Form 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rules 13a-16 or
15d-16 of
the Securities Exchange Act of 1934
Dated November 14, 2007
VODAFONE GROUP
PUBLIC LIMITED COMPANY
(Exact name of registrant as specified in its charter)
VODAFONE HOUSE, THE CONNECTION, NEWBURY, BERKSHIRE, RG14 2FN, ENGLAND
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F.
Form 20-F |
ü |
Form 40-F |
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Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
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Yes |
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No |
ü |
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If Yes is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
This Report on Form 6-K contains a news release issued by Vodafone Group Plc on, November 13 2007, entitled HALF-YEARLY FINANCIAL REPORT FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007.
VODAFONE GROUP PLC |
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Embargo: |
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Not for publication |
HALF-YEARLY FINANCIAL REPORT FOR |
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before 07:00 hours |
THE SIX MONTHS ENDED 30 SEPTEMBER 2007 |
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13 November 2007 |
Key highlights(1):
Group revenue of £17.0 billion, an increase of 9.0%, with organic growth of 4.4%
Europe: 2.0% revenue growth with outgoing usage up 24.0%, messaging revenue up 8.6% and data revenue up 40.8%, all on an organic basis
EMAPA: revenue growth of 39.9%, reflecting acquisitions in India and Turkey. Organic growth of 16.0%
Group data revenue up 48.8% to £1.0 billion, with organic growth of 45.1%
Group adjusted operating profit increased 1.6% to £5.2 billion, with organic growth of 6.1%
Free cash flow from continuing operations of £2.7 billion, reflecting 8.1% mobile capital intensity for Europe(2)
Adjusted basic earnings per share increased by 7.4% to 6.42 pence. Basic earnings per share of 6.22 pence
Proportionate mobile customer base of 241 million at 30 September
Results reflect rigorous execution against the Groups five strategic objectives
Increasing returns to shareholders:
Interim dividend per share increased by 6.0% to 2.49 pence, giving a payout of over £1.3 billion
Improved outlook:
Increased outlook for revenue, adjusted operating profit and free cash flow for the 2008 financial year
(1) See page 4 for Group financial and operational highlights, page 35 for definition of terms and page 37 for use of non-GAAP financial information. See page 5 for the Outlook for the 2008 financial year
(2) Includes common functions
Arun Sarin, Chief Executive, commented:
These results reflect our continuing focus on the execution of our strategy. In Europe, we have performed well in competitive markets by driving strong growth in voice usage and data revenue, whilst improving cost efficiency. In EMAPA, we are capturing the revenue growth opportunities within emerging markets and benefiting from continuing momentum at Verizon Wireless. The increased interim dividend reflects the Boards confidence in how the business is progressing.
CHIEF EXECUTIVES STATEMENT
Rigorous execution against our strategic objectives has been key to our performance in the first half of the year. We have improved our outlook expectations for the full year and the Board has increased the interim dividend by 6.0% to 2.49 pence per share, enhancing returns to our shareholders.
Group revenue increased by 9.0% to £17.0 billion, or 4.4% on an organic basis. In Europe, where competitive and regulatory pressures remain significant, organic revenue growth was 2.0%. Good revenue growth in Spain and the UK was offset by declines in Germany and Italy, where specific competitive and regulatory events have detracted from an otherwise solid business performance. EMAPA delivered another period of continued growth. Revenue grew by 39.9%, or 16.0% on an organic basis, with strong performances across the region. Group adjusted operating profit increased by 1.6% to £5.2 billion, or 6.1% on an organic basis, including an increased contribution from Verizon Wireless which grew by 26.0% on a constant currency basis.
Adjusted earnings per share increased by 7.4% to 6.42 pence due to the year on year benefit from the share consolidation in July last year.
Our customer franchise increased by 35 million in the period to 241 million proportionate mobile customers, including 20 million net additions.
Capital expenditure in the first half was £2.0 billion, including £0.4 billion in India since its acquisition in May. Free cash flow generation remains strong at £2.7 billion, after £0.2 billion payments in respect of long standing tax issues.
Revenue stimulation and cost reduction in Europe
In Europe, our focus is to drive additional usage and revenue from core voice and messaging services and to reduce our cost base.
Central to stimulating revenue have been our initiatives to drive mobile usage through offering innovative tariffs, larger minute bundles and targeted promotions. There has also been a specific focus on migrating prepaid customers to contract, thereby improving customer lifetime value. Overall growth in outgoing voice usage remained strong at 24.0% for the first half, but continued pricing pressure resulted in stable outgoing voice revenue. Notwithstanding our efforts in revenue stimulation, elasticity remains below one. In the business segment, which represents approximately 28% of European service revenue and delivered 5.9% growth in the first half, we are leveraging our market leading position. Earlier this year, we established Vodafone Global Enterprise which is responsible for ensuring that we deliver enhanced service and our total communications offering to our largest multinational customers.
16 million customers now enjoy lower roaming pricing through Vodafone Passport. All of our European customers are now benefiting from our commitment to reduce roaming prices and the recently introduced roaming regulation.
Messaging revenue remains robust with 8.6% organic growth, including strong performances in Italy and the UK, driven primarily by targeted promotions and tariffs.
Cost reduction remains central to our Group and a number of core cost reduction programmes are now well established. They are delivering savings across the Group and have helped to mitigate pressure on EBITDA margins and reduce our European mobile and common functions capital expenditure to revenue ratio to 8.1% in the first half, below our full year target which remains at 10%. Data centre consolidation and network supply chain management centralisation are delivering savings earlier than originally expected.
Innovate and deliver on our customers total communications needs
Our focus is on four key areas which together are expected to represent around 20% of Group revenue by the 2010 financial year. In the first half, these areas contributed about 12% of revenue, up from around 10% in the prior year.
Data revenue increased by 45.1% on an organic basis, principally enabled by the rapid growth in 3G devices, which nearly doubled year on year to over 21 million devices. We have also refreshed our consumer mobile internet offering in eight markets, supported by partnerships with leading internet players, and are continuing to develop products and services to integrate the mobile and PC environments.
Following completion of the acquisition of Tele2s fixed broadband businesses in Italy and Spain we will have established our preferred route for delivering fixed broadband services in each of our major European markets through a selective approach of wholesale agreements and owned infrastructure. Including Tele2, fixed broadband services will be provided to 3.1 million customers in 13 markets. Revenue from fixed line services increased by 9.9% on an organic basis, primarily due to 9.6% constant currency growth in Arcor.
We continue to drive substitution of fixed line usage for mobile through fixed location pricing plans offering customers fixed prices when they call from within or around their home or office. We now have 3.7 million Vodafone At Home customers and 2.6 million Vodafone Office customers.
2
We believe mobile advertising is a significant future opportunity for the mobile industry. We have commercial agreements for mobile advertising in eight markets and are trialling numerous forms of banner and content based advertising. Vodafone is in a leading position to benefit from future trends in this market.
Deliver strong growth in emerging markets
Our focus is to build on our track record of creating value in emerging markets. We have delivered further good performances in our existing operations with revenue growth of 33.1% in Egypt, 24.0% in Romania and 19.6% in Vodacom on a constant currency basis. Turkey continues to perform well with year on year revenue growth of around 28% on the same basis.
Our Indian business is delivering very strong growth. Average net customer additions are running at 1.6 million per month, with a customer base of over 35 million at the end of September. Year on year revenue growth was around 53% on a constant currency basis. In September, we successfully rebranded the business to Vodafone, an important integration milestone, ahead of plan.
As well as driving customer growth, we are differentiating Vodafone in emerging markets through a number of initiatives. Our ultra low cost handset, which retails for as little as $25, enables us to address a wider population in developing economies. In October, our first month of sales, we sold 400,000 units in India. M-PESA, our innovative money transfer solution was launched in February 2007 and is already benefiting over one million people in Kenya. Efficiency is also vital to success in emerging markets, where low market prices require the lowest possible costs.
Actively manage our portfolio to maximise returns
We completed the acquisition of Vodafone Essar in India in May 2007 for a cash consideration of £5.5 billion. In July, we received £0.7 billion from the sale of a 4.99% stake in Bharti Airtel and have agreed the sale of a further 0.61% by November 2008. The acquisitions of Tele2 Italy and Tele2 Spain for £0.5 billion will strengthen our total communications offerings in those markets.
Align capital structure and shareholder returns policy to strategy
We continue to target a low single A rating, consistent with our policy.
The Board remains committed to its policy of distributing 60% of adjusted earnings per share by way of dividend. However, as a result of the earnings dilution arising from the India acquisition, the payout ratio is expected to rise above 60% in the near term to better reflect the underlying trends of the business.
In growing dividends at 6.0%, ahead of its guidance for modest growth issued in May, the Board has taken into account the Groups current financial performance and its confidence in the prospects for the business.
Prospects for the remainder of the year
Notwithstanding 40.8% organic growth in data revenue and our success in stimulating voice usage, we expect market conditions and the pricing environment to remain competitive in Europe. Growth prospects for the EMAPA region remain strong as we actively pursue customer growth in markets where penetration is still increasing.
Our success in the first half and continued rigorous execution of our strategy has allowed us to improve our outlook for the current financial year. Group revenue is now expected to be in the increased range of £34.5 billion to £35.1 billion, primarily due to improved operational performance. Adjusted operating profit is also expected to be higher at £9.5 billion to £9.9 billion, reflecting better revenue generation. Capital expenditure on fixed assets is still expected to be in the range of £4.7 billion to £5.1 billion, including in excess of £1.0 billion in India. Free cash flow is now expected to be £4.4 billion to £4.9 billion, better than previously expected due to better business performance and lower payments this year related to long standing tax issues.
Summary
We are delivering tangible results from our strategy which positions us well to deliver total communications to our customers and to generate attractive returns for our shareholders.
Arun Sarin
3
GROUP FINANCIAL AND OPERATING HIGHLIGHTS
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2007 |
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2006 |
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Change % |
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Continuing operations(1)(2)(3) |
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Page |
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£m |
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£m |
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Reported |
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Organic |
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Financial information |
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Revenue |
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21 |
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16,994 |
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15,594 |
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9.0 |
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4.4 |
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Operating loss |
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21 |
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5,208 |
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(2,952 |
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Profit/(loss) before taxation |
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21 |
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4,560 |
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(3,330 |
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Profit/(loss) for the period |
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21 |
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3,327 |
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(4,548 |
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Basic earnings/(loss) per share (pence) |
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21 |
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6.22p |
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(8.02)p |
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Capitalised fixed asset additions |
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1,982 |
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1,824 |
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8.7 |
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Net cash flow from operating activities |
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17 |
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4,860 |
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4,840 |
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0.4 |
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Performance reporting(1)(2)(3)(4) |
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Group EBITDA |
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6 |
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6,565 |
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6,242 |
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5.2 |
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2.4 |
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Adjusted operating profit |
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6, 40 |
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5,223 |
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5,141 |
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1.6 |
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6.1 |
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Adjusted profit before tax |
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8, 40 |
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4,701 |
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4,724 |
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(0.5 |
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Adjusted effective tax rate |
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8 |
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30.1% |
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29.2% |
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Adjusted profit for the period attributable to equity shareholders |
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8, 40 |
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3,397 |
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3,441 |
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(1.3 |
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Adjusted basic earnings per share (pence) |
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40 |
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6.42p |
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5.98p |
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7.4 |
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Free cash flow |
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17 |
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2,661 |
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2,955 |
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(9.9 |
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Net debt |
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17 |
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23,253 |
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20,229 |
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14.9 |
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2007 |
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2006 |
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Change % |
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Continuing operations(1)(2)(3) |
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Page |
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Million |
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Million |
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Reported |
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Organic |
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Operational |
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Data revenue (£) |
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6 |
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967 |
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650 |
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48.8 |
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45.1 |
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3G registered devices |
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43 |
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21.4 |
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11.1 |
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Mobile voice usage (minutes) |
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44 |
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198,252 |
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115,143 |
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Proportionate mobile customer net additions |
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42 |
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20.5 |
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11.5 |
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Proportionate mobile customers |
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42 |
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241.5 |
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191.6 |
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This half-yearly financial report contains certain information on the Groups results and cash flows that have been derived from amounts calculated in accordance with IFRS but are not themselves IFRS measures. They should not be viewed in isolation as alternatives to the equivalent IFRS measure and should be read in conjunction with the equivalent IFRS measure. Further disclosures are provided under Use of non-GAAP financial information on page 37. |
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Notes:
(1) See page 35 for definition of terms.
(2) The results for the six months ended 30 September 2006 exclude the results of the discontinued operations in Japan and include the results of the Groups associated undertaking in Belgium and Switzerland until the announcement of their respective disposal in August 2006 and December 2006.
(3) Amounts presented as at 30 September or for the six months then ended.
(4) Where applicable, these measures are stated excluding non-operating income of associates, impairment losses and other income and expense, changes in the fair value of equity put rights and similar arrangements (see note 2 in investing income and financial costs on page 7) and certain foreign exchange differences. See page 37 for use of non-GAAP financial information.
4
OUTLOOK FOR THE 2008 FINANCIAL YEAR
Please see page 35 for definition of terms, page 36 for forward-looking statements and page 37 for use of non-GAAP financial information.
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Original |
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Foreign exchange(2) |
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Acquisitions(3) |
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Upgrade |
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Updated outlook |
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£ billion |
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£ billion |
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£ billion |
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£ billion |
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£ billion |
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Revenue |
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33.3 to 34.1 |
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0.3 |
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0.2 |
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0.6 |
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34.5 to 35.1 |
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Adjusted operating profit |
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9.3 to 9.8 |
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(0.1 |
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0.2 |
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9.5 to 9.9 |
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Capitalised fixed asset additions |
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4.7 to 5.1 |
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4.7 to 5.1 |
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Free cash flow |
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4.0 to 4.5 |
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0.1 |
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0.3 |
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4.4 to 4.9 |
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Notes: (1) As originally stated on 29 May 2007. (2) The Groups outlook update reflects current expectations for average foreign exchange rates for the 2008 financial year of approximately Euro 1.45:£1 (originally 1.47) and US$2.04:£1 (originally 1.98). A substantial majority of the Groups revenue, adjusted operating profit, capitalised fixed asset additions and free cash flow is denominated in currencies other than sterling, the Groups reporting currency. (3) Assumes the financial results of Tele2 Italy and Tele2 Spain will be included with effect from 1 December 2007. |
Operating conditions are expected to continue to be competitive in Europe with ongoing pricing and regulatory pressures but continued positive trends in data revenue and voice usage. Increasing market penetration continues to result in overall strong growth for the EMAPA region.
Group revenue is now expected to be in the range of £34.5 billion to £35.1 billion, higher than previously anticipated primarily due to improvements in operational performance but also due to net beneficial movements in foreign exchange rates and revenue for Tele2 Italy and Tele2 Spain from the expected date of acquisition.
Adjusted operating profit is now expected to be in the range of £9.5 billion to £9.9 billion, which is greater than previous expectations, driven substantially by better revenue generation. Whilst Group EBITDA margin is still expected to be lower year on year, the Group continues to expect mobile operating expenses to be broadly stable for the total of the Europe region and common functions when compared with the 2006 financial year on an organic basis, excluding the potential impact from developing and delivering new services and from any business restructuring costs.
Total depreciation and amortisation charges are now anticipated to be slightly higher at around £5.9 billion to £6.0 billion, including the impact from the Tele2 acquisitions.
The outlook range for capitalised fixed asset additions remains unchanged at £4.7 billion to £5.1 billion and continues to include in excess of £1.0 billion in India. Capitalised mobile fixed asset additions for the total of the Europe region and common functions are still expected to be 10% of mobile revenue for the year.
Free cash flow is expected to be in the range of £4.4 billion to £4.9 billion, higher than originally expected principally due to improvements in operational performance and lower anticipated tax payments and associated interest this year in respect of the potential settlement of a number of long standing tax issues, which are now expected to be £0.3 billion. The outlook for free cash flow is stated including the impact of known spectrum or licence payments only.
The Group still expects that further significant cash payments for tax and associated interest may be made in respect of long standing tax issues. Whilst the timing of such payments remains uncertain, the Group now expects resolution of the most significant issues, principally the application of the UK Controlled Foreign Company legislation to the Group, to be later than previously anticipated.
The adjusted effective tax rate percentage is expected to be similar to the 2007 financial year rate of 30.5%, which is slightly lower than previously anticipated. The Groups longer term expectation for the adjusted tax rate remains in the low 30s.
5
CONTENTS
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Page |
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Financial results |
6 |
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Liquidity and capital resources |
17 |
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Significant transactions |
19 |
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Risk factors |
19 |
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Subsequent events |
20 |
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Responsibility statement |
20 |
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Condensed consolidated financial statements |
21 |
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Other information |
35 |
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Use of non-GAAP financial information |
37 |
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Additional investor information and key performance indicators |
38 |
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GROUP RESULTS
The following results are presented for continuing operations. Europe includes the results of the Groups operations in Western Europe, while EMAPA includes the results of the Groups operations in Eastern Europe, the Middle East, Africa, Asia and the Pacific area and the Groups associate in the US, Verizon Wireless. During the six months ended 30 September 2007, the Group changed its organisation structure and the Groups associated undertaking in France, SFR, is now managed within the Europe region and reported within Other Europe. The results for all periods are presented in accordance with the new structure.
