Vodafone full year results in line with expectations; plans to accelerate cost-cutting programme

19 May 2009

UK-based mobile group Vodafone has announced its financial results for the year ended 31 March 2009, revealing a 15.6% increase in revenue to GBP41 billion (USD70.6 billion), in line with expectations. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 10% year-on-year to GBP14.5 billion, while adjusted operating profit was GBP11.8 billion, a 16.7% y-o-y increase; again both results were in line with the company’s forecasts. Commenting on the results Vittorio Colao, Vodafone’s CEO, noted: ‘These results demonstrate the impact of the early actions we took to address the current economic conditions and highlight the benefits of our geographic diversity. Our GBP1 billion cost reduction programme is ahead of plan and we continue to explore further ways to reduce cost.’

In November 2008 the company said it planned to cut GBP1 billion in costs in a bid to maintain profit and boost fresh cash flow, and following the release of the 2008-09 fiscal results the company noted it would accelerate these plans. Vodafone aims to achieve more than 65% of its intended cuts in the 2009-10 financial year, after full-year impairment charges in 2008-09 rose to GBP5.9 billion, the majority of which related to the group’s Spanish operations.

Vodafone has also issued guidance for the 2009-10 financial year, announcing that it expects adjusted operating profit between GBP11 billion and GBP11.8 billion, while it expects free cash flow of GBP6-6.5 billion. Capital expenditure is expected to remain static, and while the company noted that it expects voice and messaging revenue trends to continue as a result of ongoing pricing pressures and slowing usage, it did not provide a revenue forecast.

The group also reported a 77.5% increase in total subscribers, reaching a total of 264.2 million at end-March 2009, up from 229.7 million the year before.

United Kingdom, Vodafone Group