Vodafone Group reports ‘relatively resilient’ Q1 organic service revenues

24 Jul 2020

Vodafone Group has issued a trading update for the quarter ended 30 June 2020, reporting ‘relatively resilient’ organic service revenues totalling EUR9.110 billion (USD10.6 billion), up from EUR8.994 billion in the year-ago period, but noted that the COVID-19 pandemic had ‘impacted sequential organic service revenue growth due to lower revenue from roaming and visitors, project delays and lower automotive activity in Business, and lower pre-paid revenue in some smaller markets’. ‘European’ service revenues amounted to EUR7.227 billion in 1Q21, up from EUR6.782 billion in the corresponding quarter a year earlier, while service revenues from ‘Vodacom’ and ‘Other Markets’ totalled EUR950 million (1Q20: EUR1.078 billion) and EUR840 million (EUR1.036 billion), respectively. Total turnover, meanwhile, was EUR10.506 billion for the quarter, compared to EUR10.653 billion in 1Q20.

The UK-based carrier said it remains on track to deliver at least EUR400 million net opex reduction in Europe in FY21 (31 March 20201), while it noted that its adjusted EBTIDA outlook – ‘flat to slightly down’ – remained unchanged. Further, it reiterated its full-year guidance for ‘at least’ EUR5.0 billion of free cash flow.

In terms of operational metrics, Vodafone Group reported a total mobile subscriber base of 261.344 million as of 30 June 2020, down from 273.341 million a year earlier, although it highlighted an increase in European post-paid accesses – which rose to 64.5 million in 1Q21, up from 63.3 million in 1Q20. Meanwhile, bolstered by the acquisition of Liberty Global’s assets in Germany, Hungary, Romania and the Czech Republic in mid-2019, the group’s total fixed broadband base had increased to 23.830 million at end-June 2020, representing a more than 36% year-on-year increase. Similarly, fixed voice and pay-TV customer numbers rose to 20.061 million (1Q20: 15.579 million) and 18.308 million (1Q20: 9.731 million), respectively.

Commenting, Vodafone Group’s chief executive Nick Read said: ‘Our trading performance in the first quarter demonstrates the relative resilience of our operating model and focused delivery of our strategic priorities. Whilst we have seen the direct impact on our revenue from travel restrictions and business project delays, we have also seen increased usage in voice and data, alongside record NGN broadband customer net additions in Europe.’

United Kingdom, Vodafone Group