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Europe |
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EMAPA |
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Common Functions(2) |
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Eliminations |
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2007 |
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2006 |
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% change |
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||
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£m |
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£m |
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£m |
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£m |
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£m |
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£m |
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£ |
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Organic |
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Voice revenue(1) |
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8,704 |
|
3,499 |
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(43 |
) |
12,160 |
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11,317 |
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|
Messaging revenue |
|
1,575 |
|
377 |
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|
|
(4 |
) |
1,948 |
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1,786 |
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|
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Data revenue |
|
843 |
|
127 |
|
|
|
(3 |
) |
967 |
|
650 |
|
|
|
|
|
Fixed line revenue(1) |
|
780 |
|
22 |
|
|
|
|
|
802 |
|
770 |
|
|
|
|
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Other service revenue |
|
11 |
|
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(1 |
) |
10 |
|
|
|
|
|
|
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Total service revenue |
|
11,913 |
|
4,025 |
|
|
|
(51 |
) |
15,887 |
|
14,523 |
|
9.4 |
|
4.6 |
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Acquisition revenue |
|
463 |
|
211 |
|
|
|
|
|
674 |
|
642 |
|
|
|
|
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Retention revenue |
|
165 |
|
14 |
|
|
|
|
|
179 |
|
182 |
|
|
|
|
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Other revenue |
|
128 |
|
51 |
|
80 |
|
(5 |
) |
254 |
|
247 |
|
|
|
|
|
Total revenue |
|
12,669 |
|
4,301 |
|
80 |
|
(56 |
) |
16,994 |
|
15,594 |
|
9.0 |
|
4.4 |
|
Interconnect costs |
|
(1,958 |
) |
(650 |
) |
|
|
51 |
|
(2,557 |
) |
(2,354 |
) |
|
|
|
|
Other direct costs |
|
(975 |
) |
(610 |
) |
58 |
|
|
|
(1,527 |
) |
(1,247 |
) |
|
|
|
|
Acquisition costs |
|
(1,314 |
) |
(443 |
) |
|
|
|
|
(1,757 |
) |
(1,556 |
) |
|
|
|
|
Retention costs |
|
(824 |
) |
(120 |
) |
|
|
|
|
(944 |
) |
(854 |
) |
|
|
|
|
Operating expenses |
|
(2,764 |
) |
(1,050 |
) |
165 |
|
5 |
|
(3,644 |
) |
(3,341 |
) |
|
|
|
|
EBITDA |
|
4,834 |
|
1,428 |
|
303 |
|
|
|
6,565 |
|
6,242 |
|
5.2 |
|
2.4 |
|
Acquired intangibles amortisation |
|
(15 |
) |
(312 |
) |
|
|
|
|
(327 |
) |
(197 |
) |
|
|
|
|
Purchased licence amortisation |
|
(413 |
) |
(36 |
) |
|
|
|
|
(449 |
) |
(467 |
) |
|
|
|
|
Depreciation and other amortisation |
|
(1,398 |
) |
(517 |
) |
(94) |
|
|
|
(2,009 |
) |
(1,844 |
) |
|
|
|
|
Share of result in associates |
|
261 |
|
1,181 |
|
1 |
|
|
|
1,443 |
|
1,407 |
|
|
|
|
|
Adjusted operating profit |
|
3,269 |
|
1,744 |
|
210 |
|
|
|
5,223 |
|
5,141 |
|
1.6 |
|
6.1 |
|
Adjustments for: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment losses |
|
|
|
|
|
|
|
|
|
|
|
(8,100 |
) |
|
|
|
|
Other |
|
|
|
(15 |
) |
|
|
|
|
(15 |
) |
1 |
|
|
|
|
|
Non-operating income of associates |
|
|
|
|
|
|
|
|
|
|
|
6 |
|
|
|
|
|
Operating profit/(loss) |
|
3,269 |
|
1,729 |
|
210 |
|
|
|
5,208 |
|
(2,952 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes:
(1) Revenue relating to fixed line activities provided by mobile operators, previously classified within voice revenue, is now presented as fixed line revenue, together with revenue from fixed line operators and DSL. All prior periods have been adjusted accordingly.
(2) Common functions represents the results of Partner Markets and the net result of unallocated central Group costs and recharges to the Groups operations, including royalty fees for use of the Vodafone brand.
Revenue
Revenue increased by 9.0% to £16,994 million for the six months ended 30 September 2007, comprising organic growth of 4.4% and the impact of acquisitions and disposals of 5.4%, primarily from acquisitions of subsidiaries in India in May 2007 and Turkey in May 2006, partially offset by the impact of unfavourable movements in exchange rates of 0.8%.
Both the Europe and EMAPA regions increased total revenue on an organic basis, achieving growth of 2.0% and 16.0%, respectively. On a reported basis, Europe achieved growth of 1.5%, while EMAPA achieved growth of 39.9%, of which
6
26.5% was contributed by the impact of acquisitions and disposals, including the acquisition of subsidiaries in India and Turkey.
The organic growth in revenue was driven by a continued increase in the customer base and successful usage stimulation initiatives, despite persisting price pressures. The organic growth in data revenue of 45.1% was particularly strong and can be attributed in part to increasing penetration of Vodafone Mobile Connect 3G/GPRS data cards and handheld business devices.
Operating result
Operating profit increased to £5,208 million from a loss of £2,952 million in the prior year, mainly as a result of impairment charges not being incurred in the current year. Adjusted operating profit increased by 1.6% to £5,223 million, or by 6.1% on an organic basis. Foreign exchange rate movements, particularly in relation to Verizon Wireless and Vodacom, the Groups 50% owned joint venture with principal operations in South Africa, and the net impact of acquisitions and disposals reduced reported growth by 2.6% and 1.9% respectively, with the latter primarily being due to the increase in amortisation of acquired intangible assets. Adjusted operating profit is stated after £327 million of acquired intangible asset amortisation, an increase of £130 million from the same period last year.
The EMAPA regions strong growth was partly offset by a slight decline in profitability in the Europe region resulting from the continuing challenges of highly penetrated markets, termination rate cuts and a high level of competition.
The EBITDA margin in Europe was 38.2% compared to 39.5% in the same period last year, reflecting higher costs, in particular increased interconnect costs, other direct costs and acquisition costs resulting from the competitive environment in the region.
In the EMAPA region, the EBITDA margin declined to 33.2% from 35.8% for the same period last year, in part due to higher growth in the region through investment in customer base growth, and in part due to the inclusion for the whole of the current period of Turkey, which has a lower EBITDA margin than the regions average. In addition, the EBITDA margin in Turkey decreased due to investment in the rebranding of the business to Vodafone, improving network quality and growing the customer base.
The Groups share of results from associates grew by 2.6%, or by 18.2% on an organic basis, with the impact of the disposals of the Groups interests in Belgacom Mobile SA and Swisscom Mobile AG during the prior financial year, and unfavourable foreign exchange movements, reducing reported growth by 9.0% and 6.6% respectively. The organic growth was driven by strong growth in Verizon Wireless.
Investment income and financing costs
|
|
Six months to |
|
|
Six months to |
|
Investment income |
|
382 |
|
|
425 |
|
Financing costs |
|
(1,280 |
) |
|
(813 |
) |
|
|
(898 |
) |
|
(388 |
) |
|
|
|
|
|
|
|
Analysed as: |
|
|
|
|
|
|
Net financing costs before dividends from investments |
|
(394 |
) |
|
(272 |
) |
Potential interest charges arising on settlement of outstanding tax issues |
|
(200 |
) |
|
(202 |
) |
Dividends from investments |
|
72 |
|
|
57 |
|
|
|
(522 |
) |
|
(417 |
) |
Foreign exchange(1) |
|
(90 |
) |
|
8 |
|
Changes in fair value of equity put rights and similar arrangements(2) |
|
(286 |
) |
|
21 |
|
|
|
(898 |
) |
|
(388 |
) |
Notes:
(1) Comprises foreign exchange differences reflected in the income statement in relation to certain intercompany balances, and the foreign exchange differences on financial instruments received as consideration in the disposal of Vodafone Japan to SoftBank, which completed in April 2006.
(2) Includes a charge of £333 million representing the initial fair value of the put options granted over the Essar groups interest in Vodafone Essar, which has been recorded as an expense. Further details of these options are provided on page 19.
Net financing costs before dividends from investments increased by 44.9% to £394 million following an increase in average net debt of 28.7%, a change in the currency mix and higher interest rates. At 30 September 2007, the provision for potential interest charges arising on settlement of outstanding tax issues was £1,409 million (30 September 2006: £1,047 million).
7
Taxation
|
|
Six months to |
|
|
Six months to |
|
|
|
|
|
|
|
|
Income tax expense |
|
1,233 |
|
|
1,218 |
|
Recognition of pre-acquisition deferred tax asset |
|
15 |
|
|
- |
|
Tax on adjustments to derive adjusted profit before tax |
|
19 |
|
|
2 |
|
|
|
|
|
|
|
|
Adjusted income tax expense |
|
1,267 |
|
|
1,220 |
|
Share of associated undertakings tax |
|
222 |
|
|
240 |
|
|
|
|
|
|
|
|
Adjusted income tax expense for purposes of calculating adjusted tax rate |
|
1,489 |
|
|
1,460 |
|
|
|
|
|
|
|
|
Profit /(loss) before tax |
|
4,560 |
|
|
(3,330 |
) |
Adjustments to derive adjusted profit before tax(1) |
|
141 |
|
|
8,054 |
|
|
|
|
|
|
|
|
Adjusted profit before tax |
|
4,701 |
|
|
4,724 |
|
Add: Share of associated undertakings tax and minority interest |
|
250 |
|
|
271 |
|
|
|
|
|
|
|
|
Adjusted profit before tax for the purpose of calculating adjusted effective tax rate |
|
4,951 |
|
|
4,995 |
|
|
|
|
|
|
|
|
Adjusted effective tax rate |
|
30.1% |
|
|
29.2% |
|
Note:
(1) See earnings/(loss) per share below.
The adjusted effective tax rate for the six months ended 30 September 2007 was 30.1% compared to 29.2% for the same period last year. The effective rate, excluding impairment losses and other adjustments, for the year ending 31 March 2008 is expected to be similar to the effective rate for the year ended 31 March 2007 of 30.5%.
Earnings/(loss) per share
Adjusted earnings per share increased by 7.4% from 5.98 pence to 6.42 pence for the six months ended 30 September 2007, with the increase being primarily due to the lower weighted average number of shares following the share consolidation which occurred in July 2006 and which therefore, will not benefit the second half of the financial year. Basic earnings per share from continuing operations was 6.22 pence compared to a basic loss per share from continuing operations of 8.02 pence for the same period last year.
|
|
Six months to |
|
|
Six months to |
|
|
|
|
|
|
|
|
Profit/(loss) from continuing operations attributable to equity shareholders |
|
3,290 |
|
|
(4,611 |
) |
Adjustments: |
|
|
|
|
|
|
Impairment losses |
|
- |
|
|
8,100 |
|
Other income and expense |
|
15 |
|
|
(1 |
) |
Share of associated undertakings non-operating income |
|
- |
|
|
(6 |
) |
Non-operating income and expense(1) |
|
(250 |
) |
|
(10 |
) |
Foreign exchange(2) |
|
90 |
|
|
(8 |
) |
Changes in fair value of equity put rights and similar arrangements(3) |
|
286 |
|
|
(21 |
) |
|
|
|
|
|
|
|
|
|
141 |
|
|
8,054 |
|
Tax on the above items |
|
(19 |
) |
|
(2 |
) |
Recognition of pre-acquisition deferred tax asset |
|
(15 |
) |
|
- |
|
|
|
|
|
|
|
|
Adjusted profit from continuing operations attributable to equity shareholders |
|
3,397 |
|
|
3,441 |
|
|
|
|
|
|
|
|
Weighted average number of shares outstanding basic |
|
52,935 |
|
|
57,515 |
|
Weighted average number of shares outstanding diluted(4) |
|
53,116 |
|
|
57,515 |
|
Notes:
(1) The £250 million adjustment for the six months ended 30 September 2007 represents the profit on disposal of the Groups 5.60% stake in Bharti Airtel.
(2) See note 1 in investment income and financing costs on page 7.
(3) See note 2 in investment income and financing costs on page 7.
(4) In the six months ended 30 September 2006, 140 million shares have been excluded from the calculation of diluted loss per share as they are not dilutive.
8
EUROPE RESULTS
|
|
Germany |
|
Italy |
|
Spain |
|
UK |
|
Arcor |
|
Other |
|
|
Eliminations |
|
Europe |
|
|
% change |
|
||
|
|
£m |
|
£m |
|
£m |
|
£m |
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
Six months to 30 September 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice revenue(1) |
|
1,888 |
|
1,570 |
|
1,867 |
|
1,855 |
|
|
|
1,690 |
|
|
(166 |
) |
8,704 |
|
|
|
|
|
|
Messaging revenue |
|
354 |
|
324 |
|
205 |
|
444 |
|
|
|
265 |
|
|
(17 |
) |
1,575 |
|
|
|
|
|
|
Data revenue |
|
265 |
|
119 |
|
170 |
|
184 |
|
|
|
133 |
|
|
(28 |
) |
843 |
|
|
|
|
|
|
Fixed line revenue(1) |
|
7 |
|
10 |
|
9 |
|
12 |
|
758 |
|
16 |
|
|
(32 |
) |
780 |
|
|
|
|
|
|
Other service revenue |
|
1 |
|
2 |
|
|
|
8 |
|
|
|
|
|
|
|
|
11 |
|
|
|
|
|
|
Total service revenue |
|
2,515 |
|
2,025 |
|
2,251 |
|
2,503 |
|
758 |
|
2,104 |
|
|
(243 |
) |
11,913 |
|
|
1.7 |
|
2.3 |
|
Acquisition revenue |
|
83 |
|
58 |
|
120 |
|
127 |
|
10 |
|
67 |
|
|
(2 |
) |
463 |
|
|
|
|
|
|
Retention revenue |
|
21 |
|
12 |
|
64 |
|
21 |
|
|
|
47 |
|
|
|
|
165 |
|
|
|
|
|
|
Other revenue |
|
31 |
|
2 |
|
4 |
|
66 |
|
|
|
25 |
|
|
|
|
128 |
|
|
|
|
|
|
Total revenue |
|
2,650 |
|
2,097 |
|
2,439 |
|
2,717 |
|
768 |
|
2,243 |
|
|
(245 |
) |
12,669 |
|
|
1.5 |
|
2.0 |
|
Interconnect costs |
|
(319 |
) |
(343 |
) |
(350 |
) |
(579 |
) |
(182 |
) |
(428 |
) |
|
243 |
|
(1,958 |
) |
|
|
|
|
|
Other direct costs |
|
(145 |
) |
(99 |
) |
(186 |
) |
(243 |
) |
(164 |
) |
(138 |
) |
|
|
|
(975 |
) |
|
|
|
|
|
Acquisition costs |
|
(290 |
) |
(134 |
) |
(278 |
) |
(368 |
) |
(78 |
) |
(168 |
) |
|
2 |
|
(1,314 |
) |
|
|
|
|
|
Retention costs |
|
(202 |
) |
(52 |
) |
(238 |
) |
(177 |
) |
|
|
(155 |
) |
|
|
|
(824 |
) |
|
|
|
|
|
Operating expenses |
|
(544 |
) |
(433 |
) |
(438 |
) |
(616 |
) |
(206 |
) |
(527 |
) |
|
|
|
(2,764 |
) |
|
|
|
|
|
EBITDA |
|
1,150 |
|
1,036 |
|
949 |
|
734 |
|
138 |
|
827 |
|
|
|
|
4,834 |
|
|
(2.0 |
) |
(1.5 |
) |
Acquired intangibles amortisation |
|
|
|
|
|
|
|
(11 |
) |
|
|
(4 |
) |
|
|
|
(15 |
) |
|
|
|
|
|
Purchased licence amortisation |
|
(170 |
) |
(39 |
) |
(3 |
) |
(166 |
) |
|
|
(35 |
) |
|
|
|
(413 |
) |
|
|
|
|
|
Depreciation and other amortisation |
|
(336 |
) |
(221 |
) |
(231 |
) |
(314 |
) |
(46 |
) |
(250 |
) |
|
|
|
(1,398 |
) |
|
|
|
|
|
Share of result in associates |
|
|
|
|
|
|
|
|
|
|
|
261 |
|
|
|
|
261 |
|
|
|
|
|
|
Adjusted operating profit |
|
644 |
|
776 |
|
715 |
|
243 |
|
92 |
|
799 |
|
|
|
|
3,269 |
|
|
(2.7 |
) |
(2.3 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA margin |
|
43.4% |
|
49.4% |
|
38.9% |
|
27.0% |
|
18.0% |
|
36.9% |
|
|
|
|
38.2% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months to 30 September 2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice revenue(1) |
|
2,106 |
|
1,721 |
|
1,729 |
|
1,838 |
|
|
|
1,731 |
|
|
(205 |
) |
8,920 |
|
|
|
|
|
|
Messaging revenue |
|
386 |
|
275 |
|
190 |
|
365 |
|
|
|
256 |
|
|
(14 |
) |
1,458 |
|
|
|
|
|
|
Data revenue |
|
190 |
|
89 |
|
122 |
|
134 |
|
|
|
91 |
|
|
(23 |
) |
603 |
|
|
|
|
|
|
Fixed line revenue(1) |
|
8 |
|
11 |
|
9 |
|
8 |
|
697 |
|
12 |
|
|
(14 |
) |
731 |
|
|
|
|
|
|
Total service revenue |
|
2,690 |
|
2,096 |
|
2,050 |
|
2,345 |
|
697 |
|
2,090 |
|
|
(256 |
) |
11,712 |
|
|
|
|
|
|
Acquisition revenue |
|
71 |
|
57 |
|
153 |
|
120 |
|
9 |
|
56 |
|
|
|
|
466 |
|
|
|
|
|
|
Retention revenue |
|
17 |
|
20 |
|
62 |
|
29 |
|
|
|
46 |
|
|
|
|
174 |
|
|
|
|
|
|
Other revenue |
|
49 |
|
1 |
|
3 |
|
55 |
|
|
|
24 |
|
|
|
|
132 |
|
|
|
|
|
|
Total revenue |
|
2,827 |
|
2,174 |
|
2,268 |
|
2,549 |
|
706 |
|
2,216 |
|
|
(256 |
) |
12,484 |
|
|
|
|
|
|
Interconnect costs |
|
(363 |
) |
(326 |
) |
(349 |
) |
(489 |
) |
(172 |
) |
(437 |
) |
|
256 |
|
(1,880 |
) |
|
|
|
|
|
Other direct costs |
|
(167 |
) |
(111 |
) |
(174 |
) |
(209 |
) |
(119 |
) |
(119 |
) |
|
|
|
(899 |
) |
|
|
|
|
|
Acquisition costs |
|
(274 |
) |
(114 |
) |
(323 |
) |
(292 |
) |
(85 |
) |
(155 |
) |
|
|
|
(1,243 |
) |
|
|
|
|
|
Retention costs |
|
(182 |
) |
(62 |
) |
(183 |
) |
(186 |
) |
|
|
(150 |
) |
|
|
|
(763 |
) |
|
|
|
|
|
Operating expenses |
|
(578 |
) |
(433 |
) |
(426 |
) |
(588 |
) |
(204 |
) |
(536 |
) |
|
|
|
(2,765 |
) |
|
|
|
|
|
EBITDA |
|
1,263 |
|
1,128 |
|
813 |
|
785 |
|
126 |
|
819 |
|
|
|
|
4,934 |
|
|
|
|
|
|
Acquired intangibles amortisation |
|
|
|
|
|
|
|
(4 |
) |
|
|
(4 |
) |
|
|
|
(8 |
) |
|
|
|
|
|
Purchased licence amortisation |
|
(172 |
) |
(37 |
) |
(34 |
) |
(166 |
) |
|
|
(34 |
) |
|
|
|
(443 |
) |
|
|
|
|
|
Depreciation and other amortisation |
|
(367 |
) |
(252 |
) |
(194 |
) |
(297 |
) |
(43 |
