of Vodafone as
defendants, were either withdrawn or left dormant. Vodafone Greece
filed a counter claim and all claims were heard in February 2020.
All of the Papistas claims were rejected by the Athens Court of
First Instance because the stamp duty payments required to have the
merits of the case considered had not been made. Vodafone
Greece's counter claim was also rejected. The Papistas claimants
and Vodafone Greece each filed appeals. The appeal hearings took
place on 23 February and 11 May 2023. Judgement has been received
and the Court dismissed both of the appeals because the stamp duty
payments had again not been made, except for one aspect of the
proceedings which will be dealt with at a further hearing in
February 2025. Whether the Papistas claimants will appeal the
judgement is unknown as at the date of this report.
Vodafone is continuing vigorously to defend the claims and based on
the progress of the litigation so far the Group believes that it is
highly unlikely that there will be an adverse ruling for the Group.
On this basis, the Group does not expect the outcome of these
claims to have a material financial impact.
Notes to the condensed consolidated financial
statements
4 Contingent liabilities and legal proceedings
(continued)
UK: Phones 4U in Administration v Vodafone Limited, Vodafone Group
Plc and Others
In December 2018, the administrators of former UK indirect seller,
Phones 4U, sued the three main UK mobile network operators
('MNOs'), including Vodafone, and their parent companies in the
English High Court. The administrators alleged collusion between
the MNOs to withdraw their business from Phones 4U thereby causing
its collapse. The judge ordered that there should be a split trial
between liability and damages. The first trial on liability took
place from May to July 2022. On 10 November 2023, the High Court
issued a judgement in Vodafone's favour and rejected Phones 4U's
allegations that the defendants were in breach of competition law,
consistent with Vodafone's previously stated position that a
present obligation does not exist. Phones 4U has been granted
permission to appeal the judgement from the Court of Appeal. The
appeal hearing will take place in May 2025.
The Group intends to vigorously defend the appeal and is not able
to estimate any possible loss in the event of an adverse judgement
on appeal.
South Africa: Kenneth Makate v Vodacom
(Pty) Limited
Mr Kenneth Makate, a former employee of Vodacom Pty Limited
('Vodacom South Africa'), started legal proceedings in 2008
claiming compensation for a business idea that led to the
development of a service known as 'Please Call Me' ('PCM'). In July
2014, the Gauteng High Court ('the High Court') ruled that Mr
Makate had proven the existence of a contract, but that Vodacom
South Africa was not bound by that contract because the responsible
director did not have authority to enter into such an agreement on
Vodacom South Africa's behalf. The High Court and Supreme Court of
Appeal ('the SCA') turned down Mr Makate's application for leave to
appeal in December 2014 and March 2015, respectively.
In April 2016, the Constitutional Court of South Africa ('the
Constitutional Court') granted leave to appeal and upheld Mr
Makate's appeal. It found that Vodacom South Africa is bound by an
agreement and ordered the parties to negotiate, in good faith, and
agree a reasonable compensation amount payable to Mr Makate or, in
the event of a deadlock, for the matter to be referred to Vodacom
Group's Chief Executive Officer ('the CEO') for determination. Mr
Makate's application for the aforementioned order to be varied from
the determination of an amount to a compensation model based on a
share of revenue, was dismissed by the Constitutional Court. In
accordance with the Constitutional Court order, and after
negotiations failed, the CEO issued his determination on 9 January
2019. However, the CEO's award of R47 million (€2 million)
was rejected by Mr Makate, who subsequently brought an application
in the High Court for judicial review against the CEO's
determination and award.
The High Court, in a judgement delivered on 8 February 2022, set
aside the CEO's determination and ordered him to reassess the
amount employing a set of criteria which would have resulted in the
payment of a higher compensation amount, for the benefit of Mr
Makate, than that determined by the CEO. Vodacom South Africa
appealed against the judgement and the order of the High Court to
the SCA. The SCA heard the appeal on 9 May 2023 and its judgement
was handed down on 6 February 2024. A majority of three
judges, with a minority of two judges dissenting, dismissed
the appeal and ruled that Mr Makate is entitled to be paid 5% -
7.5% of the total revenue of the PCM product from March 2001 to the
date of the judgement, plus interest.
On 27 February 2024, Vodacom South Africa applied for leave to
appeal the judgement and order of the SCA to the Constitutional
Court, resulting in the suspension of the operation of the
judgement and order of the SCA. Mr Makate is opposing Vodacom South
Africa's application for leave to appeal. Vodacom South Africa is
challenging the SCA's judgement and order on various grounds
including, but not limited to the SCA ignoring the evidence placed
before it on the computation of the quantum of compensation payable
to Mr Makate, and the SCA issuing orders that are legally
unenforceable.
The CEO's determination in 2019 amounted to R47 million (€2
million). The minority judgement of the SCA raised Mr Makate's
compensation to approximately R186 million (€9 million),
while the SCA majority judgement would entitle Mr Makate to a
minimum compensation amount of R29 billion
(€1.4 billion). Consequently, the range of the possible
compensation outcomes in this matter is very wide.
The amount ultimately payable to Mr Makate is uncertain and will
depend on the determination of the Constitutional Court to grant
Vodacom South Africa's application for leave to appeal and, if
granted, on the success of Vodacom South Africa's appeal against
the judgement and order of the SCA, on the merits of the case. The
Group is continuing to challenge the level of compensation payable
to Mr Makate and a provision immaterial to the financial statements
has been recorded.
Notes to the condensed consolidated financial
statements
4 Contingent liabilities and legal proceedings
(continued)
UK: Mr Justin Gutmann v Vodafone
Limited and Vodafone Group Plc
In November 2023, Mr Gutmann issued claims in the Competition
Appeal Tribunal seeking permission, as a proposed class
representative, to bring collective proceedings against the four UK
MNOs and their respective parent companies. Vodafone Group Plc and
Vodafone Limited are named defendants to one of the claims with an
alleged value of £1.4 billion (approximately €1.6
billion), including interest. It is alleged that Vodafone and the
other MNOs used their alleged market dominance to overcharge
customers after the expiry of the minimum terms of certain mobile
contracts (referred to as a 'loyalty penalty').
Taking into account all available evidence at this stage, the
Group's assessment is that the allegations are without merit and it
intends to defend the claim. The Group is currently unable to
estimate any possible loss in regards to this issue but, while the
outcome is uncertain, the Group believes it is probable that no
present obligation exists.
In the discussion of the Group's reported operating results,
non-GAAP measures are presented to provide readers with additional
financial information that is regularly reviewed by management.
This additional information presented is not uniformly defined by
all companies including those in the Group's industry. Accordingly,
it may not be comparable with similarly titled measures and
disclosures by other companies. Additionally, certain information
presented is derived from amounts calculated in accordance with
IFRS but is not itself a measure defined under GAAP. Such measures
should not be viewed in isolation or as an alternative to the
equivalent GAAP measure. The non-GAAP measures discussed in this
document are listed below.
