Vodafone Sets New EUR1 Billion Costs-Saving Target as Macroeconomic Environment Worsens -- Update
By Kyle Morris
Vodafone Group PLC on Tuesday reported a rise in pretax profit
and revenue for the first half of fiscal 2023, but updated its
guidance for the full year amid the challenging macroeconomic
environment and set a new costs-savings target of more than 1
billion euros ($1.03 billion).
Chief Executive Nick Read said the company is taking a number of
steps to mitigate the economic backdrop of high energy costs and
rising inflation, including pricing action in Europe.
The U.K.-based telecommunications company said pretax profit for
the six months to Sept. 30 was 1.73 billion euros ($1.79 billion)
compared with EUR1.28 billion a year prior.
Adjusted earnings before interest, taxes, depreciation and
amortization--which strips out exceptional and other one-off
items--was EUR7.24 billion from EUR7.57 billion, down 2.6% on an
organic basis. The drop was driven by a material prior-year legal
settlement and commercial underperformance in Germany, it said.
Revenue for the first half was EUR22.93 billion compared with
In Germany, total revenue increased 2.2% to EUR6.6 billion,
driven by equipment sales, but adjusted Ebitda declined 7.4%,
reflecting a fall in service revenue, one-off settlements in the
year-prior period and higher customer acquisition costs. On an
organic basis, service revenue declined 0.8%, primarily reflecting
broadband losses related to the implementation of new sector
legislation. Fixed service revenue declined 1.6% and the cable
broadband customer base decreased 45,000. The TV customer base fell
The company updated its guidance for fiscal 2023 as the global
macroeconomic climate has worsened, with energy costs and inflation
hitting performance. Vodafone sees adjusted Ebitda of EUR15.0
billion-EUR15.2 billion, from EUR15.0 billion-EUR15.5 billion
previously. Adjusted free cash flow is now seen at around EUR5.1
billion, from around EUR5.3 billion.
The board declared an interim dividend of 4.50 European cents
for the period, flat on year.
"In the context of a challenging macroeconomic environment, we
are delivering a resilient performance this year, alongside making
good progress with our operational and portfolio priorities," Mr.
The company's Vantage Towers transaction helped to deliver
monetization and deconsolidation whilst retaining co-control of the
strategically important assets, he added.
On Nov. 9, it said that it had agreed to form a new
jointly-owned company with Global Infrastructure Partners LLC and
KKR & Co. that will own its 81.7% stake in Vantage Towers
Write to Kyle Morris at email@example.com
(END) Dow Jones Newswires
November 15, 2022 03:13 ET (08:13 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.
Historical Stock Chart
Von Jan 2023 bis Feb 2023
Historical Stock Chart
Von Feb 2022 bis Feb 2023