) |
(255 |
) |
|
|
|
(1,408 |
) |
|
|
|
|
|
Share of result in associates |
|
|
|
|
|
|
|
|
|
|
|
286 |
|
|
|
|
286 |
|
|
|
|
|
|
Adjusted operating profit |
|
724 |
|
839 |
|
585 |
|
318 |
|
83 |
|
812 |
|
|
|
|
3,361 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA margin |
|
44.7% |
|
51.9% |
|
35.8% |
|
30.8% |
|
17.8% |
|
37.0% |
|
|
|
|
39.5% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
% |
|
% |
|
% |
|
% |
|
% |
|
% |
|
|
|
|
|
|
|
|
|
|
|
Change at constant exchange rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice revenue(1) |
|
(9.8 |
) |
(8.1 |
) |
8.7 |
|
0.9 |
|
|
|
(1.8 |
) |
|
|
|
|
|
|
|
|
|
|
Messaging revenue |
|
(7.7 |
) |
18.4 |
|
9.0 |
|
21.6 |
|
|
|
4.4 |
|
|
|
|
|
|
|
|
|
|
|
Data revenue |
|
40.1 |
|
35.7 |
|
41.2 |
|
37.3 |
|
|
|
49.2 |
|
|
|
|
|
|
|
|
|
|
|
Fixed line revenue(1) |
|
(2.6 |
) |
(5.5 |
) |
(2.2 |
) |
50.0 |
|
9.6 |
|
34.5 |
|
|
|
|
|
|
|
|
|
|
|
Total service revenue |
|
(5.9 |
) |
(2.7 |
) |
10.6 |
|
6.7 |
|
9.6 |
|
1.4 |
|
|
|
|
|
|
|
|
|
|
|
Acquisition revenue |
|
18.3 |
|
3.3 |
|
(21.4 |
) |
5.8 |
|
10.0 |
|
24.4 |
|
|
|
|
|
|
|
|
|
|
|
Retention revenue |
|
23.5 |
|
(42.8 |
) |
4.6 |
|
(27.6 |
) |
|
|
1.8 |
|
|
|
|
|
|
|
|
|
|
|
Other revenue |
|
(36.6 |
) |
171.4 |
|
25.8 |
|
20.0 |
|
|
|
4.9 |
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
(5.7 |
) |
(2.9 |
) |
8.3 |
|
6.6 |
|
9.6 |
|
2.0 |
|
|
|
|
|
|
|
|
|
|
|
Interconnect costs |
|
(11.5 |
) |
5.7 |
|
1.0 |
|
18.4 |
|
5.8 |
|
(1.0 |
) |
|
|
|
|
|
|
|
|
|
|
Other direct costs |
|
(12.8 |
) |
(10.1 |
) |
8.3 |
|
16.3 |
|
37.0 |
|
16.6 |
|
|
|
|
|
|
|
|
|
|
|
Acquisition costs |
|
6.5 |
|
18.5 |
|
(13.1 |
) |
26.0 |
|
(5.6 |
) |
9.5 |
|
|
|
|
|
|
|
|
|
|
|
Retention costs |
|
11.6 |
|
(15.4 |
) |
30.6 |
|
(4.8 |
) |
|
|
4.0 |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
(5.3 |
) |
0.9 |
|
3.6 |
|
4.8 |
|
1.8 |
|
(1.3 |
) |
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
(8.4 |
) |
(7.5 |
) |
17.5 |
|
(6.5 |
) |
11.0 |
|
1.8 |
|
|
|
|
|
|
|
|
|
|
|
Acquired intangibles amortisation |
|
|
|
|
|
|
|
175.0 |
|
|
|
100.0 |
|
|
|
|
|
|
|
|
|
|
|
Purchased licence amortisation |
|
|
|
5.4 |
|
(91.2 |
) |
|
|
|
|
6.1 |
|
|
|
|
|
|
|
|
|
|
|
Depreciation and other amortisation |
|
(8.2 |
) |
(11.6 |
) |
19.7 |
|
5.7 |
|
9.5 |
|
(1.6 |
) |
|
|
|
|
|
|
|
|
|
|
Share of result in associates |
|
|
|
|
|
|
|
|
|
|
|
(8.4 |
) |
|
|
|
|
|
|
|
|
|
|
Adjusted operating profit |
|
(10.5 |
) |
(6.9 |
) |
23.0 |
|
(23.6 |
) |
12.1 |
|
(1.2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA margin movement |
|
(1.3 |
) |
(2.5 |
) |
3.0 |
|
(3.8 |
) |
0.3 |
|
(0.1 |
) |
|
|
|
|
|
|
|
|
|
|
Note:
(1) Revenue relating to fixed line activities provided by mobile operators, previously classified within voice revenue, is now presented as fixed line revenue, together with revenue from fixed line operators and DSL. All prior periods have been adjusted accordingly.
9
|
|
30 September |
|
Germany |
|
Italy |
|
Spain |
|
UK |
|
Other |
|
Europe |
|
Mobile telecommunications KPIs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Closing customers (000) |
|
- 2007 |
|
32,541 |
|
22,407 |
|
15,473 |
|
17,959 |
|
17,684 |
|
106,064 |
|
|
|
- 2006 |
|
29,622 |
|
19,337 |
|
14,024 |
|
16,287 |
|
16,267 |
|
95,537 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Closing 3G devices (000) |
|
- 2007 |
|
4,745 |
|
4,700 |
|
4,328 |
|
3,095 |
|
2,873 |
|
19,741 |
|
|
|
- 2006 |
|
2,724 |
|
2,830 |
|
1,739 |
|
1,348 |
|
1,726 |
|
10,367 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice usage (millions of minutes) |
|
- 2007 |
|
20,160 |
|
17,983 |
|
17,416 |
|
18,075 |
|
15,385 |
|
89,019 |
|
|
|
- 2006 |
|
15,593 |
|
15,737 |
|
14,511 |
|
14,786 |
|
14,120 |
|
74,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See page 35 for definition of terms |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
Revenue growth of 1.5% in the six months ended 30 September 2007 was achieved despite a 0.5% impact from adverse exchange rate movements.
Service revenue growth was 1.7% in the six months ended 30 September 2007, with organic growth more than offsetting the adverse exchange rate movements. This growth was achieved predominantly by strong performance in data revenue, following improved service offerings and a significant increase in the number of 3G devices, and also from growth in the total registered mobile customer base which increased by 11.0% and reached 106.1 million at 30 September 2007. The positive impact of these factors on service revenue growth more than offset the negative effects of termination rate cuts, the cancellation of top up fees in Italy resulting from new regulation and the Groups ongoing reduction of European roaming rates.
Voice revenue declined by 2.4%, or by 1.9% on an organic basis, driven by the effect of the termination rate cuts, roaming regulation and pricing reductions, which were mostly offset by total voice usage growth of 19.1%.
Outgoing voice revenue remained broadly stable, with 0.3% organic growth during the period. Strong growth of 24.0% in outgoing call minutes, driven by the increased customer base and a 12.9% increase in outgoing usage per customer, was broadly matched by a reduction in the effective rate per minute, resulting from the cancellation of top up fees in Italy and price competition.
Incoming voice revenue continued to decline, with a 4.4% fall on an organic basis, principally due to the impact of termination rate reductions in Germany, despite a 9.2% increase in incoming mobile voice minutes in the region.
Roaming and international visitor revenue declined 7.4% on an organic basis, as expected, principally from the impact of the Groups initiatives on retail and wholesale roaming. The overall reduction in revenue was mitigated by an increase of 12.4% in the respective volume of voice minutes used during the period.
The region recorded 8.0% growth in messaging revenue, or 8.6% on an organic basis compared with the same period last year, principally as a result of strong growth in messaging usage, particularly in Italy and the UK.
Data revenue growth remained strong, increasing by 39.8%, or by 40.8% on an organic basis. Data revenue continues to benefit from growth in connectivity services, demonstrated by the increasing penetration of 3G devices, which have nearly doubled since September 2006 to 19.7 million. Handheld business devices increased by 112.6% since September last year and Vodafone Mobile Connect 3G/GPRS data cards grew by 78.9%.
Fixed line revenue increased by 6.7%, or by 7.6% on an organic basis, mainly due to a 9.6% increase in Arcors service revenue at constant exchange rates.
Germany
At constant exchange rates, service revenue declined by 5.9%, mainly resulting from a 9.8% fall in voice revenue. This decline was driven by the impact of termination rate reductions, prior year tariff cuts and wholesale roaming rates. Although the prior year tariff changes resulted in a 30.9% fall in the effective outbound rate per minute, the impact of these changes was partially offset by a strong 38.1% increase in outgoing voice minutes. Messaging revenue also fell 7.7% at constant exchange rates, primarily as a result of higher take up of bundled offers on contract and reductions in messaging per user in the prepaid customer base. Partly offsetting these impacts was strong data revenue growth of 40.1% at constant exchange rates which has been achieved through continued growth in business services and the associated increasing penetration of 3G devices.
Italy
At constant exchange rates, service revenue declined by 2.7%, including an 8.1% decline in voice revenue primarily resulting from the negative impact of the cancellation of top up fees in March 2007 and termination rate cuts. The decrease in voice revenue was partially mitigated by a 14.3% increase in total voice usage, including a 17.8% increase in outgoing voice usage. Growth was driven by successful commercial initiatives which also resulted in a 23.3% increase in closing contract customers, predominantly within the business customer base. Despite the retail price decline, voice roaming revenue grew by 7.7% at constant exchange rates driven by a 15.7% increase in roaming minutes. Continued
10
momentum from successful messaging propositions launched earlier in the calendar year helped achieve messaging growth of 18.4% at constant exchange rates. Strong growth in Vodafone Connect USB Modems, Vodafone Mobile Connect Cards with 3G broadband and an increase in handheld business devices drove data revenue growth of 35.7% at constant exchange rates.
Spain
Service revenue growth in Spain was 10.6% at constant exchange rates. The rate of service revenue growth slowed during the quarter ended 30 September 2007, compared with the previous quarter, due to a strong summer promotion in the prior year, a more intensified competitive market and a lower growth in the average customer base. An 8.7% increase in voice revenue at constant exchange rates was achieved, predominantly due to a 10.3% increase in the customer base, although this was partially impacted by a termination rate cut in the period. 3G devices grew by 148.9% to 4.3 million devices, helping to drive data revenue growth of 41.2% at constant exchange rates compared with the same period last year.
UK
Service revenue in the UK increased by 6.7%, benefiting from a 10.3% increase in the customer base, reflecting an increase in contract customer market share, and from a £30 million VAT refund. Voice revenue increased by 0.9% with increases in voice usage, partly prompted by the increase in the customer base following the success of the refreshed voice tariffs launched in the previous year, more than offsetting falls in price per minute and reductions in roaming rates. Messaging and data revenue growth have remained strong at 21.6% and 37.3%, respectively. Messaging revenue growth reflects the continued success of propositions launched last year. Similarly, increasing penetration of Vodafone Mobile Connect 3G/GPRS data cards and handheld business devices combined with enhanced connectivity service offerings helped drive strong data revenue growth.
Arcor
Arcor generated a 9.6% increase in service revenue at constant exchange rates. In a very competitive market, growth was principally driven by a 39.6% increase in DSL customers to 2.3 million.
Other Europe
Service revenue in Other Europe remained broadly stable compared with the same period last year, after a 0.7% adverse impact from foreign exchange movements. At constant exchange rates, service revenue increased by 6.4% and 5.8% in Portugal and the Netherlands respectively, although these increases were mostly offset by a 6.1% decline in Greece. The decline in Greece arose from the impact of termination rate cuts in January and June of this year and the cessation in April of a national roaming agreement.
Adjusted operating profit
Adjusted operating profit fell by 2.7%, or by 2.3% on an organic basis, while the EBITDA margin decreased by 1.3%. Growth in interconnect costs, other direct costs and acquisition costs was the largest driver behind this decline.
Interconnect costs increased by 4.1% compared with the same period in the prior year, with the increased call volumes in the region partly offset by the benefit obtained from termination rate cuts. The main increases in interconnect costs were recorded in the UK and Italy, partially offset by reductions in Germany.
Other direct costs rose by 8.5%, mostly resulting from Arcor and the UK. Within Arcor, an increase in direct access charges resulted from achieving a higher customer base. The increase in other direct costs in the UK was mainly due to investment in content based data services and, in part, to a portion of commissions being recorded in other direct costs to reflect their ongoing nature following changes to the commercial model.
Acquisition costs increased by 5.7% compared with the same period last year, primarily reflecting increases in the UK, as well as smaller increases in Germany and Italy, partly offset by lower costs in Spain. Acquisition costs in the UK reflected higher contract customer additions and higher costs per addition in a competitive market.
Retention costs increased by 8.0%, predominantly an effect of the increased volume of upgrades in Spain resulting from the recent large customer growth and more proactive churn management. Across the region, costs per upgrade remained similar year on year, except in Italy following increased focus on the retention of high value prepaid customers that began in the summer of the last financial year.
Operating expenses were broadly stable as a result of various initiatives implemented to achieve the broadly stable operating expenses target. Specific actions undertaken included restructuring in Germany, Ireland and in common functions, continued migration from leased lines to owned transmission and further renegotiation of contracts relating to various network operating expenses. This has been achieved despite increasing call volumes carried on the Groups networks and customer care from a growing customer base and an increasingly competitive market place.
11
Germany
Adjusted operating profit fell by 10.5% at constant exchange rates as a result of the reduction in voice revenue. Costs within Germany also fell overall, with the largest reductions experienced in interconnect costs, which fell by 11.5% at constant exchange rates, as a result of the termination rate cut. Operating expenses fell by 5.3% at constant exchange rates resulting from targeted cost reduction programmes. Increases in acquisition and retention costs of 6.5% and 11.6% at constant exchange rates arose as a result of higher gross additions and upgrades. Acquisition costs per customer fell, while retention costs increased 3.2% on a per customer basis. Depreciation and other amortisation charges fell by 8.2% on a constant currency basis due to the centralisation of the service platform operations that was completed in the last financial year and the ongoing progress on centralisation of data centres.
Italy
Adjusted operating profit fell by 6.9% at constant exchange rates, driven primarily by the reduction in service revenue. The main movements in the cost base in Italy were in relation to interconnect costs, which increased by 5.7% at constant exchange rates due to the increased number of outgoing minutes, particularly to other mobile networks, and acquisition costs which increased by 18.5% at constant exchange rates reflecting an increase in volumes, mainly higher value contract customers. Operating expenses remained flat compared to the prior year due to cost saving initiatives. Reduced depreciation and other amortisation of 11.6% at constant exchange rates resulted from lower capital expenditure, including the centralisation of data centre operations.
Spain
Adjusted operating profit increased by 23.0% at constant exchange rates as interconnect costs remained stable, due to the reduction in termination rates and an increase in volume of calls made to other Vodafone customers which do not incur interconnect costs, as well as overall cost control producing a reduction in expenses as a percentage of overall revenue. Retention costs increased by 30.6% at constant exchange rates resulting from an increased volume of upgrades compared to the prior year, which was largely offset by a decrease in acquisition costs of 13.1% at constant exchange rates reflecting lower additions in the current period.
UK
Although service revenue grew by 6.7%, adjusted operating profit decreased by 23.6% mainly due to investment in new customers driving a 26.0% increase in acquisition costs. The higher customer base and new tariffs generated a 27.6% increase in outgoing mobile minutes which in turn increased interconnect costs by 18.4%. Additionally, other direct costs rose by 16.3% due in part to investment in content based data services and an incentive based commission structure for indirect partners, which has led to improved customer retention.
Arcor
Adjusted operating profit increased by 12.1% at constant exchange rates, as the 9.6% increase in service revenue outpaced the 9.3% growth in the cost base at constant exchange rates. The increase in the cost base was primarily driven by other direct costs, which increased by 37.0% at constant exchange rates, as a result of higher direct access charges incurred due to the larger customer base, while other components of the cost base remained relatively stable.
Other Europe
Adjusted operating profit decreased by 1.6%. Portugal and the Netherlands contributed adjusted operating profit growth at constant exchange rates of 15.4% and 39.1% respectively, resulting from strong cost control and a fall in costs as a percentage of service revenue. Growth in these countries was offset by a fall in the share of results in associates, which fell 8.5% at constant exchange rates, and by a decrease in adjusted operating profit at constant exchange rates of 22.3% in Greece, where results were affected by a decline in service revenue, increased retention and marketing costs and a regulatory fine.