Non-GAAP measure
|
Defined on page
|
Closest equivalent GAAP measure
|
Reconciled on page
|
Performance metrics
|
|
|
|
Adjusted
EBITDAaL
|
Page
37
|
Operating
profit
|
Page
3
|
Organic
Adjusted EBITDAaL growth
|
Page
37
|
Not
applicable
|
-
|
Organic
revenue growth
|
Page
37
|
Revenue
|
Pages
38 to 41
|
Organic
Group service revenue growth excluding Turkey
|
Page
37
|
Service
revenue
|
Pages
38 to 41
|
Organic
Group Adjusted EBITDAaL growth excluding Turkey
|
Page
37
|
Not
applicable
|
-
|
Organic
service revenue growth
|
Page
37
|
Service
revenue
|
Pages
38 to 41
|
Organic
mobile service revenue growth
|
Page
37
|
Service
revenue
|
Pages
38 to 41
|
Organic
fixed service revenue growth
|
Page
37
|
Service
revenue
|
Pages
38 to 41
|
Organic
Vodafone Business (B2B) service revenue growth (Group and Operating
segments)
|
Page
37
|
Service
revenue
|
Pages
38 to 41
|
Organic
financial services revenue growth in South Africa
|
Page
37
|
Service
revenue
|
Pages
38 to 41
|
Other metrics
|
|
|
|
Adjusted
profit attributable to owners of the parent
|
Page
42
|
Profit
attributable to owners of the parent
|
Page
42
|
Adjusted
basic earnings per share
|
Page
42
|
Basic
earnings per share
|
Page
43
|
Cash flow, funding and capital allocation metrics
|
|
|
|
Free
cash flow
|
Page
43
|
Inflow
from operating activities
|
Page
44
|
Adjusted
free cash flow
|
Page
43
|
Inflow
from operating activities
|
Pages
16 and 44
|
Gross
debt
|
Page
43
|
Borrowings
|
Page
44
|
Net
debt
|
Page
43
|
Borrowings
less cash and cash equivalents
|
Page
44
|
Pre-tax
ROCE (controlled)
|
Page
45
|
ROCE
calculated using GAAP measures
|
Pages
45 and 46
|
Post-tax
ROCE (controlled and associates/joint ventures)
|
Page
45
|
ROCE
calculated using GAAP measures
|
Pages
45 and 46
|
Financing and Taxation metrics
|
|
|
|
Adjusted
net financing costs
|
Page
47
|
Net
financing costs
|
Page
14
|
Adjusted
profit before taxation
|
Page
47
|
Profit
before taxation
|
Page
48
|
Adjusted
income tax expense
|
Page
47
|
Income
tax expense
|
Page
48
|
Adjusted
effective tax rate
|
Page
47
|
Income
tax expense
|
Page
48
|
Adjusted
share of results of equity accounted associates and joint
ventures
|
Page
47
|
Share
of results of equity accounted associates and joint
ventures
|
Page
48
|
Adjusted
share of results of equity accounted associates and joint ventures
used in post-tax ROCE
|
Page
47
|
Share
of results of equity accounted associates and joint
ventures
|
Page
48
|
Non-GAAP measures
Performance metrics
Non-GAAP measure
|
Purpose
|
Definition
|
Adjusted
EBITDAaL
|
Adjusted
EBITDAaL is used in conjunction with financial measures such as
operating profit to assess our operating performance and
profitability.
It is a
key external metric used by the investor community to assess
performance of our operations.
It is
our segment performance measure in accordance with IFRS 8
(Operating Segments).
|
Adjusted
EBITDAaL is operating profit after depreciation on lease-related
right of use assets and interest on lease liabilities but excluding
depreciation, amortisation and gains/losses on disposal of owned
assets and excluding share of results of equity accounted
associates and joint ventures, impairment losses/reversals,
restructuring costs arising from discrete restructuring plans,
other income and expense and significant items that are not
considered by management to be reflective of the underlying
performance of the Group.
|
Adjusted EBITDAaL margin is Adjusted EBITDAaL divided by
Revenue.
Organic growth
Organic
growth presents performance on a comparable basis, excluding the
impact of foreign exchange rates, mergers and acquisitions, the
hyperinflation adjustment in Turkey and other adjustments to
improve the comparability of results between periods.
Organic growth is calculated for revenue and profitability metrics,
as follows:
- Adjusted
EBITDAaL;
- Revenue;
- Group
service revenue excluding Turkey;
- Group
Adjusted EBITDAaL excluding Turkey;
- Service
revenue;
- Mobile
service revenue;
- Fixed
service revenue;
- Vodafone
Business service revenue (Group and Operating segments);
and
- Financial
services revenue in South Africa.
Whilst organic growth is not intended to be a substitute for
reported growth, nor is it superior to reported growth, we believe
that the measure provides useful and necessary information to
investors and other interested parties for the following
reasons:
- It
provides additional information on underlying growth of the
business without the effect of certain factors unrelated to its
operating performance;
- It
is used for internal performance analysis; and
- It
facilitates comparability of underlying growth with other companies
(although the term 'organic' is not a defined term under GAAP and
may not, therefore, be comparable with similarly-titled measures
reported by other companies).
We have not provided a comparative in respect of organic growth
rates as the current rates describe the change between the
beginning and end of the current period, with such changes being
explained by the commentary in this document. If comparatives were
provided, significant sections of the commentary for prior periods
would also need to be included, reducing the usefulness and
transparency of this document.
Non-GAAP measures
Year ended 31 March 2024
|
|
|
|
|
|
|
|
|
Re-presented1
|
Reported growth
|
M&A and Other
|
Foreign exchange
|
Organic growth
|
|
|
FY24
|
FY23
|
|
|
€m
|
€m
|
%
|
pps
|
pps
|
%
|
Service revenue
|
|
|
|
|
|
|
Germany
|
11,453
|
11,433
|
0.2
|
-
|
-
|
0.2
|
|
Mobile service revenue
|
5,059
|
5,060
|
-
|
-
|
-
|
-
|
|
Fixed service revenue
|
6,394
|
6,373
|
0.3
|
-
|
-
|
0.3
|
UK
|
5,631
|
5,358
|
5.1
|
-
|
(0.1)
|
5.0
|
|
Mobile service revenue
|
4,142
|
3,928
|
5.4
|
-
|
-
|
5.4
|
|
Fixed service revenue
|
1,489
|
1,430
|
4.1
|
-
|
(0.2)
|
3.9
|
Other Europe2
|
4,722
|
5,005
|
(5.7)
|
10.6
|
(0.7)
|
4.2
|
Turkey3
|
1,746
|
1,593
|
9.6
|
10.7
|
68.2
|
88.5
|
Africa4
|
5,951
|
6,556
|
(9.2)
|
-
|
18.4
|
9.2
|
Common Functions
|
559
|
530
|
|
|
|
|
Eliminations
|
(150)
|
(157)
|
|
|
|
|
Total service revenue
|
29,912
|
30,318
|
(1.3)
|
1.9
|
5.7
|
6.3
|
Other revenue
|
6,805
|
7,354
|
|
|
|
|
Revenue
|
36,717
|
37,672
|
(2.5)
|
2.8
|
5.6
|
5.9
|
|
|
|
|
|
|
|
|
Other growth metrics
|
|
|
|
|
|
|
Group service revenue excluding Turkey
|
28,197
|
28,912
|
(2.5)
|
2.4
|
3.8
|
3.7
|
Group Adjusted EBITDAaL excluding Turkey
|
10,509
|
12,023
|
(12.6)
|
8.3
|
3.7
|
(0.6)
|
Turkey - Service revenue
|
1,746
|
1,440
|
21.3
|
(14.7)
|
81.9
|
88.5
|
Turkey - Adjusted EBITDAaL
|
510
|
401
|
27.2
|
(12.8)
|
85.5
|
99.9
|
Vodafone Business - Service revenue
|
7,735
|
7,757
|
(0.3)
|
1.8
|
3.5
|
5.0
|
Germany - Vodafone Business service revenue
|
2,422
|
2,421
|
-
|
-
|
-
|
-
|
UK - Vodafone Business service revenue
|
2,144
|
2,075
|
3.3
|
-
|
(0.1)
|
3.2
|
Other Europe - Vodafone Business service revenue
|
1,502
|
1,496
|
0.4
|
8.1
|
(0.6)
|
7.9
|
Turkey - Vodafone Business service revenue
|
233
|
194
|
20.1
|
(14.4)
|
81.7
|
87.4
|
South Africa - Financial services revenue
|
157
|
167
|
(6.0)
|
-
|
13.9
|
7.9
|
M-Pesa revenue
|
389
|
367
|
6.0
|
-
|
7.4
|
13.4
|
Notes:
1. The
results for the year ended 31 March 2023 have been re-presented to
reflect that the results of Vodafone Spain and Vodafone Italy are
now reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more
information.
