Vodafone Group claims ‘good financial performance’ for FY20

12 May 2020

UK-based telecoms giant Vodafone Group has published its results for the twelve months ended 31 March 2020, highlighting what it termed the company’s ‘good financial performance with growth in revenue, adjusted EBITDA and free cash flow’. For the year under review Vodafone generated consolidated turnover of EUR44.9 billion (USD48.7 billion), up 3.0% from the EUR43.7 billion it reported a year earlier, with growth attributed to an ‘underlying improvement in commercial performance and the contribution from the acquired Liberty Global assets, which were consolidated from August 2019, partially offset by the disposal of Vodafone New Zealand’. Organic service revenue, meanwhile, increased by 0.8% year-on-year to EUR37.9 billion, with the company citing ‘improved commercial performance across all major markets’.

Vodafone reported an adjusted EBITDA of EUR14.9 billion for its latest fiscal year, representing a 2.6% y-o-y increase, with the improvement attributed in part to the success of the company’s cost transformation agenda. Free cash flow (pre-spectrum) increased by 4.7%, to EUR5.7 billion. Although the company recorded a EUR455 million loss in FY 2020, this marked an improvement on the EUR7.6 billion loss reported in FY 2019. Further, the group noted that the most recent figure includes the profit on the disposals of Vodafone New Zealand and Vodafone Malta (EUR1.2 billion combined) and a one-time gain of EUR3.4 billion on the formation of the Italian tower operator joint venture INWIT, which was offset by its share of losses related to Vodafone Idea (EUR2.5 billion), impairments totalling EUR1.7 billion in Spain, Ireland, Romania and Automotive, and ‘mark-to-market losses of EUR1.1 billion’.

With regards to this coming fiscal year, the UK-based giant said that the economic impact of the COVID-19 pandemic in its markets ‘is likely to be significant’. Specifically, it said it is experiencing a direct impact on its roaming revenues from lower international travel, while it also expects economic pressures to impact its customer revenues over time. However, Vodafone did claim to be seeing ‘significant increases in data volumes and further improvements in loyalty’. As a result of the pandemic, the carrier has opted not to provide adjusted EBITDA guidance for FY 2021, although it noted that – based on the current prevailing assessments of the global macroeconomic outlook – it expects it to be ‘flat to slightly down’, compared to a rebased FY 2020 baseline of EUR14.5 billion.

In operational terms, Vodafone reported a group-wide mobile subscriber base of 266.627 million as at 31 March 2020, down from 273.341 million a year earlier, though fixed broadband and voice accesses continued to rise, reaching 23.519 million (Mar-19: 17.370 million) and 19.943 million (Mar-19: 15.397 million), respectively. Pay-TV subscriber numbers also maintained a growth trend, reaching 18.283 million at the end of the reporting period, up from 9.763 million at 31 March 2019.

United Kingdom, Vodafone Group