12
EMAPA RESULTS
|
|
Eastern |
|
Middle
East |
|
Pacific |
|
Associates |
|
Associates |
|
EMAPA |
|
|
% change |
|
||||
|
|
£m |
|
£m |
|
£m |
|
£m |
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
||
Six months to 30 September 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Voice revenue(1) |
|
1,260 |
|
1,735 |
|
504 |
|
|
|
|
|
3,499 |
|
|
|
|
|
|
||
Messaging revenue |
|
156 |
|
92 |
|
129 |
|
|
|
|
|
377 |
|
|
|
|
|
|
||
Data revenue |
|
49 |
|
50 |
|
28 |
|
|
|
|
|
127 |
|
|
|
|
|
|
||
Fixed line revenue(1) |
|
8 |
|
4 |
|
10 |
|
|
|
|
|
22 |
|
|
|
|
|
|
||
Total service revenue |
|
1,473 |
|
1,881 |
|
671 |
|
|
|
|
|
4,025 |
|
|
40.9 |
|
15.6 |
|
||
Acquisition revenue |
|
26 |
|
124 |
|
61 |
|
|
|
|
|
211 |
|
|
|
|
|
|
||
Retention revenue |
|
11 |
|
|
|
3 |
|
|
|
|
|
14 |
|
|
|
|
|
|
||
Other revenue |
|
14 |
|
14 |
|
23 |
|
|
|
|
|
51 |
|
|
|
|
|
|
||
Total revenue |
|
1,524 |
|
2,019 |
|
758 |
|
|
|
|
|
4,301 |
|
|
39.9 |
|
16.0 |
|
||
Interconnect costs |
|
(252 |
) |
(280 |
) |
(118 |
) |
|
|
|
|
(650 |
) |
|
|
|
|
|
||
Other direct costs |
|
(222 |
) |
(255 |
) |
(133 |
) |
|
|
|
|
(610 |
) |
|
|
|
|
|
||
Acquisition costs |
|
(152 |
) |
(186 |
) |
(105 |
) |
|
|
|
|
(443 |
) |
|
|
|
|
|
||
Retention costs |
|
(41 |
) |
(52 |
) |
(27 |
) |
|
|
|
|
(120 |
) |
|
|
|
|
|
||
Operating expenses |
|
(379 |
) |
(470 |
) |
(201 |
) |
|
|
|
|
(1,050 |
) |
|
|
|
|
|
||
EBITDA |
|
478 |
|
776 |
|
174 |
|
|
|
|
|
1,428 |
|
|
29.8 |
|
13.1 |
|
||
Acquired intangibles amortisation |
|
(104 |
) |
(208 |
) |
|
|
|
|
|
|
(312 |
) |
|
|
|
|
|
||
Purchased licence amortisation |
|
(12 |
) |
(16 |
) |
(8 |
) |
|
|
|
|
(36 |
) |
|
|
|
|
|
||
Depreciation and other amortisation |
|
(191 |
) |
(223 |
) |
(103 |
) |
|
|
|
|
(517 |
) |
|
|
|
|
|
||
Share of result in associates |
|
|
|
1 |
|
|
|
1,180 |
|
|
|
1,181 |
|
|
|
|
|
|
||
Adjusted operating profit |
|
171 |
|
330 |
|
63 |
|
1,180 |
|
|
|
1,744 |
|
|
6.1 |
|
20.8 |
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
EBITDA margin |
|
31.4% |
|
38.4% |
|
23.0% |
|
|
|
|
|
33.2% |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Six months to 30 September 2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Voice revenue(1) |
|
946 |
|
1,027 |
|
458 |
|
|
|
|
|
2,431 |
|
|
|
|
|
|
||
Messaging revenue |
|
147 |
|
66 |
|
118 |
|
|
|
|
|
331 |
|
|
|
|
|
|
||
Data revenue |
|
25 |
|
11 |
|
20 |
|
|
|
|
|
56 |
|
|
|
|
|
|
||
Fixed line revenue(1) |
|
5 |
|
34 |
|
|
|
|
|
|
|
39 |
|
|
|
|
|
|
||
Total service revenue |
|
1,123 |
|
1,138 |
|
596 |
|
|
|
|
|
2,857 |
|
|
|
|
|
|
||
Acquisition revenue |
|
23 |
|
105 |
|
48 |
|
|
|
|
|
176 |
|
|
|
|
|
|
||
Retention revenue |
|
8 |
|
|
|
|
|
|
|
|
|
8 |
|
|
|
|
|
|
||
Other revenue |
|
8 |
|
4 |
|
22 |
|
|
|
|
|
34 |
|
|
|
|
|
|
||
Total revenue |
|
1,162 |
|
1,247 |
|
666 |
|
|
|
|
|
3,075 |
|
|
|
|
|
|
||
Interconnect costs |
|
(217 |
) |
(178 |
) |
(125 |
) |
|
|
|
|
(520 |
) |
|
|
|
|
|
||
Other direct costs |
|
(141 |
) |
(112 |
) |
(100 |
) |
|
|
|
|
(353 |
) |
|
|
|
|
|
||
Acquisition costs |
|
(91 |
) |
(144 |
) |
(78 |
) |
|
|
|
|
(313 |
) |
|
|
|
|
|
||
Retention costs |
|
(31 |
) |
(36 |
) |
(24 |
) |
|
|
|
|
(91 |
) |
|
|
|
|
|
||
Operating expenses |
|
(278 |
) |
(246 |
) |
(174 |
) |
|
|
|
|
(698 |
) |
|
|
|
|
|
||
EBITDA |
|
404 |
|
531 |
|
165 |
|
|
|
|
|
1,100 |
|
|
|
|
|
|
||
Acquired intangibles amortisation |
|
(127 |
) |
(61 |
) |
(1 |
) |
|
|
|
|
(189 |
) |
|
|
|
|
|
||
Purchased licence amortisation |
|
(8 |
) |
(9 |
) |
(7 |
) |
|
|
|
|
(24 |
) |
|
|
|
|
|
||
Depreciation and other amortisation |
|
(151 |
) |
(122 |
) |
(91 |
) |
|
|
|
|
(364 |
) |
|
|
|
|
|
||
Share of result in associates |
|
|
|
|
|
|
|
1,015 |
|
106 |
|
1,121 |
|
|
|
|
|
|
||
Adjusted operating profit |
|
118 |
|
339 |
|
66 |
|
1,015 |
|
106 |
|
1,644 |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
EBITDA margin |
|
34.8% |
|
42.6% |
|
24.8% |
|
|
|
|
|
35.8% |
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
% |
|
% |
|
% |
|
% |
|
% |
|
|
|
|
|
|
|
|
||
Change at constant exchange rates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Voice revenue(1) |
|
31.5 |
|
84.4 |
|
4.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Messaging revenue |
|
2.0 |
|
51.0 |
|
5.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Data revenue |
|
99.2 |
|
395.0 |
|
32.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed line revenue(1) |
|
79.1 |
|
(89.5 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total service revenue |
|
29.2 |
|
79.7 |
|
7.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition revenue |
|
13.7 |
|
32.6 |
|
21.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retention revenue |
|
39.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other revenue |
|
76.5 |
|
353.3 |
|
4.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
29.3 |
|
76.6 |
|
8.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interconnect costs |
|
13.2 |
|
70.9 |
|
(9.7 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other direct costs |
|
48.9 |
|
147.1 |
|
26.7 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition costs |
|
62.1 |
|
45.8 |
|
29.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Retention costs |
|
38.0 |
|
57.5 |
|
7.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses |
|
33.6 |
|
107.9 |
|
10.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
19.6 |
|
58.4 |
|
0.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquired intangibles amortisation |
|
(18.8 |
) |
271.4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased licence amortisation |
|
50.0 |
|
100.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and other amortisation |
|
25.7 |
|
97.3 |
|
7.3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of result in associates |
|
|
|
|
|
|
|
|
26.0 |
|
(100.0 |
) |
|
|
|
|
|
|
|
|
Adjusted operating profit |
|
53.5 |
|
5.2 |
|
(8.5 |
) |
|
26.0 |
|
(100.0 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
EBITDA margin movement |
|
(2.6 |
) |
(4.4 |
) |
(1.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
Note:
(1) Revenue relating to fixed line activities provided by mobile operators, previously classified within voice revenue, is now presented as fixed line revenue, together with revenue from fixed line operators and DSL. All prior periods have been adjusted accordingly.
13
|
|
30 September 2007 |
|
30 September 2006 |
|
||||||||||||
|
|
Eastern Europe |
|
Middle
East Africa & |
|
Pacific |
|
EMAPA |
|
Eastern |
|
Middle
East Africa & |
|
Pacific |
|
EMAPA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Mobile telecommunications KPIs |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Closing customers (000) |
|
31,699 |
|
66,810 |
|
5,840 |
|
104,349 |
|
25,879 |
|
25,374 |
|
5,423 |
|
56,676 |
|
Closing 3G devices (000) |
|
517 |
|
133 |
|
1,022 |
|
1,672 |
|
224 |
|
|
|
534 |
|
758 |
|
Voice usage (millions of minutes) |
|
24,230 |
|
78,865 |
|
6,138 |
|
109,233 |
|
17,790 |
|
17,204 |
|
5,402 |
|
40,396 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See page 35 for definition of terms |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
Service revenue increased by 40.9%, or by 15.6% on an organic basis, with the impact of the acquisition of subsidiaries in Turkey and India and the adverse effect of exchange rate movements, particularly in South Africa, accounting for most of the difference. The impact of acquisitions, disposal and exchange rates on EMAPAs service revenue growth are shown below.
|
|
Organic |
|
Impact
of |
|
|
|
Reported |
|
|
|
|
|
|
|
|
|
|
|
Service revenue |
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
11.0 |
|
2.0 |
|
18.2 |
|
31.2 |
|
Middle East, Africa and Asia |
|
25.1 |
|
(14.4 |
) |
54.6 |
|
65.3 |
|
Pacific |
|
7.4 |
|
5.2 |
|
- |
|
12.6 |
|
EMAPA |
|
15.6 |
|
(2.3 |
) |
27.6 |
|
40.9 |
|
Note:
(1) Impact of acquisitions and disposal includes the impact of the change in consolidation status of Bharti Airtel from a joint venture to an investment in February 2007.
The organic service revenue growth was driven predominantly by an organic increase in total voice minutes of 31.8%, a result of a 28.8% organic increase in the average customer base and usage stimulation strategies, which more than offset the impact of pricing pressures in a number of locations.
Eastern Europe
In Eastern Europe the growth in service revenue benefited from an 18.2 percentage point increase from the prior year acquisition in Turkey, and favourable exchange rate movements of 2.0 percentage points. Organic growth in service revenue was 11.0%, principally driven by an 18.2% organic increase in the average customer base.
Romania continued to be the principal driver of organic growth in Eastern Europe, with service revenue growth of 23.2% at constant exchange rates, mainly as a result of a 19.9% increase in the closing customer base, particularly driven by initiatives focused on business and contract customers which contributed to a 33.9% increase in total voice minutes.
Turkey continued to perform well with strong customer growth of 29.0% since 30 September 2006, bringing the closing customer base to 15.7 million. This led to total revenue growth of around 28%, assuming the Group owned the business for the whole of the same period last year.
Middle East, Africa and Asia
Service revenue in Middle East, Africa and Asia grew strongly with a 25.1% increase on an organic basis, mainly due to strong growth in Egypt and from Vodacom.
Service revenue growth at constant exchange rates in Egypt was 33.9%, predominantly a result of a 64.0% increase in voice usage which was stimulated by the increased customer base of 12.2 million.
Vodacom reported service revenue growth at constant exchange rates of 19.1%, reflecting the Groups share of the 22.6% increase in the closing customer base during the twelve month period to 30 September 2007. The growth in the customer base in the six months ended 30 September 2007 was impacted by a change in the prepaid customer disconnection policy, which resulted in the disconnection of an additional 1.45 million prepaid customers in September 2007. Vodacoms data revenue growth remained very strong, with rapid growth in mobile broadband connectivity devices.
The Groups new business in India reported year on year total revenue growth of around 53%, assuming the Group owned the business for the whole of both periods. Customer net additions between the completion of the acquisition and the end of the period were 8.0 million, bringing the closing customer base to 35.7 million.
14
Pacific
The Groups operations in the Pacific segment delivered 12.6% service revenue growth, or 7.4% on an organic basis, with the impact of favourable foreign exchange movements being the difference. The organic growth was achieved through a 13.6% increase in total voice minute volumes, a result of the 7.7% growth in the closing customer base in the region, with improved contract mix and a focus on higher value prepaid customers in Australia, though this was partially offset by the impact of termination rate reductions in both Australia and New Zealand in the period.
Adjusted operating profit
The impact of acquisitions, disposals and exchange rates on EMAPAs EBITDA and adjusted operating profit is shown below:
|
|
Organic |
|
Impact
of |
|
|
|
Reported |
|
|
|
|
|
|
|
|
|
|
|
EBITDA |
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
14.0 |
|
(1.3 |
) |
5.6 |
|
18.3 |
|
Middle East, Africa and Asia |
|
17.2 |
|
(12.3 |
) |
41.2 |
|
46.1 |
|
Pacific |
|
0.5 |
|
5.0 |
|
- |
|
5.5 |
|
EMAPA |
|
13.1 |
|
(4.6 |
) |
21.3 |
|
29.8 |
|
|
|
|
|
|
|
|
|
|
|
Adjusted operating profit |
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
16.2 |
|
(8.6 |
) |
37.3 |
|
44.9 |
|
Middle East, Africa and Asia |
|
13.3 |
|
(7.9 |
) |
(8.1 |
) |
(2.7 |
) |
Pacific |
|
(8.5 |
) |
4.0 |
|
- |
|
(4.5 |
) |
EMAPA |
|
20.8 |
|
(7.7 |
) |
(7.0 |
) |
6.1 |
|
Note:
(1) Impact of acquisitions and disposals includes the impact of the change in consolidation status of Bharti Airtel from a joint venture to an investment in February 2007.
Adjusted operating profit increased by 6.1%, or by 20.8% on an organic basis, with the increases in revenue achieved by the region being the main driver. The acquisitions in Turkey and India led to a rise in acquired intangible amortisation which reduced the growth in adjusted operating profit, whilst the continued investment in network infrastructure in the region also resulted in higher depreciation charges. The organic growth in adjusted operating profit was driven by strong performances in Romania, Egypt, Vodacom and the Groups associated undertaking in the US.
Eastern Europe
Adjusted operating profit increased by 16.2% on an organic basis, principally as a result of the growth in revenue in the region, whilst the main movements in the cost base in the Eastern Europe region included a 7.4% organic increase in interconnect costs, resulting from the 26.9% organic increase in outgoing voice minutes, principally from the increased customer base, and a 7.3% organic increase in operating expenses due to growth in the regions businesses, but fell slightly as a percentage of service revenue on an organic basis.
Romania remained the principal contributor to the organic growth in costs with a 36.7% increase in interconnect costs at constant exchange rates, a result of the larger customer base and higher average usage per customer, and an increased level of operating expenses due to an increased number of direct sales and distribution employees in a growing business. However, operating expenses decreased as a percentage of service revenue. Romania also accounted for predominantly all of the increase in the regions rise in organic acquisition and retention costs due to higher volumes of gross additions and upgrades.
The main cost drivers in Turkey were acquisition costs and operating expenses. Acquisition costs increased in response to a higher level of gross additions, which resulted from better positioning of both contract and prepaid propositions, with a focus on the contract segment. The increase in operating expenses was mainly due to the expansion of the network and higher marketing expenses, which increased primarily as a result of the increased spending since the rebranding of the business to Vodafone in March 2007.
Middle East, Africa and Asia
Adjusted operating profit increased by 13.3% on an organic basis, as revenue growth more than offset the increase in costs. The organic growth was mainly driven by Egypt and Vodacom.
At constant exchange rates, the key increases in Egypts cost base were interconnect costs which increased by 47.9%, a result of the 77.4% increase in outgoing voice minutes, a 59.8% increase in other direct costs, principally due to prepaid airtime commissions and a 45.7% increase in operating expenses caused by expansion in network infrastructure, and higher marketing and customer care expenses to serve the larger customer base.
15
Growth in adjusted operating profit in Vodacom was impacted by 12.9 percentage points from adverse exchange rate movements. At constant exchange rates, interconnect costs increased by 17.2%, in response to the 34.0% increase in outgoing voice minutes, and operating expenses increased by 24.4% as a result of higher publicity spending.
The Indian mobile market has continued to grow with penetration reaching 18.2% by the end of September 2007. Vodafone Essar, which adopted the Vodafone brand in September 2007, has continued to perform well with EBITDA slightly ahead of the expectations held at the time of the completion of the acquisition. This has been partially due to the Groups rapid network roll out in this market.
Pacific
Adjusted operating profit decreased 4.5%, after including the impact of favourable exchange movements of 4.0 percentage points, as the increased revenue generated in the region was offset by an increase in costs. The principal cost drivers behind the decline were an increase in other direct costs of 26.7% at constant exchange rates, primarily due to Australia reporting higher contract commissions and, in New Zealand, due to the inclusion of DSL costs from ihug following its acquisition in October 2006 combined with an increased provision for its share of the Total Telecom Service Obligation costs, a regulator imposed cost. There was a 34.4% increase in acquisition costs at constant exchange rates in Australia, a result of increased investment in higher value customers in both the contract and prepaid segments. Operating expenses in Australia increased due to investment in marketing, sales and customer care, whilst the reported increase in New Zealand was due to adverse foreign exchange movements impacting the translation into sterling, an increase in the share of billing system costs and higher payroll costs resulting from improvements in customer care.