2. The
comparative period includes the results of Vodafone Hungary which,
as previously reported, was sold in January
2023.
3. The
comparative period includes the results of Vodafone Ghana which, as
previously reported, was sold in February 2023.
4. From
1 April 2023, the Group revised its segmental reporting by moving
Vodafone Egypt to the Africa segment. The comparatives have been
re-presented on the new basis of segmental reporting. There is no
impact on previously reported Group
metrics.
Non-GAAP measures
Year ended 31 March 2024
|
|
|
|
|
|
|
|
|
Re-presented1
|
Reported growth
|
M&A and Other
|
Foreign exchange
|
Organic growth
|
|
|
FY24
|
FY23
|
|
|
€m
|
€m
|
%
|
pps
|
pps
|
%
|
Adjusted EBITDAaL
|
|
|
|
|
|
|
Germany
|
5,017
|
5,323
|
(5.8)
|
-
|
-
|
(5.8)
|
UK
|
1,408
|
1,350
|
4.3
|
-
|
(0.3)
|
4.0
|
Other Europe2
|
1,516
|
1,632
|
(7.1)
|
9.4
|
(0.8)
|
1.5
|
Turkey3
|
510
|
424
|
20.3
|
3.0
|
76.6
|
99.9
|
Africa4
|
2,539
|
2,880
|
(11.8)
|
-
|
18.2
|
6.4
|
Vantage Towers
|
-
|
795
|
|
|
|
|
Common Functions
|
29
|
20
|
|
|
|
|
Eliminations
|
-
|
-
|
|
|
|
|
Group
|
11,019
|
12,424
|
(11.3)
|
8.6
|
4.9
|
2.2
|
|
|
|
|
|
|
|
|
Percentage point change in Adjusted EBITDAaL margin
|
|
|
|
|
|
|
Germany
|
38.7%
|
40.6%
|
(1.9)
|
-
|
-
|
(1.9)
|
UK
|
20.6%
|
19.8%
|
0.8
|
-
|
-
|
0.8
|
Other Europe2
|
27.5%
|
28.4%
|
(0.9)
|
(0.5)
|
-
|
(1.4)
|
Turkey3
|
21.6%
|
20.5%
|
1.1
|
(0.2)
|
0.1
|
1.0
|
Africa4
|
34.2%
|
35.7%
|
(1.5)
|
-
|
0.4
|
(1.1)
|
Group
|
30.0%
|
33.0%
|
(3.0)
|
2.0
|
(0.1)
|
(1.1)
|
Notes:
1. The
results for the year ended 31 March 2023 have been re-presented to
reflect that the results of Vodafone Spain and Vodafone Italy are
now reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more
information.
2. The
comparative period includes the results of Vodafone Hungary which,
as previously reported, was sold in January
2023.
3. The
comparative period includes the results of Vodafone Ghana which, as
previously reported, was sold in February 2023.
4. From
1 April 2023, the Group revised its segmental reporting by moving
Vodafone Egypt to the Africa segment. The comparatives have been
re-presented on the new basis of segmental reporting. There is no
impact on previously reported Group
metrics.
Non-GAAP measures
Quarter ended 31 March 2024
|
|
|
|
|
|
|
|
|
|
Re-presented1
|
Reported growth
|
M&A and Other
|
Foreign exchange
|
Organic growth
|
|
|
Q4 FY24
|
Q4 FY23
|
|
|
€m
|
€m
|
%
|
pps
|
pps
|
%
|
Service revenue
|
|
|
|
|
|
|
Germany
|
2,839
|
2,821
|
0.6
|
-
|
-
|
0.6
|
|
Mobile service revenue
|
1,257
|
1,235
|
1.8
|
-
|
-
|
1.8
|
|
Fixed service revenue
|
1,582
|
1,586
|
(0.3)
|
0.1
|
-
|
(0.2)
|
UK
|
1,409
|
1,319
|
6.8
|
-
|
(3.2)
|
3.6
|
|
Mobile service revenue
|
1,012
|
948
|
6.8
|
-
|
(3.1)
|
3.7
|
|
Fixed service revenue
|
397
|
371
|
7.0
|
-
|
(3.5)
|
3.5
|
Other Europe2
|
1,181
|
1,178
|
0.3
|
4.8
|
0.4
|
5.5
|
Turkey3
|
525
|
454
|
15.6
|
1.1
|
88.9
|
105.6
|
Africa4
|
1,484
|
1,466
|
1.2
|
-
|
8.8
|
10.0
|
Common Functions
|
140
|
128
|
|
|
|
|
Eliminations
|
(32)
|
(31)
|
|
|
|
|
Total service revenue
|
7,546
|
7,335
|
2.9
|
0.2
|
4.0
|
7.1
|
Other revenue
|
1,842
|
1,793
|
|
|
|
|
Revenue
|
9,388
|
9,128
|
2.8
|
1.2
|
4.3
|
8.3
|
|
|
|
|
|
|
|
|
Other growth metrics
|
|
|
|
|
|
|
Group service revenue excluding Turkey
|
7,027
|
6,913
|
1.6
|
1.1
|
1.3
|
4.0
|
Turkey - Service revenue
|
525
|
430
|
22.1
|
(18.2)
|
101.7
|
105.6
|
Vodafone Business - Service revenue
|
1,979
|
1,918
|
3.2
|
0.4
|
1.8
|
5.4
|
Germany - Vodafone Business service revenue
|
605
|
599
|
1.0
|
-
|
-
|
1.0
|
UK - Vodafone Business service revenue
|
545
|
531
|
2.6
|
-
|
(3.1)
|
(0.5)
|
Other Europe - Vodafone Business service revenue
|
399
|
369
|
8.1
|
3.5
|
0.6
|
12.2
|
Turkey - Vodafone Business service revenue
|
71
|
59
|
20.3
|
(17.9)
|
99.8
|
102.2
|
Notes:
1. The
results for the quarter ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' in the condensed
consolidated financial statements for more
information.
2. The
comparative period includes the results of Vodafone Hungary which,
as previously reported, was sold in January
2023.
3. The
comparative period includes the results of Vodafone Ghana which, as
previously reported, was sold in February 2023.
