On Tuesday, Vodafone confirmed an upsurge in its organic earnings by 2.2% for 2024, a figure in alignment with market anticipations, following its resurgence to gross growth in the concluding quarter. This surge can be accredited partially to advancements made within the UK, Germany and Ireland.
In Ireland, Vodafone disclosed an augmentation in its service revenue due primarily to “a bolstered average customer base” and yearly contract price escalations. These inflationary actions have imposed a 3% augmementation above the consumer price index onto customers throughout their contract tenure. Over the period, an additional 30,000 mobile contract customers were added.
Vodafone’s most sizeable market belongs to Germany. The company’s CEO, Margherita Della Valle, highlighted that consistent growth was being achieved across all European markets, an outcome attributed to her choice to offload the underperforming operations in Spain and Italy. Positive growth was also reported across Africa.
Share prices in Vodafone, which have depreciated by 22% over the past year, saw an uptick of 3.5% in initial dealings, reaching 72.5 pence.
The British telecom giant reported core earnings of €11.02 billion, which met forecasts, and adjusted free cash flow earnings of €2.6 billion. The latter surpassed market projections of €2.44 billion for the year leading to the close of March.
In March, when the deal with Italy was confirmed, Vodafone asserted it would cut its dividend by half to 4.5 cents per share, for the year set to commence in April. This reflected the reduced cash flow resulting from a decreased operational scale, and the assignment of €4 billion towards share buybacks.
On Tuesday, the company forecasted its core earnings for the current year to hover around €11 billion, a figure generally stable, whilst free cash flow would be at least €2.4 billion. This is a figure slightly superior to the current market predictions.
In Germany, the company saw a rebound with service revenue-up by 0.2% for the complete year and 0.6% for the concluding quarter. However, adjusted core earnings were down by 5.8% due to elevated energy and other inflation-incurred expenses.
According to CEO Della Vale, much improvement is necessary in the forthcoming year. She added that the focus would be on boosting investment into customer experience, amplifying performance in Germany, hastening momentum in Business, whilst maintaining operational simplicity. – Reuters
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