Associates
|
|
2007 |
|
|
2006 |
|
|
Verizon Wireless change |
|||||||||||
|
|
Verizon
Wireless |
|
Other(1) |
|
Total |
|
|
Verizon |
|
Other(1) |
|
Total |
|
|
£ |
|
Constant
Currency |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of result of associates |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit |
|
1,366 |
|
|
|
1,366 |
|
|
1,214 |
|
136 |
|
1,350 |
|
|
12.5 |
|
21.8 |
|
Interest |
|
(65 |
) |
|
|
(65 |
) |
|
(94 |
) |
2 |
|
(92 |
) |
|
(30.9 |
) |
(26.5 |
) |
Tax |
|
(92 |
) |
|
|
(92 |
) |
|
(73 |
) |
(32 |
) |
(105 |
) |
|
26.0 |
|
37.2 |
|
Minority interest |
|
(29 |
) |
|
|
(29 |
) |
|
(32 |
) |
|
|
(32 |
) |
|
(9.4 |
) |
(2.7 |
) |
|
|
1,180 |
|
|
|
1,180 |
|
|
1,015 |
|
106 |
|
1,121 |
|
|
16.3 |
|
26.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Verizon Wireless (100% basis) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue (£m) |
|
11,042 |
|
|
|
|
|
|
10,327 |
|
|
|
|
|
|
|
|
|
|
EBITDA margin |
|
39.1% |
|
|
|
|
|
|
38.7% |
|
|
|
|
|
|
|
|
|
|
Closing customers (000) |
|
63,699 |
|
|
|
|
|
|
56,747 |
|
|
|
|
|
|
|
|
|
|
Average monthly ARPU ($) |
|
54.1 |
|
|
|
|
|
|
52.6 |
|
|
|
|
|
|
|
|
|
|
Blended churn |
|
15.1% |
|
|
|
|
|
|
14.2% |
|
|
|
|
|
|
|
|
|
|
Messaging and data as a percentage of service revenue |
|
18.4% |
|
|
|
|
|
|
12.9% |
|
|
|
|
|
|
|
|
|
|
Note:
(1) Other associates in 2006 include the results of the Groups associated undertakings in Belgium and Switzerland until the announcement of their respective disposal in August 2006 and December 2006.
Verizon Wireless, the Groups associated undertaking in the US, produced another period of strong organic customer growth, adding 3.4 million net retail customer additions in a market with penetration reaching an estimated 83.1% at 30 September 2007. Total net customer additions of 3.0 million, after 0.4 million net reseller disconnections, equate to 1.3 million in proportionate terms and brought the Groups share of the closing customer base to 28.7 million. The customer growth was achieved through an increase in new customer additions, particularly in the higher value contract segment, and low customer churn driven by market leading customer loyalty.
Service revenue growth was 16.6% at constant exchange rates, driven by the expanding customer base and a 2.9% increase in ARPU. Data revenue continued to increase strongly, predominantly as a result of growth in data card, wireless email and messaging services. Verizon Wireless continued to lay the foundations for future data revenue growth through the expansion of CDMA EV-DO Rev A, an enhanced wireless broadband service, which now covers a population of 210 million.
Verizon Wireless improved its EBITDA margin mainly due to operating expenditure efficiencies offsetting a higher level of customer acquisition and retention activity during the period. The Groups share of the tax attributable to Verizon Wireless relates only to the corporate entities held by the Verizon Wireless partnership. The tax attributable to the Groups share of the partnerships pre-tax profit is included within the Group tax charge.
Verizon Wireless has entered into an agreement to acquire Rural Cellular Corporation for approximately $2.67 billion in cash and assumed debt. The transaction is expected to be completed by the first half of 2008, subject to the receipt of the required regulatory approvals, and will result in an increase in the customer base of Verizon Wireless of more than 0.7 million customers.
16
LIQUIDITY AND CAPITAL RESOURCES
CASH FLOWS AND FUNDING
During the six months ended 30 September 2007, net cash inflow from operating activities fell by 2.3% to £4,860 million and the Group generated £2,661 million of free cash flow, as analysed in the following table:
|
|
Six
months to |
|
|
Six
months to |
|
|
% |
|
|
|
|
|
|
|
|
|
|
|
Net cash inflow from operating activities |
|
4,860 |
|
|
4,975 |
|
|
(2.3 |
) |
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
4,860 |
|
|
4,840 |
|
|
0.4 |
|
Discontinued operations |
|
|
|
|
135 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add: Taxation |
|
1,487 |
|
|
1,217 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of intangible fixed assets |
|
(320 |
) |
|
(298 |
) |
|
|
|
Purchase of property, plant and equipment |
|
(1,902 |
) |
|
(1,892 |
) |
|
|
|
Disposal of property, plant and equipment |
|
13 |
|
|
11 |
|
|
|
|
Operating free cash flow |
|
4,138 |
|
|
4,013 |
|
|
3.1 |
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
4,138 |
|
|
4,021 |
|
|
2.9 |
|
Discontinued operations |
|
|
|
|
(8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Taxation |
|
(1,487 |
) |
|
(1,217 |
) |
|
|
|
Dividends received from associated undertakings (1) |
|
476 |
|
|
371 |
|
|
|
|
Dividends paid to minority shareholders in subsidiary undertakings |
|
(66 |
) |
|
(34 |
) |
|
|
|
Dividends received from investments |
|
72 |
|
|
57 |
|
|
|
|
Interest received |
|
240 |
|
|
256 |
|
|
|
|
Interest paid |
|
(712 |
) |
|
(499 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Free cash flow |
|
2,661 |
|
|
2,947 |
|
|
(9.7 |
) |
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
2,661 |
|
|
2,955 |
|
|
(9.9 |
) |
Discontinued operations |
|
|
|
|
(8 |
) |
|
|
|
Note:
(1) Six months ended 30 September 2007 includes £272 million (2006: £240 million) from the Groups interest in SFR and £199 million (2006: £119 million) from the Groups interest in Verizon Wireless.
Free cash flow decreased primarily as a result of lower cash inflow from operating activities and higher payments for interest and taxation, partially offset by higher dividends received from associates.
An analysis of net debt is as follows:
|
|
30 September |
|
|
31 March |
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents (as presented in the consolidated cash flow statement) |
|
2,873 |
|
|
7,458 |
|
|
Bank overdrafts |
|
28 |
|
|
23 |
|
|
Cash and cash equivalents (as presented in the consolidated balance sheet) |
|
2,901 |
|
|
7,481 |
|
|
|
|
|
|
|
|
|
|
Trade and other receivables(1) |
|
291 |
|
|
304 |
|
|
Trade and other payables(1) |
|
(465 |
) |
|
(219 |
) |
|
Short term borrowings |
|
(5,673 |
) |
|
(4,817 |
) |
|
Long term borrowings(2) |
|
(20,307 |
) |
|
(17,798 |
) |
|
|
|
(26,154 |
) |
|
(22,530 |
) |
|
|
|
|
|
|
|
|
|
Net debt as extracted from the consolidated balance sheet |
|
(23,253 |
) |
|
(15,049 |
) |
|
Notes:
(1) Represents mark to market adjustments on derivative financial instruments which are included as a component of trade and other receivables and trade and other payables.
(2) Includes £2,464 million related to put options over minority interests, including those in Vodafone Essar and Arcor, which are required to be reported as a financial liability.
The Group targets low single A long term credit ratings, with its current credit ratings being P-2/F2/A-2 short term and Baa1 stable/A- stable/A- stable long term from Moodys, Fitch Ratings and Standard & Poors respectively. Credit ratings are not a recommendation to purchase, hold or sell securities, inasmuch as ratings do not comment on market price or suitability for a particular investor, and are subject to revision or withdrawal at any time by the assigning rating organisation. Each rating should be evaluated independently.
17
The Groups credit ratings enable it to have access to a wide range of debt finance, including commercial paper, bonds and committed bank facilities.
In aggregate, the Group has committed facilities of approximately £8,821 million, of which £5,726 million was undrawn and £3,095 million drawn at 30 September 2007. The undrawn facilities include a $5.2 billion Revolving Credit Facility that matures in June 2012 and a $6.1 billion Revolving Credit Facility that matures in June 2009. Both facilities support US and euro commercial paper programmes of up to $15 billion and £5 billion respectively. At 30 September 2007, no amounts were drawn under the US commercial paper programme and 785 million (£548 million) was drawn under the euro commercial paper programme. Other undrawn facilities of £175 million are specific to the Groups subsidiary in Egypt.
The Group has a 25 billion Euro Medium Term Note (EMTN) programme and a US shelf programme which are used to meet medium to long term funding requirements. At 31 March 2007, the nominal value of bonds outstanding was £17,101 million. In the six months to 30 September 2007, bonds with a nominal value of £1,221 million were issued under the EMTN programme. The bonds issued during the six months to 30 September 2007 were as follows:
|
Maturity of bond |
Currency |
Amount million |
|
US shelf programme or EMTN |
|
|
|
|
|
|
6 June 2007 |
6 June 2014 |
EUR |
1,250 |
|
EMTN Programme |
|
|
|
|
|
|
6 June 2007 |
6 June 2022 |
EUR |
500 |
|
EMTN Programme |
At 30 September 2007, the Group had bonds outstanding with a nominal value of £17,206 million. On 24 October 2007, $500 million aggregate principal amount of bonds maturing on 27 February 2037 were issued under the US shelf programme.
On 8 May 2007, the Group acquired a controlling interest in Vodafone Essar. Operating companies acquired in this transaction are funded by external facilities which are non-recourse to other Group companies. At 30 September 2007, a total of INR62.1 billion (£765 million) had been fully drawn from committed bank facilities that mature at various dates up to July 2012. Other companies are funded by fully drawn external bank facilities of INR16.4 billion (£202 million) that mature at various dates up to February 2010.
TOTAL SHAREHOLDER RETURNS
Dividends
The Company provides returns to shareholders through dividends. The Company has historically paid dividends semi-annually, with a regular interim dividend in respect of the first six months of the financial year payable in February and a final dividend payable in August. The directors expect that the Company will continue to pay dividends semi-annually.
The Board remains committed to its policy of distributing 60% of adjusted earnings per share by way of dividend. However, as a result of the earnings dilution arising from the Vodafone Essar acquisition, the payout ratio is expected to rise above 60% in the near term to better reflect the underlying trends of the business.
The directors have announced an interim dividend of 2.49 pence per share, representing a 6.0% increase over last years interim dividend. In growing dividends at 6.0%, ahead of its guidance for modest growth issued in May, the Board has taken into account the Groups current financial performance and its confidence in the prospects for the business.
The ex-dividend date is 21 November 2007 for ordinary shareholders, the record date for the interim dividend is 23 November 2007 and the dividend is payable on 1 February 2008.
Other returns
The Group has no current plans for further share purchases or other one-off shareholder returns. The Board will periodically review the free cash flow, anticipated cash requirements, dividends, credit profile and gearing of the Group and consider additional shareholder returns.
18
OPTION AGREEMENTS AND SIMILAR ARRANGEMENTS
On 8 August 2007 the Group announced that it had decided not to exercise its rights under its agreement with Verizon Communications (Verizon) to sell to Verizon up to $10 billion of the Groups interest in Verizon Wireless. This was the final such option available to Vodafone.
As part of the Vodafone Essar acquisition, the Group acquired less than 50% equity interests in Telecom Investments India Private Limited (TII) and in Omega Telecom Holdings Private Limited (Omega). The Group was granted call options to acquire 100% of the shares in two companies which together indirectly own the remaining shares of TII for, if the market equity of Vodafone Essar at the time of exercise is less than US$25 billion, an aggregate price of US$431 million plus interest or, if the market equity value of Vodafone Essar at the time of exercise is greater than US$25 billion, the fair market value of the shares as agreed between the parties. The Group also has an option to acquire 100% of the shares in a third company which owns the remaining shares in Omega. In conjunction with the receipt of these options, the Group also granted a put option to each of the shareholders of these companies with identical pricing which, if exercised, would require Vodafone to purchase 100% of the equity in the respective company. These options can only be exercised in accordance with Indian law prevailing at the time of exercise.
The Group granted put options exercisable between 8 May 2010 and 8 May 2011 to members of the Essar group of companies that, if exercised, would allow the Essar group to sell its 33% shareholding in Vodafone Essar to the Group for US$5 billion or to sell between US$1 billion and US$5 billion worth of Vodafone Essar shares to the Group at an independently appraised fair market value.
The Group invested a net £4,724 million(1) in acquisition and disposal activities, including the purchase and disposal of investments, in the six months ended 30 September 2007. An analysis of the significant transactions and the changes to the Groups effective interest in the entities is shown below.
|
|
£m |
|
|
Acquisitions(1): |
|
|
|
|
Acquisition of 100% of CGP Investments (Holdings) Limited (CGP), a company with interests in Hutchison Essar Limited (subsequently renamed Vodafone Essar Limited) |
|
(5,428 |
) |
|
Disposals(1): |
|
|
|
|
Partial disposal of Bharti Airtel Limited (from 9.99% to 5.00%) |
|
654 |
|
|
Other net acquisitions and disposals, including investments(1) |
|
50 |
|
|
|
|
|
|
|
|
|
(4,724 |
) |
|
Note:
(1) Amounts are shown net of cash and cash equivalents acquired or disposed.
On 8 May 2007, the Group completed the acquisition of 100% of CGP, a company with interests in Vodafone Essar, from Hutchison Telecommunications International Limited for cash consideration of £5,479 million, gross of £51 million cash and cash equivalents acquired. Following this transaction, the Group has a controlling financial interest in Vodafone Essar. As part of this transaction, the Group also assumed gross debt of £1,466 million, including £217 million related to written put options over minority interests, and issued a written put to the Essar Group for which the present value of the redemption price was £2,154 million.
In conjunction with the acquisition of Vodafone Essar, the Group entered into a share sale and purchase agreement with a Bharti group company regarding the Groups 5.60% direct shareholding in Bharti Airtel. On 9 May 2007, a Bharti group company irrevocably agreed to purchase this shareholding. The Group received £654 million in cash consideration for 4.99% of such shareholding, with the Groups remaining 0.61% direct shareholding to be transferred by November 2008.
There are a number of risk factors and uncertainties that could have a significant effect on the Groups financial performance including:
the level of competition in the markets in which it and its interests operate which may affect the Groups revenue and market share;
decisions and changes in the Groups regulatory environment;
the non achievement of expected benefits from cost reduction initiatives and from business acquisitions;
expected benefits from investment in networks, licences and new technology may not be realised;
19
delays in the development of handsets and network compatibility and components may hinder the deployment of new technologies;
geographic expansion may increase the Groups exposure to unpredictable economic, political and legal risks;
the Groups strategic objectives may be impeded by the fact that it does not have a controlling interest in some of its ventures;
the Groups business may be adversely affected by the non-supply of equipment and support services by a major supplier;
the Group may experience a decline in revenue or profitability notwithstanding its efforts to increase revenue from the introduction of new services; and
the Groups business and its ability to retain customers and attract new customers may be impaired by actual or perceived health risks associated with the transmission of radio waves from mobile telephones, transmitters and associated equipment.
In addition to the above, the Group is exposed to financial risks arising from external factors including the movements in foreign exchange rates, interest rates and other factors such as long term economic growth rates, all of which may impact the Groups financial performance. Non financial risks that could have a significant effect on the Groups financial performance for the six months ending 31 March 2008 and which are outside the Groups control include the willingness and ability of third parties, including regulators, tax raising authorities and commercial partners, to engage and reach agreement on open matters.
Any of the above and/or changes in assumptions underlying the carrying value of certain Group assets could result in asset impairments.
Further information in relation to these risk factors and uncertainties can be found on pages 58 to 59 of the Groups Annual Report for the year ended 31 March 2007 which can be found on www.vodafone.com.
On 6 October 2007, the Group announced that it had agreed to acquire Tele2 Italia SpA (Tele2 Italy) and Tele2 Telecommunication Services SLU (Tele2 Spain) from Tele2 AB Group for a cash consideration of 775 million (£537 million) on a debt free basis.
Tele2 Italy and Tele2 Spain each provide nationwide fixed line telecommunications and broadband services. Tele2 Italy had over 2.6 million customers as at 30 June 2007, including over 400,000 broadband customers. Tele2 Spain had 550,000 customers as at 30 June 2007, including over 240,000 broadband customers.
The transaction is expected to be completed by the end of the calendar year, following receipt of regulatory approval.
We confirm that to the best of our knowledge:
the unaudited Condensed Consolidated Financial Statements have been prepared in accordance with IAS 34; and
the interim management report includes a fair review of the information required by DTR 4.2.7R and DTR 4.2.8R.
Neither the Company nor the directors accept any liability to any person in relation to the half-yearly financial report except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with section 90A of the Financial Services and Markets Act 2000.