4. From
1 April 2023, the Group revised its segmental reporting by moving
Vodafone Egypt to the Africa segment. The comparatives have been
re-presented on the new basis of segmental reporting. There is no
impact on previously reported Group
metrics.
Non-GAAP measures
Quarter ended 31 December 2023
|
|
|
|
|
|
|
|
|
|
Re-presented1
|
Reported growth
|
M&A and Other
|
Foreign exchange
|
Organic growth
|
|
|
Q3 FY24
|
Q3 FY23
|
|
|
€m
|
€m
|
%
|
pps
|
pps
|
%
|
Service revenue
|
|
|
|
|
|
|
Germany
|
2,892
|
2,882
|
0.3
|
-
|
-
|
0.3
|
|
Mobile service revenue
|
1,272
|
1,279
|
(0.5)
|
-
|
-
|
(0.5)
|
|
Fixed service revenue
|
1,620
|
1,603
|
1.1
|
(0.1)
|
-
|
1.0
|
UK
|
1,400
|
1,327
|
5.5
|
-
|
(0.3)
|
5.2
|
|
Mobile service revenue
|
1,034
|
977
|
5.8
|
-
|
(0.4)
|
5.4
|
|
Fixed service revenue
|
366
|
350
|
4.6
|
-
|
-
|
4.6
|
Other Europe2
|
1,175
|
1,275
|
(7.8)
|
12.4
|
(1.0)
|
3.6
|
Turkey3
|
393
|
368
|
6.8
|
19.5
|
64.1
|
90.4
|
Africa4
|
1,543
|
1,668
|
(7.5)
|
-
|
16.3
|
8.8
|
Common Functions
|
137
|
134
|
|
|
|
|
Eliminations
|
(35)
|
(37)
|
|
|
|
|
Total service revenue
|
7,505
|
7,617
|
(1.5)
|
2.5
|
5.3
|
6.3
|
Other revenue
|
1,841
|
1,978
|
|
|
|
|
Revenue
|
9,346
|
9,595
|
(2.6)
|
3.3
|
5.2
|
5.9
|
|
|
|
|
|
|
|
|
Other growth metrics
|
|
|
|
|
|
|
Group service revenue excluding Turkey
|
7,119
|
7,290
|
(2.3)
|
2.7
|
3.2
|
3.6
|
Turkey - Service revenue
|
393
|
334
|
17.7
|
(10.7)
|
83.4
|
90.4
|
Vodafone Business - Service revenue
|
1,943
|
1,954
|
(0.6)
|
2.5
|
3.1
|
5.0
|
Germany - Vodafone Business service revenue
|
612
|
629
|
(2.7)
|
0.8
|
-
|
(1.9)
|
UK - Vodafone Business service revenue
|
540
|
508
|
6.3
|
-
|
(0.5)
|
5.8
|
Other Europe - Vodafone Business service revenue
|
375
|
380
|
(1.3)
|
9.7
|
(0.6)
|
7.8
|
Turkey - Vodafone Business service revenue
|
53
|
44
|
20.5
|
(34.4)
|
108.6
|
94.7
|
Notes:
1. The
results for the quarter ended 31 December 2022 have been
re-presented to reflect that the results of Vodafone Spain and
Vodafone Italy are now reported as discontinued operations. See
note 3 'Discontinued operations and assets held for sale' in the
condensed consolidated financial statements for more
information.
2. The
comparative period includes the results of Vodafone Hungary which,
as previously reported, was sold in January
2023.
3. The
comparative period includes the results of Vodafone Ghana which, as
previously reported, was sold in February 2023.
4. From
1 April 2023, the Group revised its segmental reporting by moving
Vodafone Egypt to the Africa segment. The comparatives have been
re-presented on the new basis of segmental reporting. There is no
impact on previously reported Group
metrics.
Non-GAAP measures
Other metrics
Non-GAAP
measure
|
Purpose
|
Definition
|
Adjusted
profit attributable to owners of the parent
|
This
metric is used in the calculation of Adjusted basic earnings per
share.
|
Adjusted
profit attributable to owners of the parent excludes restructuring
costs arising from discrete restructuring plans, amortisation of
customer bases and brand intangible assets, impairment
losses/reversals, other income and expense and mark-to-market and
foreign exchange movements, together with related tax
effects.
|
Adjusted
basic earnings per share
|
This
performance measure is used in discussions with the investor
community.
|
Adjusted
basic earnings per share is Adjusted profit attributable to owners
of the parent divided by the weighted average number of shares
outstanding. This is the same denominator used when calculating
basic earnings per share.
|
Adjusted EBITDAaL and Adjusted profit attributable to owners of the
parent
The table below reconciles Adjusted EBITDAaL and Adjusted profit
attributable to owners of the parent to their closest equivalent
GAAP measures, being Operating profit and Profit attributable to
owners of the parent, respectively.
|
|
|
|
|
|
FY24
|
FY23 Re-presented1
|
|
Reported
|
Adjustments
|
Adjusted
|
Reported
|
Adjustments
|
Adjusted
|
|
€m
|
€m
|
€m
|
€m
|
€m
|
€m
|
Adjusted EBITDAaL
|
11,019
|
-
|
11,019
|
12,424
|
-
|
12,424
|
Restructuring costs
|
(703)
|
703
|
-
|
(538)
|
538
|
-
|
Interest on lease liabilities
|
440
|
-
|
440
|
355
|
-
|
355
|
Loss on disposal of property, plant & equipment and intangible
assets
|
(34)
|
-
|
(34)
|
(41)
|
-
|
(41)
|
Depreciation and amortisation on owned assets2
|
(7,397)
|
606
|
(6,791)
|
(7,520)
|
555
|
(6,965)
|
Share of results of equity accounted associates and joint
ventures3
|
(96)
|
323
|
227
|
433
|
220
|
653
|
Impairment reversal/(loss)
|
64
|
(64)
|
-
|
(64)
|
64
|
-
|
Other income
|
372
|
(372)
|
-
|
9,402
|
(9,402)
|
-
|
Operating profit
|
3,665
|
1,196
|
4,861
|
14,451
|
(8,025)
|
6,426
|
Investment income
|
581
|
-
|
581
|
232
|
-
|
232
|
Financing costs4
|
(2,626)
|
270
|
(2,356)
|
(1,609)
|
(399)
|
(2,008)
|
Profit before taxation
|
1,620
|
1,466
|
3,086
|
13,074
|
(8,424)
|
4,650
|
Income tax expense5
|
(50)
|
(650)
|
(700)
|
(492)
|
(532)
|
(1,024)
|
Profit for the financial year from continuing
operations
|
1,570
|
816
|
2,386
|
12,582
|
(8,956)
|
3,626
|
Loss for the financial year from discontinued
operations
|
(65)
|
65
|
-
|
(247)
|
247
|
-
|
Profit for the financial year
|
1,505
|
881
|
2,386
|
12,335
|
(8,709)
|
3,626
|
|
|
|
|
|
|
|
Profit attributable to:
|
|
|
|
|
|
|
- Owners of the parent (Continuing)
|
1,205
|
816
|
2,021
|
12,085
|
(8,962)
|
3,123
|
- Owners of the parent (Total Group)
|
1,140
|
881
|
2,021
|
11,838
|
(8,715)
|
3,123
|
- Non-controlling interests
|
365
|
-
|
365
|
497
|
6
|
503
|
Profit for the financial year
|
1,505
|
881
|
2,386
|
12,335
|
(8,709)
|
3,626
|
Notes:
1. The
results for the year ended 31 March 2023 have been re-presented to
reflect that the results of Vodafone Spain and Vodafone Italy are
now reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more
information.
2. Depreciation
and amortisation on owned assets excludes depreciation on leased
assets and loss on disposal of leased assets included within
Adjusted EBITDAaL. See page 49 for an analysis of depreciation and
amortisation. The adjustment of €606 million (FY23:
€555 million) relates to amortisation of customer bases and
brand intangible assets.
3. See
page 48 for a breakdown of the adjustments to Share of results of
equity accounted associates and joint ventures to derive Adjusted
share of results of equity accounted associates and joint
ventures.
4. See
'Net financing costs' on page 14 for further
analysis.
5. See
'Adjusted tax metrics' on page 48 for further analysis.
Non-GAAP measures
Adjusted basic earnings per share
The reconciliation of Adjusted basic earnings per share to the
closest equivalent GAAP measure, basic earnings per share, is
provided below.
|
|
Re-presented1
|
|
FY24
|
FY23
|
|
€m
|
€m
|
Profit attributable to owners of the parent
|
1,140
|
11,838
|
Adjusted profit attributable to owners of the parent
|
2,021
|
3,123
|
|
|
|
|
Million
|
Million
|
Weighted average number of shares outstanding - Basic
|
27,056
|
27,680
|
|
|
|
|
eurocents
|
eurocents
|
Basic earnings per share
|
4.21c
|
42.77c
|
Adjusted basic earnings per share
|
7.47c
|
11.28c
|
Note:
1. The
results for the year ended 31 March 2023 have been re-presented to
reflect that the results of Vodafone Spain and Vodafone Italy are
now reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more
information.
Cash flow, funding and capital allocation metrics
Cash flow and funding
Non-GAAP measure
|
Purpose
|
Definition
|
Free
cash flow
|
Internal
performance reporting.
External
metric used by investor community.
Assists
comparability with other companies, although our metric may not be
directly comparable to similarly titled measures used by other
companies.
|
Free
cash flow is Adjusted EBITDAaL after cash flows in relation to
capital additions, working capital movements including in respect
of capital additions, disposal of property, plant and equipment and
intangible assets, integration capital additions and restructuring
costs, together with related working capital, licences and
spectrum, interest received and paid, taxation, dividends received
from associates and joint ventures, dividends paid to
non-controlling shareholders in subsidiaries, payments in respect
of lease liabilities and other.
|
Adjusted
free cash flow
|
Internal
performance reporting.
External
metric used by investor community.
Setting
director and management remuneration.
Key
external metric used to evaluate liquidity and the cash generated
by our operations.
|
Adjusted
free cash flow is Free cash flow before licences and spectrum,
restructuring costs arising from discrete restructuring plans,
integration capital additions and working capital related items,
M&A and (prior to disposal) Vantage Towers growth capital
expenditure.
Growth
capital expenditure is total capital expenditure excluding
maintenance-type expenditure.
|
Gross
debt
|
Prominent
metric used by debt rating agencies and the investor
community.
|
Non-current
borrowings and current borrowings, excluding lease liabilities,
collateral liabilities and borrowings specifically secured against
Indian assets.
|
Net
debt
|
Prominent
metric used by debt rating agencies and the investor
community.
|
Gross
debt less cash and cash equivalents, short-term investments,
derivative financial instruments excluding mark-to-market
adjustments and net collateral assets.
|
Non-GAAP measures
Cash flow and funding (continued)
The table below presents the reconciliation between Inflow from
operating activities and Free cash flow.
|
|
Re-presented1
|
|
FY24
|
FY23
|
|
€m
|
€m
|
Inflow from operating activities
|
16,557
|
18,054
|
Net tax paid
|
724
|
1,228
|
Cashflows from discontinued operations
|
(3,296)
|
(3,464)
|
Cash generated by operations
|
13,985
|
15,818
|
Capital additions
|
(6,331)
|
(7,067)
|
Working capital movement in respect of capital
additions
|
(141)
|
(120)
|
Disposal of property, plant and equipment and intangible
assets
|
14
|
90
|
Integration capital additions
|
(81)
|
(200)
|
Working capital movement in respect of integration capital
additions
|
(37)
|
(5)
|
Licences and spectrum
|
(454)
|
(773)
|
Interest received and paid2
|
(1,685)
|
(1,468)
|
Taxation
|
(724)
|
(1,228)
|
Dividends received from associates and joint ventures
|
442
|
617
|
Dividends paid to non-controlling shareholders in
subsidiaries
|
(260)
|
(400)
|
Payments in respect of lease liabilities
|
(3,135)
|
(2,747)
|
Other
|
190
|
66
|
Free cash flow
|
1,783
|
2,583
|
Notes:
1. The results for the year ended 31
March 2023 have been re-presented to reflect that the results of
Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 3 'Discontinued operations and assets held for
sale' in the condensed consolidated financial statements for more
information.
2. Includes interest on lease
liabilities of €406 million (FY23: €296 million),
excluding discontinued operations.
The table below presents the reconciliation between Borrowing,
Gross debt and Net debt.
|
|
Year-end FY24
|
Year-end FY23
|
|
|
€m
|
€m
|
Borrowings
|
(56,987)
|
(66,390)
|
Lease liabilities
|
9,672
|
13,364
|
Bank borrowings secured against Indian assets
|
1,720
|
1,485
|
Collateral liabilities
|
2,628
|
4,886
|
Gross debt
|
(42,967)
|
(46,655)
|
Collateral liabilities
|
(2,628)
|
(4,886)
|
Cash and cash equivalents
|
6,183
|
11,705
|
Short-term investments
|
3,225
|
4,305
|
Collateral assets
|
741
|
239
|
Derivative financial instruments
|
2,702
|
4,702
|
Less mark-to-market gains deferred in hedge reserves
|
(498)
|
(2,785)
|
Net debt
|
(33,242)
|
(33,375)
|
Non-GAAP measures
Return on Capital Employed
Non-GAAP measure
|
Purpose
|
Definition
|
Return
on Capital Employed ('ROCE')
|
ROCE is
a metric used by the investor community and reflects how
efficiently we are generating profit with the capital we
deploy.
|
We
calculate ROCE by dividing Operating profit by the average of
capital employed as reported in the consolidated statement of
financial position. Capital employed includes borrowings, cash and
cash equivalents, derivative financial instruments included in
trade and other receivables/payables, short-term investments,
collateral assets, financial liabilities under put option
arrangements and equity.
|
Pre-tax
ROCE (controlled)
Post-tax
ROCE (controlled and associates/joint ventures)
|
As
above
|
We calculate pre-tax ROCE (controlled) by using Operating profit
excluding interest on lease liabilities, restructuring costs
arising from discrete restructuring plans, impairment
losses/reversals, other income and expense, the impact of
hyper-inflationary adjustments in Turkey and the share of results
of equity accounted associates and joint ventures. On a post-tax
basis, the measure includes our Adjusted share of results from
associates and joint ventures and a notional tax charge. Capital is
equivalent to net operating assets and is calculated as the average
of opening and closing balances of: property, plant and equipment
(including leased assets and lease liabilities), intangible assets
(including goodwill), operating working capital (including held for
sale assets and excluding derivative balances) and provisions,
excluding the impact of hyper-inflationary adjustments in Turkey.