By order of the Board
Stephen Scott
Secretary
13 November 2007
20
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENT
|
|
Note |
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
2 |
|
16,994 |
|
|
15,594 |
|
|
31,104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of sales |
|
|
|
(10,212 |
) |
|
(9,022 |
) |
|
(18,725 |
) |
|
Gross profit |
|
|
|
6,782 |
|
|
6,572 |
|
|
12,379 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selling and distribution expenses |
|
|
|
(1,152 |
) |
|
(1,038 |
) |
|
(2,136 |
) |
|
Administrative expenses |
|
|
|
(1,850 |
) |
|
(1,800 |
) |
|
(3,437 |
) |
|
Share of result in associated undertakings |
|
|
|
1,443 |
|
|
1,413 |
|
|
2,728 |
|
|
Impairment losses |
|
|
|
|
|
|
(8,100 |
) |
|
(11,600 |
) |
|
Other income and expense |
|
|
|
(15 |
) |
|
1 |
|
|
502 |
|
|
Operating profit/(loss) |
|
2 |
|
5,208 |
|
|
(2,952 |
) |
|
(1,564 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-operating income and expense |
|
|
|
250 |
|
|
10 |
|
|
4 |
|
|
Investment income |
|
|
|
382 |
|
|
425 |
|
|
789 |
|
|
Financing costs |
|
|
|
(1,280 |
) |
|
(813 |
) |
|
(1,612 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) before taxation |
|
|
|
4,560 |
|
|
(3,330 |
) |
|
(2,383 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
3 |
|
(1,233 |
) |
|
(1,218 |
) |
|
(2,423 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the period from continuing operations |
|
|
|
3,327 |
|
|
(4,548 |
) |
|
(4,806 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss from discontinued operations |
|
|
|
- |
|
|
(491 |
) |
|
(491 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the period |
|
|
|
3,327 |
|
|
(5,039 |
) |
|
(5,297 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
Equity shareholders |
|
|
|
3,290 |
|
|
(5,105 |
) |
|
(5,426 |
) |
|
Minority interests |
|
|
|
37 |
|
|
66 |
|
|
129 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings/(loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) from continuing operations |
|
4 |
|
6.22p |
|
|
(8.02)p |
|
|
(8.94)p |
|
|
Loss from discontinued operations |
|
4 |
|
|
|
|
(0.86)p |
|
|
(0.90)p |
|
|
Profit/(loss) for the period |
|
4 |
|
6.22p |
|
|
(8.88)p |
|
|
(9.84)p |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings/(loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) from continuing operations |
|
4 |
|
6.19p |
|
|
(8.02)p |
|
|
(8.94)p |
|
|
Loss from discontinued operations |
|
4 |
|
|
|
|
(0.86)p |
|
|
(0.90)p |
|
|
Profit/(loss) for the period |
|
4 |
|
6.19p |
|
|
(8.88)p |
|
|
(9.84)p |
|
|
CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE
|
|
|
|
Six months to |
|
|
Six months to 30 September 2006 £m |
|
|
Year ended 31 March 2007 £m |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains on revaluation of available-for-sale investments |
|
|
|
2,568 |
|
|
641 |
|
|
2,108 |
|
|
Exchange differences on translation of foreign operations |
|
|
|
705 |
|
|
(3,293 |
) |
|
(3,804 |
) |
|
Net actuarial gains on defined benefit pension schemes |
|
|
|
53 |
|
|
18 |
|
|
50 |
|
|
Foreign exchange gains transferred to the income statement |
|
|
|
(7 |
) |
|
794 |
|
|
838 |
|
|
Fair value gains transferred to the income statement |
|
|
|
(570 |
) |
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net gain/(loss) recognised directly in equity |
|
|
|
2,749 |
|
|
(1,840 |
) |
|
(808 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the period |
|
|
|
3,327 |
|
|
(5,039 |
) |
|
(5,297 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total recognised income and expense relating to the period |
|
|
|
6,076 |
|
|
(6,879 |
) |
|
(6,105 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
Equity shareholders |
|
|
|
6,096 |
|
|
(6,931 |
) |
|
(6,210 |
) |
|
Minority interests |
|
|
|
(20 |
) |
|
52 |
|
|
105 |
|
|
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
21
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEET
|
|
Note |
|
30 September
|
|
|
30
September |
|
|
31
March |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill |
|
|
|
45,661 |
|
|
44,330 |
|
|
40,567 |
|
|
Other intangible assets |
|
|
|
18,382 |
|
|
16,203 |
|
|
15,705 |
|
|
Property, plant and equipment |
|
|
|
14,832 |
|
|
13,248 |
|
|
13,444 |
|
|
Investments in associated undertakings |
|
|
|
20,615 |
|
|
21,879 |
|
|
20,227 |
|
|
Other investments |
|
|
|
7,492 |
|
|
3,762 |
|
|
5,875 |
|
|
Deferred tax assets |
|
|
|
482 |
|
|
450 |
|
|
410 |
|
|
Post employment benefits |
|
|
|
158 |
|
|
33 |
|
|
82 |
|
|
Trade and other receivables |
|
|
|
516 |
|
|
466 |
|
|
494 |
|
|
|
|
|
|
108,138 |
|
|
100,371 |
|
|
96,804 |
|
|
Current assets |
|
|
|
|
|
|
|
|
|
|
|
|
Inventory |
|
|
|
405 |
|
|
356 |
|
|
288 |
|
|
Taxation recoverable |
|
|
|
27 |
|
|
2 |
|
|
21 |
|
|
Trade and other receivables |
|
|
|
5,739 |
|
|
4,963 |
|
|
5,023 |
|
|
Cash and cash equivalents |
|
|
|
2,901 |
|
|
789 |
|
|
7,481 |
|
|
|
|
|
|
9,072 |
|
|
6,110 |
|
|
12,813 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Assets included in disposal group held for resale |
|
|
|
|
|
|
914 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
|
|
117,210 |
|
|
107,395 |
|
|
109,617 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
Called up share capital |
|
7 |
|
4,180 |
|
|
4,166 |
|
|
4,172 |
|
|
Share premium account |
|
7 |
|
43,782 |
|
|
43,443 |
|
|
43,572 |
|
|
Own shares held |
|
7 |
|
(7,937) |
|
|
(8,153) |
|
|
(8,047) |
|
|
Additional paid-in capital |
|
7 |
|
100,131 |
|
|
100,191 |
|
|
100,185 |
|
|
Capital redemption reserve |
|
7 |
|
9,136 |
|
|
9,121 |
|
|
9,132 |
|
|
Accumulated other recognised income and expense |
|
8 |
|
6,112 |
|
|
2,264 |
|
|
3,306 |
|
|
Retained losses |
|
9 |
|
(83,999) |
|
|
(83,656) |
|
|
(85,253) |
|
|
Total equity shareholders funds |
|
|
|
71,405 |
|
|
67,376 |
|
|
67,067 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Minority interests |
|
|
|
1,148 |
|
|
197 |
|
|
226 |
|
|
Written put options over minority interests |
|
|
|
(2,425) |
|
|
|
|
|
|
|
|
Total minority interests |
|
|
|
(1,277) |
|
|
197 |
|
|
226 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity |
|
|
|
70,128 |
|
|
67,573 |
|
|
67,293 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
Long term borrowings |
|
|
|
20,307 |
|
|
17,014 |
|
|
17,798 |
|
|
Deferred tax liabilities |
|
|
|
5,003 |
|
|
4,901 |
|
|
4,626 |
|
|
Post employment benefits |
|
|
|
114 |
|
|
107 |
|
|
123 |
|
|
Provisions |
|
|
|
253 |
|
|
273 |
|
|
296 |
|
|
Trade and other payables |
|
|
|
615 |
|
|
567 |
|
|
535 |
|
|
|
|
|
|
26,292 |
|
|
22,862 |
|
|
23,378 |
|
|
Current liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
Short term borrowings: |
|
|
|
|
|
|
|
|
|
|
|
|
Third parties |
|
|
|
4,652 |
|
|
3,539 |
|
|
3,975 |
|
|
Related parties |
|
|
|
1,021 |
|
|
575 |
|
|
842 |
|
|
Current taxation liabilities |
|
|
|
4,997 |
|
|
4,911 |
|
|
5,088 |
|
|
Provisions |
|
|
|
253 |
|
|
167 |
|
|
267 |
|
|
Trade and other payables |
|
|
|
9,867 |
|
|
7,768 |
|
|
8,774 |
|
|
|
|
|
|
20,790 |
|
|
16,960 |
|
|
18,946 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total equity and liabilities |
|
|
|
117,210 |
|
|
107,395 |
|
|
109,617 |
|
|
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
22
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
CONSOLIDATED CASH FLOW STATEMENT
|
|
Note |
|
Six
months to |
|
|
Six
months to 30 |
|
|
Year
ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows from operating activities |
|
6 |
|
4,860 |
|
|
4,975 |
|
|
10,328 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
|
|
|
|
|
|
|
Purchase of interests in subsidiary undertakings and joint ventures, net of cash acquired |
|
10 |
|
(5,475) |
|
|
(2,585) |
|
|
(2,805) |
|
|
Disposal of interests in subsidiary undertakings, net of cash disposed |
|
11 |
|
|
|
|
6,799 |
|
|
6,767 |
|
|
Disposal of interests in associated undertakings |
|
|
|
|
|
|
|
|
|
3,119 |
|
|
Purchase of intangible assets |
|
|
|
(320) |
|
|
(298) |
|
|
(899) |
|
|
Purchase of property, plant and equipment |
|
|
|
(1,902) |
|
|
(1,892) |
|
|
(3,633) |
|
|
Purchase of investments |
|
|
|
(30) |
|
|
(154) |
|
|
(172) |
|
|
Disposal of property, plant and equipment |
|
|
|
13 |
|
|
11 |
|
|
34 |
|
|
Disposal of investments |
|
11 |
|
781 |
|
|
|
|
|
80 |
|
|
Dividends received from associated undertakings |
|
|
|
476 |
|
|
371 |
|
|
791 |
|
|
Dividends received from investments |
|
|
|
72 |
|
|
57 |
|
|
57 |
|
|
Interest received |
|
|
|
240 |
|
|
256 |
|
|
526 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows from investing activities |
|
|
|
(6,145) |
|
|
2,565 |
|
|
3,865 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
|
|
|
|
|
|
|
Issue of ordinary share capital and reissue of treasury shares |
|
|
|
170 |
|
|
39 |
|
|
193 |
|
|
Net movement in short term borrowings |
|
|
|
(104) |
|
|
426 |
|
|
953 |
|
|
Proceeds from issue of long term borrowings |
|
|
|
1,119 |
|
|
2,451 |
|
|
5,150 |
|
|
Repayment of borrowings |
|
|
|
(1,271) |
|
|
(453) |
|
|
(1,961) |
|
|
Purchase of treasury shares |
|
|
|
|
|
|
(43) |
|
|
(43) |
|
|
B share capital redemption |
|
|
|
(4) |
|
|
(5,707) |
|
|
(5,713) |
|
|
B share preference dividends paid |
|
|
|
|
|
|
(3,286) |
|
|
(3,291) |
|
|
Equity dividends paid |
|
|
|
(2,334) |
|
|
(2,315) |
|
|
(3,555) |
|
|
Dividends paid to minority shareholders in subsidiary undertakings |
|
|
|
(66) |
|
|
(34) |
|
|
(34) |
|
|
Interest paid |
|
|
|
(712) |
|
|
(499) |
|
|
(1,051) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows from financing activities |
|
|
|
(3,202) |
|
|
(9,421) |
|
|
(9,352) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows |
|
|
|
(4,487) |
|
|
(1,881) |
|
|
4,841 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at beginning of the period |
|
|
|
7,458 |
|
|
2,932 |
|
|
2,932 |
|
|
Exchange losses on cash and cash equivalents |
|
|
|
(98) |
|
|
(275) |
|
|
(315) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of the period |
|
|
|
2,873 |
|
|
776 |
|
|
7,458 |
|
|
The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.
23
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
1 Basis of preparation
The unaudited Condensed Consolidated Financial Statements for the six months ended 30 September 2007:
were prepared in accordance with International Accounting Standard 34 Interim Financial Reporting (IAS 34) and thereby International Financial Reporting Standards (IFRS), both as issued by the International Accounting Standards Board (IASB) and as adopted by the European Union (EU);
are presented on a condensed basis as permitted by IAS 34 and therefore do not include all disclosures that would otherwise be required in a full set of financial statements and should be read in conjunction with the 2007 Annual Report;
include all adjustments, consisting of normal recurring adjustments, necessary for a fair statement of the results for the periods presented;
do not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985 and were approved by the Board of directors on 13 November 2007.
Both IFRS as issued by the IASB and as adopted by the EU differ in certain material respects from US generally accepted accounting principles (US GAAP) see note 14.
The information relating to the year ended 31 March 2007 is an extract from the published Annual Report for that year, which has been delivered to the Registrar of Companies, and on which the Auditors Report was unqualified and did not contain statements under section 237(2) or 237(3) of the UK Companies Act 1985.
The preparation of the Condensed Consolidated Financial Statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet date, and the reported amounts of revenue and expenses during the reporting period. Actual results could vary from these estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.
24
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
2 Segmental and other analyses
The Group has one business segment, being the supply of communications services and products. The Groups analysis of revenue and operating profit for discontinued operations are shown in note 11. During the six months ended 30 September 2007, the Group changed its organisation structure and the Groups associated undertaking in France, SFR, is now managed within the Europe region and reported within Other Europe. The results for all periods are presented in accordance with the new structure.
Revenue
Six months to |
|
Segment |
|
Common |
(1)
|
Intra- |
|
Regional |
|
Inter- |
|
Group |
|
Germany |
|
2,650 |
|
|
|
(63 |
) |
2,587 |
|
(5 |
) |
2,582 |
|
Italy |
|
2,097 |
|
|
|
(21 |
) |
2,076 |
|
(3 |
) |
2,073 |
|
Spain |
|
2,439 |
|
|
|
(62 |
) |
2,377 |
|
(3 |
) |
2,374 |
|
UK |
|
2,717 |
|
|
|
(25 |
) |
2,692 |
|
(5 |
) |
2,687 |
|
Arcor |
|
768 |
|
|
|
(32 |
) |
736 |
|
- |
|
736 |
|
Other Europe |
|
2,243 |
|
|
|
(42 |
) |
2,201 |
|
(3 |
) |
2,198 |
|
Europe |
|
12,914 |
|
|
|
(245 |
) |
12,669 |
|
(19 |
) |
12,650 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
1,524 |
|
|
|
- |
|
1,524 |
|
(21 |
) |
1,503 |
|
Middle East, Africa and Asia |
|
2,019 |
|
|
|
- |
|
2,019 |
|
(6 |
) |
2,013 |
|
Pacific |
|
758 |
|
|
|
- |
|
758 |
|
(5 |
) |
753 |
|
EMAPA |
|
4,301 |
|
|
|
- |
|
4,301 |
|
(32 |
) |
4,269 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions(1) |
|
- |
|
80 |
|
- |
|
80 |
|
(5 |
) |
75 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
17,215 |
|
80 |
|
(245 |
) |
17,050 |
|
(56 |
) |
16,994 |
|
Six months to |
|
Segment |
|
Common |
(1)
|
Intra- |
|
Regional |
|
Inter- |
|
Group |
|
Germany |
|
2,827 |
|
|
|
(67 |
) |
2,760 |
|
(4 |
) |
2,756 |
|
Italy |
|
2,174 |
|
|
|
(27 |
) |
2,147 |
|
(3 |
) |
2,144 |
|
Spain |
|
2,268 |
|
|
|
(65 |
) |
2,203 |
|
(2 |
) |
2,201 |
|
UK |
|
2,549 |
|
|
|
(29 |
) |
2,520 |
|
(5 |
) |
2,515 |
|
Arcor |
|
706 |
|
|
|
(14 |
) |
692 |
|
|
|
692 |
|
Other Europe |
|
2,216 |
|
|
|
(54 |
) |
2,162 |
|
(2 |
) |
2,160 |
|
Europe |
|
12,740 |
|
|
|
(256 |
) |
12,484 |
|
(16 |
) |
12,468 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
1,162 |
|
|
|
|
|
1,162 |
|
(16 |
) |
1,146 |
|
Middle East, Africa and Asia |
|
1,247 |
|
|
|
|
|
1,247 |
|
(5 |
) |
1,242 |
|
Pacific |
|
666 |
|
|
|
|
|
666 |
|
(4 |
) |
662 |
|
EMAPA |
|
3,075 |
|
|
|
|
|
3,075 |
|
(25 |
) |
3,050 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions(1) |
|
|
|
86 |
|
|
|
86 |
|
(10 |
) |
76 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
15,815 |
|
86 |
|
(256 |
) |
15,645 |
|
(51 |
) |
15,594 |
|
Year
ended |
|
Segment |
|
Common |
(1)
|
Intra- |
|
Regional |
|
Inter- |
|
Group |
|
Germany |
|
5,443 |
|
|
|
(123 |
) |
5,320 |
|
(9 |
) |
5,311 |
|
Italy |
|
4,245 |
|
|
|
(44 |
) |
4,201 |
|
(5 |
) |
4,196 |
|
Spain |
|
4,500 |
|
|
|
(106 |
) |
4,394 |
|
(3 |
) |
4,391 |
|
UK |
|
5,124 |
|
|
|
(54 |
) |
5,070 |
|
(9 |
) |
5,061 |
|
Arcor |
|
1,441 |
|
|
|
(27 |
) |
1,414 |
|
|
|
1,414 |
|
Other Europe |
|
4,275 |
|
|
|
(82 |
) |
4,193 |
|
(4 |
) |
4,189 |
|
Europe |
|
25,028 |
|
|
|
(436 |
) |
24,592 |
|
(30 |
) |
24,562 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
2,477 |
|
|
|
|
|
2,477 |
|
(31 |
) |
2,446 |
|
Middle East, Africa and Asia |
|
2,565 |
|
|
|
|
|
2,565 |
|
(9 |
) |
2,556 |
|
Pacific |
|
1,399 |
|
|
|
|
|
1,399 |
|
(11 |
) |
1,388 |
|
EMAPA |
|
6,441 |
|
|
|
|
|
6,441 |
|
(51 |
) |
6,390 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions(1) |
|
|
|
168 |
|
|
|
168 |
|
(16 |
) |
152 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31,469 |
|
168 |
|
(436 |
) |
31,201 |
|
(97 |
) |
31,104 |
|
Note:
(1) Common functions represents results from Partner Markets and unallocated central Group income and expenses.