Other assets that do not directly contribute to returns are
excluded from this measure and include other investments, current
and deferred tax balances and post employment
benefits. On
a post-tax basis, ROCE also includes our investments in associates
and joint ventures.
|
ROCE using GAAP measures
The table below presents the calculation of ROCE using GAAP
measures as reported in the consolidated income statement and
consolidated statement of financial position.
|
|
Re-presented1
|
|
FY24
|
FY23
|
|
€m
|
€m
|
Operating profit2
|
3,665
|
14,451
|
|
|
|
Borrowings
|
56,987
|
66,390
|
Cash and cash equivalents
|
(6,183)
|
(11,705)
|
Derivative financial instruments included in trade and other
receivables
|
(4,226)
|
(6,124)
|
Derivative financial instruments included in trade and other
payables
|
1,524
|
1,422
|
Short-term investments
|
(3,225)
|
(4,305)
|
Collateral assets
|
(741)
|
(239)
|
Financial liabilities under put option arrangements
|
-
|
485
|
Equity
|
60,998
|
64,483
|
Capital employed at end of the year
|
105,134
|
110,407
|
|
|
|
Average capital employed for the year
|
107,771
|
111,062
|
|
|
|
ROCE using GAAP measures
|
3.4%
|
13.0%
|
Notes:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' in the condensed
consolidated financial statements for more
information.
2.
Operating profit includes Other income/(expense), which includes
merger and acquisition activity that is non-recurring in
nature.
Non-GAAP measures
Return on Capital Employed ('ROCE') : Non-GAAP basis
The table below presents the calculation of ROCE using non-GAAP
measures and reconciliations to the closest equivalent GAAP
measure.
|
|
Re-presented1
|
|
FY242
|
FY232
|
|
€m
|
€m
|
Operating profit
|
3,665
|
14,451
|
Interest on lease liabilities
|
(440)
|
(355)
|
Restructuring costs
|
703
|
538
|
Other income
|
(372)
|
(9,402)
|
Share of results of equity accounted associates and joint
ventures
|
96
|
(433)
|
Impairment (reversal)/loss
|
(64)
|
64
|
Other adjustments3
|
296
|
(413)
|
Adjusted operating profit for calculating pre-tax ROCE
(controlled)
|
3,884
|
4,450
|
Adjusted share of results of equity accounted associates and joint
ventures used in post-tax ROCE4
|
(116)
|
430
|
Notional tax at Adjusted effective tax rate5
|
(923)
|
(1,249)
|
Adjusted operating profit for calculating post-tax ROCE (controlled
and associates/joint ventures)
|
2,845
|
3,631
|
|
|
|
Capital employed for calculating ROCE on a GAAP basis
|
105,134
|
110,407
|
Adjustments to exclude:
|
|
|
- Leases
|
(9,672)
|
(13,364)
|
- Deferred tax assets
|
(20,177)
|
(19,316)
|
- Deferred tax liabilities
|
699
|
771
|
- Taxation recoverable
|
(76)
|
(279)
|
- Taxation liabilities
|
393
|
457
|
- Other investments
|
(1,543)
|
(1,781)
|
- Investments in associates and joint ventures
|
(10,032)
|
(11,079)
|
- Pension assets and liabilities
|
(76)
|
(71)
|
- Removal of capital employed related to discontinued
operations
|
(12,129)
|
(12,180)
|
- Other adjustments3
|
(1,009)
|
(877)
|
Adjusted capital employed for calculating pre-tax ROCE
(controlled)
|
51,512
|
52,688
|
Investments in associates and joint ventures2
|
10,032
|
11,079
|
Adjusted capital employed for calculating post-tax ROCE (controlled
and associates/joint ventures)
|
61,544
|
63,767
|
|
|
|
Average capital employed for
calculating pre-tax ROCE (controlled)2
|
52,100
|
54,440
|
Average capital employed for
calculating post-tax ROCE (controlled and associates/joint
ventures)2
|
62,656
|
59,713
|
|
|
|
Pre-tax ROCE (controlled)
|
7.5%
|
8.2%
|
Post-tax ROCE (controlled and associates/joint
ventures)
|
4.5%
|
6.1%
|
Notes:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' in the condensed
consolidated financial statements for more
information.
2.
FY23 ROCE calculations exclude the results of Vantage Towers until
its disposal on 22 March 2023 and the investment in Oak Holdings 1
GmbH from that date. FY23 capital employed for calculating post-tax
ROCE (controlled and associates/joint ventures), FY22 Capital
employed for calculating pre-tax ROCE (controlled) and FY22 capital
employed for calculating post-tax ROCE (controlled and
associates/joint ventures) have been adjusted to €57,911
million, €56,192 million and €61,515 million,
respectively, for the purposes of calculating relevant FY23
averages.
3.
Comprises adjustments to exclude hyperinflationary accounting in
Turkey.
4.
Adjusted share of results of equity accounted associates and joint
ventures used in post-tax ROCE is a non-GAAP measure and excludes
restructuring costs and other income.
5.
Includes tax at the Adjusted effective tax rate of 24.5% (FY23:
25.6%).
Non-GAAP measures
Financing and Taxation metrics
Non-GAAP measure
|
Purpose
|
Definition
|
Adjusted
net financing costs
|
This
metric is used by both management and the investor
community.
This
metric is used in the calculation of Adjusted basic earnings per
share.
|
Adjusted
net financing costs exclude mark-to-market and foreign exchange
gains/losses.
|
Adjusted
profit before taxation
|
This
metric is used in the calculation of the Adjusted effective tax
rate (see below).
|
Adjusted
profit before taxation excludes the tax effects of items excluded
from Adjusted basic earnings per share, including: impairment
losses/reversals, amortisation of customer bases and brand
intangible assets, restructuring costs arising from discrete
restructuring plans, other income and expense and mark-to-market
and foreign exchange movements.
|
Adjusted
income tax expense
|
This
metric is used in the calculation of the Adjusted effective tax
rate (see below).
|
Adjusted
income tax expense excludes the tax effects of items excluded from
Adjusted basic earnings per share, including: impairment
losses/reversals, amortisation of customer bases and brand
intangible assets, restructuring costs arising from discrete
restructuring plans, other income and expense and mark-to-market
and foreign exchange movements. It also excludes deferred tax
movements relating to tax losses in Luxembourg as well as other
significant one-off items.
|
Adjusted
effective tax rate
|
This
metric is used by both management and the investor
community.
|
Adjusted
income tax expense (see above) divided by Adjusted profit before
taxation (see above).
|
Adjusted
share of results of equity accounted associates and joint
ventures
|
This
metric is used in the calculation of Adjusted effective tax
rate.
|
Share
of results of equity accounted associates and joint ventures
excluding restructuring costs, amortisation of acquired customer
base and brand intangible assets and other income and
expense.
|
Adjusted
share of results of equity accounted associates and joint ventures
used in post-tax ROCE
|
This
metric is used in the calculation of post-tax ROCE (controlled and
associates/joint ventures).
|
Share
of results of equity accounted associates and joint ventures
excluding restructuring costs and other income and
expense.
|
Non-GAAP measures
Adjusted tax metrics
The table below reconciles Profit before taxation and Income tax
expense to Adjusted profit before taxation, Adjusted income tax
expense and Adjusted effective tax rate.
|
|
|
Re-presented1
|
|
FY24
|
FY23
|
|
€m
|
€m
|
Profit before taxation
|
1,620
|
13,074
|
Adjustments to derive Adjusted profit before tax
|
1,466
|
(8,424)
|
Adjusted profit before taxation
|
3,086
|
4,650
|
Adjusted share of results of equity accounted associates and joint
ventures
|
(227)
|
(653)
|
Adjusted profit before tax for calculating Adjusted effective tax
rate
|
2,859
|
3,997
|
|
|
|
|
Income tax expense
|
(50)
|
(492)
|
Tax on adjustments to derive Adjusted profit before
tax
|
(342)
|
(205)
|
Adjustments:
|
|
|
- Deferred tax on recognition of Luxembourg losses in the
year
|
(1,019)
|
-
|
- Deferred tax on use of Luxembourg losses in the
year
|
598
|
33
|
- UK corporate interest restriction
|
78
|
15
|
- Tax relating to hyperinflation accounting
|
35
|
(309)
|
- Tax relating to Vantage Towers disposal
|
-
|
(66)
|
Adjusted income tax expense for calculating Adjusted tax
rate
|
(700)
|
(1,024)
|
Adjusted effective tax rate
|
24.5%
|
25.6%
|
Note:
1.
The results for the year ended 31 March 2023 have been re-presented
to reflect that the results of Vodafone Spain and Vodafone Italy
are now reported as discontinued operations. See note 3
'Discontinued operations and assets held for sale' in the condensed
consolidated financial statements for more
information.
Adjusted share of results of equity accounted associates and joint
ventures
The table below reconciles Adjusted share of results of equity
accounted associates and joint ventures to the closest GAAP
equivalent, Share of results of equity accounted associates and
joint ventures.
|
FY24
|
FY23
|
|
€m
|
€m
|
Share of results of equity accounted associates and joint
ventures
|
(96)
|
433
|
Restructuring costs
|
7
|
6
|
Other income
|
(27)
|
(9)
|
Adjusted share of results of equity accounted associates and joint
ventures used in post-tax ROCE
|
(116)
|
430
|
Amortisation of acquired customer base and brand intangible
assets
|
343
|
223
|
Adjusted share of results of equity accounted associates and joint
ventures
|
227
|
653
|
Additional information
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Analysis of depreciation and amortisation
The table below presents an analysis of the different components of
depreciation and amortisation discussed in the document, reconciled
to the GAAP amounts in the consolidated income
statement.
|
|
|
Re-presented1
|
|
|
FY24
|
FY23
|
|
€m
|
€m
|
Depreciation on leased assets - included in Adjusted
EBITDAaL
|
3,003
|
2,682
|
Depreciation on leased assets - included in Restructuring
costs
|
14
|
51
|
Depreciation on leased assets
|
3,017
|
2,733
|
|
|
|
|
Depreciation on owned assets
|
3,882
|
4,140
|
Amortisation of owned intangible assets
|
3,515
|
3,380
|
Depreciation and amortisation on owned assets included in
Restructuring costs
|
-
|
2
|
Depreciation and amortisation on owned assets
|
7,397
|
7,522
|
|
|
|
|
Total depreciation and amortisation on owned and leased
assets
|
10,414
|
10,255
|
|
|
|
|
Loss on disposal of owned fixed assets
|
34
|
41
|
Loss on disposal of leased assets
|
-
|
(8)
|
Depreciation and amortisation - as recognised in the consolidated
income statement
|
10,448
|
10,288
|
Note:
1. The results
for the year ended 31 March 2023 have been re-presented to reflect
that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations. See note 3 'Discontinued
operations and assets held for sale' in the condensed consolidated
financial statements for more information.
Analysis of tangible and intangible additions
The table below presents an analysis of the different components of
tangible and intangible additions discussed in the
document.
|
|
FY24
|
FY23
|
|
|
€m
|
€m
|
|
Capital additions
|
6,331
|
8,378
|
|
Integration related capital additions
|
81
|
287
|
|
Licence and spectrum additions
|
283
|
439
|
|
Additions
|
6,695
|
9,104
|
|
|
|
|
|
|
Intangible asset additions
|
2,622
|
3,250
|
|
Property, plant and equipment owned additions
|
4,073
|
5,854
|
|
Total additions
|
6,695
|
9,104
|
|
Definitions
|
|
|
Key terms are defined below. See page 36 for the location of
definitions for non-GAAP measures.
Term
|
Definition
|
Africa
|
Comprises
the Vodacom Group.
|
ARPU
|
Average
revenue per user, defined as customer revenue and incoming revenue
divided by average customers.
|
Capital
additions
|
Comprises
the purchase of property, plant and equipment and intangible
assets, other than licence and spectrum payments and integration
capital expenditure.
|
Common
Functions
|
Comprises
central teams and business functions.
|
Converged
customer
|
A
customer who receives fixed and mobile services (also known as
unified communications) on a single bill or who receives a discount
across both bills.
|
Depreciation
and amortisation
|
The
accounting charge that allocates the cost of tangible or intangible
assets, whether owned or leased, to the income statement over its
useful life. The measure includes the profit or loss on disposal of
property, plant and equipment, software and leased
assets.
|
Eliminations
|
Refers
to the removal of intercompany transactions to derive the
consolidated financial statements.
|
Europe
|
Comprises
the Group's European businesses and the UK.
|
Financial
services revenue
|
Financial
services revenue includes fees generated from the provision of
advanced airtime, overdraft, financing and lending facilities, as
well as merchant payments and the sale of insurance products (e.g.
device insurance, life insurance and funeral cover).
|
Fixed
service revenue
|
Service
revenue (see below) relating to the provision of fixed line and
carrier services.
|
FTTH
|
Fibre
to the home.
|
GAAP
|
Generally
Accepted Accounting Principles.
|
IFRS
|
International
Financial Reporting Standards.
|
Incoming
revenue
|
Comprises
revenue from termination rates for voice and messaging to Vodafone
customers.
|
Integration
capital additions
|
Capital
additions incurred in relation to significant changes in the
operating model, such as the integration of recently acquired
subsidiaries.
|
Internet
of Things ('IoT')
|
The
network of physical objects embedded with electronics, software,
sensors, and network connectivity, including built-in mobile SIM
cards, that enable these objects to collect data and exchange
communications with one another or a database.
|
Mobile
service revenue
|
Service
revenue (see below) relating to the provision of mobile
services.
|
MVNO
|
Companies
that provide mobile phone services under wholesale contracts with a
mobile network operator, but do not have their own licence or
spectrum or the infrastructure required to operate a
network.
|
Operating
expenses
|
Comprise
primarily sales and distribution costs, network and IT related
expenditure and business support costs.
|
Other
Europe
|
Other
Europe markets comprise Portugal, Ireland, Greece, Romania, Czech
Republic and Albania. The prior period comparative results include
Vodafone Hungary which was disposed of in January
2023.
|
Other
revenue
|
Other
revenue principally includes equipment revenue, interest income,
income from partner market arrangements and lease revenue,
including in respect of the lease out of passive tower
infrastructure.
|
Reported
growth
|
Reported
growth is based on amounts reported in euros and determined under
IFRS.
|
Revenue
|
The
total of Service revenue (see below) and Other revenue (see
above).
|
Roaming
|
Roaming
allows customers to make calls, send and receive texts and data on
our and other operators' mobile networks, usually while travelling
abroad.
|
Service
revenue
|
Service
revenue is all revenue related to the provision of ongoing services
to the Group's consumer and enterprise customers, together with
roaming revenue, revenue from incoming and outgoing network usage
by non-Vodafone customers and interconnect charges for incoming
calls.
|
SME
|
Small
and medium sized enterprises.
|
Vodafone
Business
|
Vodafone
Business supports organisations in a digital world. With Vodafone's
expertise in connectivity, our leading IoT platform and our global
scale, we deliver the results that organisations need to progress
and thrive. We support businesses of all sizes and
sectors.
|
1. References
to Vodafone are to Vodafone Group Plc and references to Vodafone
Group are to Vodafone Group Plc and its subsidiaries unless
otherwise stated. Vodafone, the Vodafone Speech Mark Devices,
Vodacom and Together we can are trade marks owned by Vodafone.