25
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
2 Segmental and other analyses (continued)
Segment result
Six
months to |
|
|
|
Operating |
|
Impairment |
|
Other |
|
Adjusted |
|
Germany |
|
|
|
644 |
|
- |
|
- |
|
644 |
|
Italy |
|
|
|
776 |
|
- |
|
- |
|
776 |
|
Spain |
|
|
|
715 |
|
- |
|
- |
|
715 |
|
UK |
|
|
|
243 |
|
- |
|
- |
|
243 |
|
Arcor |
|
|
|
92 |
|
- |
|
- |
|
92 |
|
Other Europe |
|
|
|
799 |
|
- |
|
- |
|
799 |
|
Europe |
|
|
|
3,269 |
|
- |
|
- |
|
3,269 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
|
|
156 |
|
- |
|
15 |
|
171 |
|
Middle East, Africa and Asia |
|
|
|
330 |
|
- |
|
- |
|
330 |
|
Pacific |
|
|
|
63 |
|
- |
|
- |
|
63 |
|
Associates - US |
|
|
|
1,180 |
|
- |
|
- |
|
1,180 |
|
EMAPA |
|
|
|
1,729 |
|
- |
|
15 |
|
1,744 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions |
|
|
|
210 |
|
- |
|
- |
|
210 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,208 |
|
- |
|
15 |
|
5,223 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months to |
|
|
|
Operating |
|
Impairment |
|
Other |
|
Adjusted |
|
Germany |
|
|
|
(5,976) |
|
6,700 |
|
- |
|
724 |
|
Italy |
|
|
|
(561) |
|
1,400 |
|
- |
|
839 |
|
Spain |
|
|
|
585 |
|
- |
|
|
|
585 |
|
UK |
|
|
|
318 |
|
- |
|
|
|
318 |
|
Arcor |
|
|
|
83 |
|
- |
|
|
|
83 |
|
Other Europe |
|
|
|
812 |
|
- |
|
|
|
812 |
|
Europe |
|
|
|
(4,739) |
|
8,100 |
|
- |
|
3,361 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
|
|
118 |
|
- |
|
|
|
118 |
|
Middle East, Africa and Asia |
|
|
|
339 |
|
- |
|
|
|
339 |
|
Pacific |
|
|
|
66 |
|
- |
|
|
|
66 |
|
Associates - US |
|
|
|
1,021 |
|
- |
|
(6) |
|
1,015 |
|
Associates - Other |
|
|
|
106 |
|
- |
|
|
|
106 |
|
EMAPA |
|
|
|
1,650 |
|
- |
|
(6) |
|
1,644 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions |
|
|
|
137 |
|
- |
|
(1) |
|
136 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2,952) |
|
8,100 |
|
(7) |
|
5,141 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended |
|
|
|
Operating |
|
Impairment |
|
Other |
|
Adjusted |
|
Germany |
|
|
|
(5,345) |
|
6,700 |
|
(1) |
|
1,354 |
|
Italy |
|
|
|
(3,325) |
|
4,900 |
|
- |
|
1,575 |
|
Spain |
|
|
|
1,100 |
|
|
|
|
|
1,100 |
|
UK |
|
|
|
511 |
|
|
|
|
|
511 |
|
Arcor |
|
|
|
171 |
|
|
|
|
|
171 |
|
Other Europe |
|
|
|
1,448 |
|
|
|
|
|
1,448 |
|
Europe |
|
|
|
(5,440) |
|
11,600 |
|
(1) |
|
6,159 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
|
|
184 |
|
- |
|
|
|
184 |
|
Middle East, Africa and Asia |
|
|
|
694 |
|
- |
|
|
|
694 |
|
Pacific |
|
|
|
159 |
|
- |
|
|
|
159 |
|
Associates - US |
|
|
|
2,080 |
|
- |
|
(3) |
|
2,077 |
|
Associates - Other |
|
|
|
638 |
|
- |
|
(508) |
|
130 |
|
EMAPA |
|
|
|
3,755 |
|
- |
|
(511) |
|
3,244 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions |
|
|
|
121 |
|
- |
|
7 |
|
128 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,564) |
|
11,600 |
|
(505) |
|
9,531 |
|
26
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
3 Taxation
|
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
United Kingdom corporation tax benefit at 30% (2006: 30%): |
|
|
|
|
|
|
|
|
|
|
Current year |
|
|
|
|
|
|
|
|
|
|
Adjustments in respect of prior years |
|
(65 |
) |
|
(39 |
) |
|
(30 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Overseas corporation tax: |
|
|
|
|
|
|
|
|
|
|
Current year |
|
1,393 |
|
|
2,084 |
|
|
2,928 |
|
|
Adjustments in respect of prior years |
|
(3 |
) |
|
(162 |
) |
|
215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current tax expense |
|
1,325 |
|
|
1,883 |
|
|
3,113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax: |
|
|
|
|
|
|
|
|
|
|
United Kingdom deferred tax |
|
(66 |
) |
|
(50 |
) |
|
(49 |
) |
|
Overseas deferred tax |
|
(26 |
) |
|
(615 |
) |
|
(641 |
) |
|
Deferred tax benefit |
|
(92 |
) |
|
(665 |
) |
|
(690 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Total income tax expense |
|
1,233 |
|
|
1,218 |
|
|
2,423 |
|
|
4 Earnings/(loss) per share
|
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average number of shares for basic earnings/(loss) per share |
|
52,935 |
|
|
57,515 |
|
|
55,144 |
|
|
Dilutive potential shares: restricted shares and share options(1) |
|
181 |
|
|
- |
|
|
- |
|
|
Weighted average number of shares for diluted earnings/(loss) per share |
|
53,116 |
|
|
57,515 |
|
|
55,144 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
£m |
|
|
£m |
|
|
£m |
|
|
Earnings/(loss) for basic and diluted earnings per share: |
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
3,290 |
|
|
(4,611 |
) |
|
(4,932) |
|
|
Discontinued operations |
|
- |
|
|
(494 |
) |
|
(494) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
3,290 |
|
|
(5,105 |
) |
|
(5,426) |
|
|
Note:
(1) In the six months ended 30 September 2006 and the year ended 31 March 2007, 140 million shares and 215 million shares, respectively, have been excluded from the calculation of the weighted average number of shares as they are not dilutive.
5 Dividends
|
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity dividends on ordinary shares: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Declared during the period: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Final dividend for the year ended 31 March 2007: 4.41 pence per share (2006: 3.87 pence per share) |
|
2,331 |
|
|
2,328 |
|
|
2,328 |
|
|
Interim dividend for the year ended 31 March 2007: 2.35 pence per share |
|
|
|
|
|
|
|
1,238 |
|
|
|
|
2,331 |
|
|
2,328 |
|
|
3,566 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Proposed after the balance sheet date and not recognised as a liability: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Final dividend for the year ended 31 March 2007: 4.41 pence per share |
|
|
|
|
|
|
|
2,331 |
|
|
Interim dividend for the year ending 31 March 2008: 2.49 pence per share (2007: 2.35 pence per share) |
|
1,322 |
|
|
1,238 |
|
|
|
|
|
27
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
6 Cash flow information
Reconciliation of net cash flows from operating activities: |
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the period from continuing operations |
|
3,327 |
|
|
(4,548 |
) |
|
(4,806 |
) |
Loss for the period from discontinued operations |
|
|
|
|
(491 |
) |
|
(491 |
) |
Adjustments(1): |
|
|
|
|
|
|
|
|
|
Share-based payment |
|
54 |
|
|
49 |
|
|
93 |
|
Depreciation and amortisation |
|
2,755 |
|
|
2,488 |
|
|
5,111 |
|
Loss on disposal of property, plant and equipment |
|
30 |
|
|
19 |
|
|
44 |
|
Share of result in associated undertakings |
|
(1,443 |
) |
|
(1,413 |
) |
|
(2,728 |
) |
Impairment losses |
|
|
|
|
8,100 |
|
|
11,600 |
|
Other income and expense |
|
15 |
|
|
(1 |
) |
|
(502 |
) |
Non-operating income and expense |
|
(250 |
) |
|
(10 |
) |
|
(4 |
) |
Investment income |
|
(382 |
) |
|
(425 |
) |
|
(789 |
) |
Financing costs |
|
1,280 |
|
|
805 |
|
|
1,604 |
|
Income tax expense |
|
1,233 |
|
|
1,088 |
|
|
2,293 |
|
Loss on disposal of discontinued operations |
|
|
|
|
747 |
|
|
747 |
|
Increase in inventory |
|
(106 |
) |
|
(92 |
) |
|
(23 |
) |
Increase in trade and other receivables |
|
(288 |
) |
|
(868 |
) |
|
(753 |
) |
Increase in trade and other payables |
|
122 |
|
|
744 |
|
|
1,175 |
|
|
|
|
|
|
|
|
|
|
|
Cash generated by operations |
|
6,347 |
|
|
6,192 |
|
|
12,571 |
|
|
|
|
|
|
|
|
|
|
|
Tax paid |
|
(1,487 |
) |
|
(1,217 |
) |
|
(2,243 |
) |
|
|
|
|
|
|
|
|
|
|
Net cash flows from operating activities |
|
4,860 |
|
|
4,975 |
|
|
10,328 |
|
Note:
(1) In the six months to 30 September 2006 and the year ended 31 March 2007, adjustments include amounts relating to continuing and discontinued operations.
7 Transactions with equity shareholders
|
|
Called up |
|
|
Share |
|
|
Own |
|
|
Additional |
|
|
Capital |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 April 2006 |
|
4,165 |
|
|
52,444 |
|
|
(8,198 |
) |
|
100,152 |
|
|
128 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issue of new shares |
|
1 |
|
|
25 |
|
|
|
|
|
(7 |
) |
|
- |
|
Own shares released on vesting of share awards |
|
|
|
|
|
|
|
45 |
|
|
|
|
|
- |
|
Share consolidation |
|
|
|
|
(9,026 |
) |
|
|
|
|
|
|
|
|
|
B share capital redemption |
|
|
|
|
|
|
|
|
|
|
|
|
|
5,707 |
|
B share preference dividend |
|
|
|
|
|
|
|
|
|
|
|
|
|
3,286 |
|
Share-based
payment charge, inclusive of |
|
- |
|
|
- |
|
|
- |
|
|
46 |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30 September 2006 |
|
4,166 |
|
|
43,443 |
|
|
(8,153 |
) |
|
100,191 |
|
|
9,121 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issue of new shares |
|
6 |
|
|
129 |
|
|
|
|
|
(37 |
) |
|
- |
|
Own shares released on vesting of share awards |
|
|
|
|
|
|
|
106 |
|
|
|
|
|
- |
|
B share capital redemption |
|
|
|
|
|
|
|
|
|
|
|
|
|
6 |
|
B share preference dividend |
|
|
|
|
|
|
|
|
|
|
|
|
|
5 |
|
Share-based
payment charge, inclusive of |
|
|
|
|
|
|
|
|
|
|
31 |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31 March 2007 |
|
4,172 |
|
|
43,572 |
|
|
(8,047 |
) |
|
100,185 |
|
|
9,132 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issue of new shares |
|
8 |
|
|
206 |
|
|
|
|
|
(114 |
) |
|
|
|
Own shares released on vesting of share awards |
|
|
|
|
4 |
|
|
110 |
|
|
(4 |
) |
|
|
|
B share capital redemption |
|
|
|
|
|
|
|
|
|
|
|
|
|
4 |
|
Share-based payment charge, inclusive of tax credit of £10 million |
|
|
|
|
|
|
|
|
|
|
64 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30 September 2007 |
|
4,180 |
|
|
43,782 |
|
|
(7,937 |
) |
|
100,131 |
|
|
9,136 |
|
28
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
8 Movements in accumulated other recognised income and expense
|
|
Translation |
|
|
Pensions |
|
|
Available-for- |
|
|
Asset |
|
|
Total |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1 April 2006 |
|
3,043 |
|
|
(109 |
) |
|
1,044 |
|
|
112 |
|
|
4,090 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Losses)/gains arising in the period |
|
(3,279 |
) |
|
26 |
|
|
641 |
|
|
|
|
|
(2,612 |
) |
Transfer to the income statement on disposal |
|
794 |
|
|
|
|
|
|
|
|
|
|
|
794 |
|
Tax effect |
|
|
|
|
(8 |
) |
|
|
|
|
|
|
|
(8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30 September 2006 |
|
558 |
|
|
(91 |
) |
|
1,685 |
|
|
112 |
|
|
2,264 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Losses)/gains arising in the period |
|
(523 |
) |
|
39 |
|
|
1,467 |
|
|
|
|
|
983 |
|
Transfer to the income statement on disposal |
|
44 |
|
|
|
|
|
|
|
|
|
|
|
44 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tax effect |
|
22 |
|
|
(7 |
) |
|
|
|
|
|
|
|
15 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31 March 2007 |
|
101 |
|
|
(59 |
) |
|
3,152 |
|
|
112 |
|
|
3,306 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gains arising in the period |
|
779 |
|
|
75 |
|
|
2,568 |
|
|
- |
|
|
3,422 |
|
Transfer to the income statement on disposal |
|
(7 |
) |
|
- |
|
|
(570 |
) |
|
- |
|
|
(577 |
) |
Tax effect |
|
(17 |
) |
|
(22 |
) |
|
- |
|
|
- |
|
|
(39 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
30 September 2007 |
|
856 |
|
|
(6 |
) |
|
5,150 |
|
|
112 |
|
|
6,112 |
|
9 Movements in retained losses
|
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
1 April |
|
(85,253 |
) |
|
(67,356 |
) |
|
(67,356 |
) |
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the period |
|
3,290 |
|
|
(5,105 |
) |
|
(5,426 |
) |
Dividends |
|
(2,331 |
) |
|
(2,328 |
) |
|
(3,566 |
) |
Expiration of equity put right |
|
- |
|
|
142 |
|
|
142 |
|
Loss on issue of treasury shares |
|
(52 |
) |
|
(16 |
) |
|
(43 |
) |
B share capital redemption |
|
(4 |
) |
|
(5,707 |
) |
|
(5,713 |
) |
B share preference dividend |
|
- |
|
|
(3,286 |
) |
|
(3,291 |
) |
Grant of equity put right |
|
333 |
|
|
- |
|
|
- |
|
Other movements |
|
18 |
|
|
- |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
30 September / 31 March |
|
(83,999 |
) |
|
(83,656 |
) |
|
(85,253 |
) |
29
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
10 Acquisitions
Hutchison Essar Limited (since renamed Vodafone Essar Limited)
On 8 May 2007, the Group completed the acquisition of 100% of CGP Investments (Holdings) Limited (CGP), a company with interests in Vodafone Essar Limited (Vodafone Essar), from Hutchison Telecommunications International Limited for cash consideration of US$10.9 billion (£5.5bn). Following this transaction, the Group has a controlling financial interest in Vodafone Essar. The initial purchase price allocation has been determined to be provisional pending the completion of the final valuation of the fair value of assets acquired. The transaction has been accounted for using the purchase method of accounting.
|
|
Book value |
|
|
Fair value |
|
|
Fair value |
|
Net assets acquired: |
|
|
|
|
|
|
|
|
|
Identifiable intangible assets |
|
121 |
|
|
3,068 |
|
|
3,189 |
(1) |
Property, plant and equipment |
|
1,215 |
|
|
(145 |
) |
|
1,070 |
|
Other investments |
|
199 |
|
|
- |
|
|
199 |
|
Deferred tax assets |
|
33 |
|
|
60 |
|
|
93 |
|
Inventory |
|
5 |
|
|
(2 |
) |
|
3 |
|
Trade and other receivables |
|
285 |
|
|
15 |
|
|
300 |
|
Cash and cash equivalents |
|
51 |
|
|
- |
|
|
51 |
|
Deferred tax liabilities |
|
- |
|
|
(547 |
) |
|
(547 |
) |
Short and long term borrowings(2) |
|
(1,466 |
) |
|
- |
|
|
(1,466 |
) |
Trade and other payables |
|
(546 |
) |
|
(19 |
) |
|
(565 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
(103 |
) |
|
2,430 |
|
|
2,327 |
|
|
|
|
|
|
|
|
|
|
|
Minority interests |
|
|
|
|
|
|
|
(958 |
) |
Written put options over minority interests(2) |
|
|
|
|
|
|
|
217 |
|
Goodwill |
|
|
|
|
|
|
|
3,893 |
|
|
|
|
|
|
|
|
|
|
|
Total consideration (including £24 million of directly attributable costs)(3) |
|
|
|
|
|
|
|
5,479 |
|
Notes:
(1) Identifiable intangible assets of £3,189 million consist of licences and spectrum fees of £3,045 million and other intangible assets of £144 million.
(2) Included within short term and long term borrowings are liabilities of £217 million related to written put options over minority interests
(3) After deducting cash and cash equivalents acquired of £51 million, the net cash outflow on the acquisition was £5,428 million.
The goodwill is attributable to the expected profitability of the acquired business and the synergies expected to arise after the Group's acquisition of CGP. The results of CGP have been consolidated in the income statement from the acquisition date, 8 May 2007. The weighted average life of licence and spectrum fees was 10 years, the weighted average life of other intangible assets was two years and the weighted average life of total intangible assets was nine years.
The following unaudited pro forma summary presents the Group as if CGP had been acquired on 1 April 2007 or 1 April 2006, respectively. The pro forma amounts include the results of CGP, amortisation of the acquired intangible assets recognised on acquisition and the interest expenses on debt issued as a result of the acquisition. The pro forma amounts do not include any possible synergies from mergers and acquisitions. The pro forma information is provided for comparative purposes only and does not necessarily reflect the actual results that would have occurred, nor is it necessarily indicative of future results of operations of the combined companies.
|
|
Six months to |
|
|
Six months
to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
17,115 |
|
|
16,126 |
|
|
32,274 |
|
Profit/(loss) for the period |
|
3,289 |
|
|
(5,202 |
) |
|
(5,628 |
) |
Profit/(loss) attributable to equity shareholders |
|
3,259 |
|
|
(5,240 |
) |
|
(5,700 |
) |
Basic earnings/(loss) per share |
|
6.16p |
|
|
(9.11p |
) |
|
(10.34p |
) |
Diluted earnings/(loss) per share |
|
6.14p |
|
|
(9.11p |
) |
|
(10.34p |
) |
Other
The Group completed a number of smaller acquisitions resulting in a cash outflow, net of cash acquired, of £47 million.
11 Disposals
Japan Vodafone K.K.
On 17 March 2006, the Group announced an agreement to sell its 97.7% holding in Vodafone K.K. to SoftBank. The transaction completed on 27 April 2006 with the Group receiving cash of approximately ¥1.42 trillion (£6.9 billion) including the repayment of intercompany debt of ¥0.16 trillion (£0.8 billion). In addition, the Group received non-cash consideration with a fair value of approximately ¥0.23 trillion (£1.1 billion), comprised of preferred equity and a subordinated loan. SoftBank also assumed debt of approximately ¥0.13 trillion (£0.6 billion). Vodafone K.K. represented a separate geographical area of operation and, on this basis, Vodafone K.K. was treated as a discontinued operation in Vodafone Group Plcs Annual Reports for the years ended 31 March 2007 and 2006.
30
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
11 Disposals (continued)
A loss of £0.7 billion arose on the disposal, being the proceeds less the carrying amount of Vodafone K.K.s net assets and attributable goodwill together with cumulative exchange differences transferred to the income statement on disposal.