Other product and company names mentioned herein may be the trade
marks of their respective owners.
2. All
growth rates reflect a comparison to the quarter ended 31 March
2023 unless otherwise stated.
3. References
to "Q1", "Q2", "Q3" and "Q4" are to the three months ended 30 June,
30 September, 31 December and 31 March. References to the "year",
"financial year" or "FY24" are to the financial year ended 31 March
2024. References to "last year", "last financial year" or "FY23"
are to the financial year ended 31 March 2023. References to "H1
FY24" are to the six month period ended 30 September 2023.
References to "H1 FY23" are to the six month period ended 30
September 2022.
4. Vodacom
refers to the Group's interest in Vodacom Group Limited ('Vodacom')
as well as its operations, including subsidiaries in South Africa,
Egypt, DRC, Tanzania, Mozambique and
Lesotho.
5. This
document contains references to our and our affiliates' websites.
Information on any website is not incorporated into this update and
should not be considered part of this update.
Forward-looking statements and other matters
|
|
|
This
document contains 'forward-looking statements' within the meaning
of the US Private Securities Litigation Reform Act of 1995 with
respect to the Group's financial condition, results of operations
and businesses and certain of the Group's plans and objectives. In
particular, such forward-looking statements include, but are not
limited to, statements with respect to: the Group's portfolio
transformation plan; expectations regarding the Group's financial
condition or results of operations and the guidance for Adjusted
EBITDAaL and Adjusted free cash flow for the financial year ending
31 March 2025; the announced agreement to combine Vodafone UK and
Three UK; the announced agreements to dispose of Vodafone Spain and
Vodafone Italy; changes to German TV laws and the migration
of users to individual TV customer contracts; expectations for the
Group's future performance generally; the transaction to purchase
Nowo Communications; the Group's strategic partnership with
Microsoft; the digital transformation of the Group's business
customers; the Group's partnership with DCC in the UK; expectations
regarding the operating environment and market conditions and
trends, including customer usage, competitive position and
macroeconomic pressures, price trends and opportunities in specific
geographic markets; intentions and expectations regarding the
development, launch and expansion of products, services and
technologies, either introduced by Vodafone or by Vodafone in
conjunction with third parties or by third parties independently;
expectations regarding the integration or performance of current
and future investments, associates, joint ventures, non-controlled
interests and newly acquired businesses; the impact of regulatory
and legal proceedings involving the Group and of scheduled or
potential regulatory changes; certain of the Group's plans and
objectives, including the Group's strategy.
Forward-looking statements are
sometimes but not always identified by their use of a date in the
future or such words as 'will', 'may', 'expects', 'believes',
'intends', 'plans', 'further', 'ongoing', 'anticipates', 'could' or
'targets'. By their nature, forward-looking statements are
inherently predictive, speculative and involve risk and uncertainty
because they relate to events and depend on circumstances that will
occur in the future. There are a number of factors that could cause
actual results and developments to differ materially from those
expressed or implied by these forward-looking statements. These
factors include, but are not limited to the following: general
economic and political conditions in the jurisdictions in which the
Group operates and changes to the associated legal, regulatory and
tax environments; increased competition; levels of investment in
network capacity and the Group's ability to deploy new
technologies, products and services, including artificial
intelligence; the
Group's ability to optimise its portfolio in line with its business
transformation plan; evolving
cyber threats to the Group's services and confidential data; rapid
changes to existing products and services and the inability of new
products and services to perform in accordance with expectations;
the ability of the Group to integrate new technologies, products
and services with existing networks, technologies, products and
services; the Group's ability to generate and grow revenue; slower
than expected impact of new or existing products, services or
technologies on the Group's future revenue, cost structure and
capital expenditure outlays; slower than expected customer growth,
reduced customer retention, reductions or changes in customer
spending and increased pricing pressure; the Group's ability to
extend and expand its spectrum resources, to support ongoing growth
in customer demand for mobile data services; the Group's ability to
secure the timely delivery of high-quality products from suppliers;
loss of suppliers, disruption of supply chains, shortages and
greater than anticipated prices of new mobile handsets; changes in
the costs to the Group of, or the rates the Group may charge for,
terminations and roaming minutes; the impact of a failure or
significant interruption to the Group's telecommunications, data
centres, networks, IT systems or data protection systems; the
Group's ability to realise expected benefits from acquisitions,
partnerships, joint ventures, associates, franchises, brand
licences, platform sharing or other arrangements with third
parties, including the signed agreement to combine Vodafone's UK
business with Three UK and the Group's strategic partnership with
Microsoft; acquisitions and divestments of Group businesses and
assets and the pursuit of new, unexpected strategic opportunities;
the Group's ability to integrate acquired business or assets; the
extent of any future write-downs or impairment charges on the
Group's assets, or restructuring charges incurred as a result of an
acquisition or disposition; developments in the Group's financial
condition, earnings and distributable funds and other factors that
the Board takes into account in determining the level of dividends;
the Group's ability to satisfy working capital requirements;
changes in foreign exchange rates; changes in the regulatory
framework in which the Group operates; the impact of legal or other
proceedings against the Group or other companies in the
communications industry; and changes in statutory tax rates and
profit mix, including the disposals of Vodafone Spain and Vodafone
Italy.
A review of the reasons why
actual results and developments may differ materially from the
expectations disclosed or implied within forward-looking statements
can be found in the summary of our principal risks in the Group's
Annual Report for the year ended 31 March 2023 and half-year
results for the six months ended 30 September 2023. The Annual
Report and half-year results can be found on the Vodafone Group's
website (http://investors.vodafone.com/reports-information).
All subsequent written or oral forward-looking statements
attributable to Vodafone or any member of the Vodafone Group or any
persons acting on their behalf are expressly qualified in their
entirety by the factors referred to above. No assurances can be
given that the forward-looking statements in this document will be
realised. Subject to compliance with applicable law and
regulations, Vodafone does not intend to update these
forward-looking statements and does not undertake any obligation to
do so.
Copyright © Vodafone Group 2024
-End-
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorised.
|
VODAFONE
GROUP
|
|
PUBLIC
LIMITED COMPANY
|
|
(Registrant)
|
|
|
|
|
Date:
May 14, 2024
|
By: /s/ M D B
|
|
Name: Maaike de Bie
|
|
Title: Group General Counsel and Company Secretary
|
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