Segment information for discontinued operations
|
|
Six months to |
|
|
Six months to |
|
|
Year ended |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment revenue |
|
- |
|
|
520 |
|
|
520 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit |
|
- |
|
|
118 |
|
|
118 |
|
|
Cash flows from discontinued operations
|
|
Six months to 30 September 2007 £m |
|
|
Six months to 30 September 2006 £m |
|
|
Year ended 31 March 2007 £m |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows from operating activities |
|
- |
|
|
135 |
|
|
135 |
|
|
Net cash flows from investing activities |
|
- |
|
|
(266 |
) |
|
(266 |
) |
|
Net cash flows from financing activities |
|
- |
|
|
(29 |
) |
|
(29 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net cash flows |
|
- |
|
|
(160 |
) |
|
(160 |
) |
|
Cash and cash equivalents at the beginning of the period |
|
- |
|
|
161 |
|
|
161 |
|
|
Exchange loss on cash and cash equivalents |
|
- |
|
|
(1 |
) |
|
(1 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at the end of the period |
|
- |
|
|
- |
|
|
- |
|
|
India Bharti Airtel Limited
In conjunction with the acquisition of Vodafone Essar, the Group entered into a share sale and purchase agreement with a Bharti group company regarding the Groups 5.60% direct shareholding in Bharti Airtel Limited. On 9 May 2007, a Bharti group company irrevocably agreed to purchase this shareholding. During the six months ended 30 September 2007, the Group received £654 million in cash consideration for 4.99% of such shareholding, with the Groups remaining 0.61% direct shareholding to be transferred by November 2008. The gain on disposal amounted to £250 million.
12 Related party transactions
Transactions between the Company and its subsidiaries, joint ventures and associates represent related party transactions. Transactions with subsidiaries have been eliminated on consolidation. Transactions between the Company and its joint ventures are not material to the extent that they have not been eliminated through proportionate consolidation. Except as disclosed below, no material related party transactions have been entered into, during the period, which might reasonably affect any decisions made by users of these Condensed Consolidated Financial Statements.
|
|
Six
months to |
|
|
Six
months to |
|
|
Year
ended |
|
|
Transactions with associated undertakings: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
- Sales of goods and services |
|
113 |
|
|
160 |
|
|
245 |
|
|
|
|
|
|
|
|
|
|
|
|
|
- Purchase of goods and services |
|
130 |
|
|
163 |
|
|
295 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Amounts
owed to joint ventures included within |
|
1,021 |
|
|
575 |
|
|
842 |
|
|
In the six months ended 30 September 2007, the Group made contributions to defined benefit pension schemes of £31 million (six months ended 30 September 2006: £30 million, year ended 31 March 2007: £55 million).
Compensation paid to the Companys Board of directors and members of the Executive Committee will be disclosed in the Groups Annual Report for the year ending 31 March 2008.
31
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
13 Other matters
Contingent liabilities
There have been no material changes to the Groups contingent liabilities relating to performance bonds and credit guarantees in the six months ended 30 September 2007. There have been no changes to any legal or arbitration proceedings involving the Group in the six months ended 30 September 2007 which are expected to have, or have had, a material effect on the financial position or profitability of the Group.
Companies in the Group have received notices from the Indian tax authorities alleging possible liability for failure to deduct withholding tax from consideration paid to Hutchison Telecommunications International Limited (HTIL) in respect of HTILs gain on its disposal to Vodafone of companies with interests in Vodafone Essar. Initial hearings have been held before the Indian Courts. At this stage no accurate quantification of any cost which may arise can be made but Vodafone believes that neither it nor any other member of the Group is liable for such withholding tax and intends to defend this position vigorously.
Secured borrowings
The Group has assumed £773 million of secured debt as a result of the acquisition of Vodafone Essar. There are no other material changes to liens or encumbrances on the Groups assets to those disclosed on page 123 of the Groups Annual Report for the year ended 31 March 2007.
Capital commitments
The Groups capital commitments have increased to £1,672 million at 30 September 2007 (31 March 2007: £1,149 million) primarily due to network infrastructure purchase commitments in India.
Purchase commitments
The Groups purchase commitments have increased to £2,332 million at 30 September 2007 (31 March 2007: £1,281 million).
Seasonality or cyclicality of interim operations
The Groups financial results have not, historically, been subject to significant seasonal trends.
Events after the balance sheet date
On 6 October 2007, the Group announced that it had agreed to acquire Tele2 Italia SpA (Tele2 Italy) and Tele2 Telecommunication Services SLU (Tele2 Spain) from Tele2 AB Group for cash consideration of 775 million (£537 million) on a debt free basis.
Tele2 Italy and Tele2 Spain provide nationwide fixed line telecommunications and broadband services. This transaction will enable the Group to benefit from the high growth broadband markets in two of Vodafones key European markets.
The transaction is expected to be completed by the end of the calendar year, following the receipt of relevant regulatory approval.
Issuances and repayment of debt
See Cash flows and funding on pages 17 to 18 for details of issuances and repayment of debt.
14 Summary of differences between IFRS and US GAAP
Change in accounting principle income taxes
On 1 April 2007, the Group adopted FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes - an interpretation of SFAS 109 (FIN 48). FIN 48 has no impact on the IFRS accounting for tax uncertainties, nor on the Groups expectations for eventual cash settlements, as the latter are not based on accounting principles.
FIN 48 provides guidance on the amounts to be reported in financial statements in respect of uncertain tax positions, which may be different from the amounts included in tax returns. Measurement of uncertain tax positions under FIN 48 is based on a cumulative probability that takes into consideration all possible resolutions. Under IFRS, the Group measures its liability for tax uncertainties based on managements best estimate of the most likely resolution.
Upon adoption of FIN 48, the Group recognised a decrease of £324 million in its US Generally Accepted Accounting Principles (US GAAP) provisions for uncertain tax positions, including an increase of £4 million in respect of entities accounted for using the equity method and a decrease of £99 million in the associated interest accrual. These have been accounted as adjustments to US GAAP retained earnings.
At 1 April 2007, the Group's US GAAP unrecognised tax benefits amounted to £6,291 million in respect of a number of uncertain tax positions, including the ongoing Controlled Foreign Company (CFC) enquiry in the UK. Additionally, £13,592 million was unrecognised for the uncertain tax effect of losses in respect of a write down in the value of investments in Germany. These uncertainties are described further on pages 105 to 106 of the Groups Annual Report for the year ended 31 March 2007. If these benefits were recognised, £4,779 million (plus £13,592 million for the German write down) would have a favourable effect on the US GAAP effective tax rate, while the remaining amounts would impact US GAAP equity or goodwill or are related to temporary differences for which offsetting deductions are available.
32
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2007
14 Summary of differences between IFRS and US GAAP (continued)
The Group is subject to ongoing examination by the tax authorities of the various jurisdictions in which it operates and it is difficult to predict the ultimate outcome or the timing of resolution for uncertain tax positions. At 1 April 2007, it was considered reasonably possible that the Groups US GAAP balance for uncertain tax positions could decrease by £400 million to £625 million within the current financial year as a result of the potential resolution of historic issues with the relevant tax authorities or expiry of statutes of limitations. Other factors that could be reasonably expected to affect the amount of provisions this year and in future years are the emergence of new uncertain tax positions and new information regarding existing tax positions.
Since the date of adoption, the German tax rate has decreased, causing the unrecognised tax benefit of £13,592 million at 1 April 2007 in respect of the German write down to decrease by approximately £3 billion.
The following tax years remain open pursuant to the statute of limitations in Vodafone's major jurisdictions. It is not possible to conclude when settlement will be reached on these open years, nor the likely settlement amount:
UK |
2000 onwards |
Germany |
1999 onwards |
Italy |
2002 onwards |
Spain |
2004 onwards |
USA (federal) |
2003 onwards |
It is the Group's policy to recognise interest accrued in respect of unrecognised tax benefits within interest expense and any accrued penalties within the tax expense. As at the date of adoption of FIN 48 the Group held US GAAP accruals for interest of £1,098 million.
Reconciliations to US GAAP
The Condensed Consolidated Financial Statements have been prepared in accordance with IFRS, which differ in certain significant respects from US GAAP. The following table summarises the effects of the adjustments from IFRS to US GAAP. Further details on the nature of the adjustments can be found on pages 138 to 142 in the Groups Annual Report for the year ended 31 March 2007.
|
|
30
September |
|
|
30
September |
|
|
31
March |
|
|
Revenue (IFRS) |
|
16,994 |
|
|
15,594 |
|
|
31,104 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to derive US GAAP revenue: |
|
|
|
|
|
|
|
|
|
|
Discontinued operations |
|
- |
|
|
(31 |
) |
|
(31 |
) |
|
Basis of consolidation |
|
(3,041 |
) |
|
(3,139 |
) |
|
(6,232 |
) |
|
Connection revenue |
|
- |
|
|
170 |
|
|
518 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue (US GAAP) |
|
13,953 |
|
|
12,594 |
|
|
25,359 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit/(loss) for the period (IFRS) |
|
3,327 |
|
|
(5,039 |
) |
|
(5,297 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to derive US GAAP net loss: |
|
|
|
|
|
|
|
|
|
|
Investments accounted for under the equity method |
|
(1,980 |
) |
|
(733 |
) |
|
680 |
|
|
Connection revenue and costs |
|
- |
|
|
2 |
|
|
5 |
|
|
Goodwill and other intangible assets |
|
(6,543 |
) |
|
(6,681 |
) |
|
(13,352 |
) |
|
Impairment losses |
|
- |
|
|
6,700 |
|
|
6,700 |
|
|
Amortisation of capitalised interest |
|
(56 |
) |
|
(54 |
) |
|
(107 |
) |
|
Interest capitalised during the period |
|
28 |
|
|
23 |
|
|
52 |
|
|
Other |
|
30 |
|
|
670 |
|
|
1,261 |
|
|
Income taxes |
|
4,756 |
|
|
2,650 |
|
|
5,862 |
|
|
Minority interests |
|
(37 |
) |
|
(66 |
) |
|
(129 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss (US GAAP) |
|
(475 |
) |
|
(2,528 |
) |
|
(4,325 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Total equity (IFRS) |
|
70,128 |
|
|
67,573 |
|
|
67,293 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjustments to derive US GAAP shareholders equity: |
|
|
|
|
|
|
|
|
|
|
Investments accounted for under the equity method |
|
(3,184 |
) |
|
(2,883 |
) |
|
(1,070 |
) |
|
Connection revenue and costs |
|
|
|
|
(3 |
) |
|
|
|
|
Goodwill and other intangible assets |
|
19,492 |
|
|
32,232 |
|
|
25,515 |
|
|
Capitalised interest |
|
1,334 |
|
|
1,382 |
|
|
1,342 |
|
|
Other |
|
(1,615 |
) |
|
60 |
|
|
86 |
|
|
Income taxes |
|
(16,920 |
) |
|
(25,382 |
) |
|
(21,859 |
) |
|
Minority interests |
|
1,277 |
|
|
(197 |
) |
|
(226 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders equity (US GAAP) |
|
70,512 |
|
|
72,782 |
|
|
71,081 |
|
|
33
INDEPENDENT REVIEW REPORT BY DELOITTE & TOUCHE LLP TO VODAFONE GROUP PLC
Introduction
We have been engaged by the Company to review the Condensed Consolidated Financial Statements in the half-yearly financial report for the six months ended 30 September 2007 which comprise the consolidated income statement, the consolidated balance sheet, the consolidated statement of recognised income and expense, the consolidated cash flow statement and related notes 1 to 14. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the Condensed Consolidated Financial Statements.
This report is made solely to the Company in accordance with International Standard on Review Engagements 2410 issued by the Auditing Practices Board. Our work has been undertaken so that we might state to the Company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company, for our review work, for this report, or for the conclusions we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdoms Financial Services Authority.
The annual financial statements of the Group are prepared in accordance with IFRS as adopted by the European Union. As disclosed in note 1, the Condensed Consolidated Financial Statements included in this half-yearly financial report have been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting (IAS 34) as adopted by the European Union and as issued by the International Accounting Standards Board.
Our responsibility
Our responsibility is to express to the Company a conclusion on the Condensed Consolidated Financial Statements in the half-yearly financial report based on our review.
Scope of review
We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
IFRS conclusions
Based on our review, nothing has come to our attention that causes us to believe that the accompanying Condensed Consolidated Financial Statements are not prepared, in all material respects, in accordance with IAS 34 as adopted by the European Union and as issued by the International Accounting Standards Board, and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority.
US GAAP
IFRS, both as adopted by the European Union and as issued by the International Accounting Standards Board, vary in significant respects from the accounting principles generally accepted in the United States of America. Information relating to the nature and effect of such differences is presented in note 14 to the Condensed Consolidated Financial Statements.
Deloitte & Touche LLP
Chartered Accountants
London, United Kingdom
13 November 2007
34
1) Copies of this document are available from the Companys registered office:
Vodafone
House
The Connection
Newbury
Berkshire
RG14 2FN
2) This half-yearly financial report will be available on the Vodafone Group Plc website, www.vodafone.com, from 13 November 2007.
For further information:
Vodafone Group Plc
Investor Relations |
Media Relations |
Telephone: +44 (0) 1635 664447 |
Telephone: +44 (0) 1635 664444 |
High resolution photographs are available to the media free of charge at www.fovea.tv.
Vodafone, Vodafone Mobile Connect, Vodafone Mobile Connect USB Modem, Vodafone Mobile Connect Card with 3G broadband, Vodafone Mobile Connect 3G/GPRS data card, Vodacom, ihug, Vodafone at Home, Vodafone Office, Vodafone live! and Vodafone Passport are trademarks of the Vodafone Group. Other product and company names mentioned herein may be the trademarks of their respective owners.
DEFINITION OF TERMS
Term |
Definition |
|
|
Change at constant exchange rates |
Change calculated by restating the prior periods results as if they had been generated at the current periods exchange rates. |
For definitions of other terms please refer to page 159 of the Groups Annual Report for the year ended 31 March 2007.
Copyright © Vodafone Group 2007
35
FORWARD-LOOKING STATEMENTS
This document contains forward-looking statements within the meaning of the US Private Securities Litigation Reform Act of 1995 with respect to the Groups financial condition, results of operations and businesses and certain of the Groups plans and objectives.
In particular, such forward-looking statements include statements with respect to Vodafones expectations as to launch and roll out dates for products, services or technologies offered by Vodafone; intentions regarding the development of products and services introduced by Vodafone or by Vodafone in conjunction with initiatives with third parties; the ability to integrate all operations throughout the Group; the development and impact of new mobile technology; anticipated benefits to the Group from core cost reduction programmes, outsourcing, supply chain management and IT operations initiatives; growth in customers and usage, including improvements in customer mix; the Groups expectations for revenue, operating profit, depreciation and amortisation charges, capitalised fixed asset additions, free cash flow, cash payments for tax and associated interest and effective tax rate contained within the outlook statement on page 5 of this document and under improved outlook on page 1 of this document, and expectations for the Groups future performance generally, including average revenue per user, costs, capital expenditures, operating expenditures and margins and the contribution to the Groups revenue of data services, broadband services, fixed location pricing and mobile advertising; the rate of dividend growth by the Group or its existing investments; expectations regarding the Groups access to adequate funding for its working capital requirements; expected effective tax rates and expected tax payments; the ability to realise synergies through cost savings, revenue generating services, benchmarking and operational experience; future acquisitions, including increases in ownership in existing investments, the timely completion of pending acquisition transactions and pending offers for investments; future disposals; the management of the Groups portfolio; mobile penetration and coverage rates; the impact of regulatory and legal proceedings involving Vodafone and of scheduled or potential regulatory changes; expectations with respect to long term shareholder value growth; Vodafones ability to be the mobile market leader, overall market trends and other trend projections.
Forward-looking statements are sometimes, but not always, identified by their use of a date in the future or such words as anticipates, aims, could, may, should, expects, believes, intends, plans or targets. By their nature, forward-looking statements are inherently predictive, speculative and involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements. These factors include, but are not limited to, the following: changes in economic or political conditions in markets served by operations of the Group that would adversely affect the level of demand for mobile services; greater than anticipated competitive activity, from both existing competitors and new market entrants, including Mobile Virtual Network Operators, which could require changes to the Groups pricing models, lead to customer churn and make it more difficult to acquire new customers, and reduce profitability; the impact of investment in network capacity and the deployment of new technologies, or the rapid obsolescence of existing technology; slower than expected customer growth and reduced customer retention; changes in the spending patterns of new and existing customers; the possibility that new products and services will not be commercially accepted or perform according to expectations or that vendors performance in marketing these technologies will not meet the Groups requirements; the Groups ability to win 3G licence allocations; the Groups ability to realise expected synergies and benefits associated with 3G technologies; a lower than expected impact of new or existing products, services or technologies on the Groups future revenue, cost structure and capital expenditure outlays; the ability of the Group to harmonise mobile platforms and delays, impediments or other problems associated with the roll out and scope of and other new or existing products, services or technologies in new markets; the ability of the Group to offer new services and secure the timely delivery of high quality, reliable GPRS and 3G handsets, network equipment and other key products from suppliers; the Groups ability to develop competitive data content and services that will attract new customers and increase average usage; future revenue contributions of both voice and non-voice services; greater than anticipated prices of new mobile handsets; changes in the costs to the Group of or the rates the Group may charge for terminations and roaming minutes; the Groups ability to achieve meaningful cost savings and revenue improvements as a result of its cost reduction programmes and outsourcing initiatives; the ability to realise benefits from entering into partnerships for developing data and internet services and entering into service franchising and brand licensing; the possibility that the pursuit of new, unexpected strategic opportunities may have a negative impact on the Groups financial performance; developments in the Groups financial condition, earnings and distributable funds and other factors that the Board of Directors takes into account in determining the level of dividends; any unfavourable conditions, regulatory or otherwise, imposed in connection with pending or future acquisitions or dispositions and the integration of acquired companies in the Groups existing operations; the risk that, upon obtaining control of certain investments, the Group discovers additional information relating to the businesses of that investment leading to restructuring charges or write-offs or with other negative implications; changes in the regulatory framework in which the Group operates, including possible action by regulators in markets in which the Group operates or by the EU regulating rates the Group is permitted to charge; the impact of legal or other proceedings against the Group or other companies in the mobile telecommunications industry; the possibility that new marketing or usage stimulation campaigns or efforts and customer retention schemes are not an effective expenditure; the possibility that the Groups integration efforts do not reduce the time to market for new products or improve the Groups cost position; loss of suppliers or disruption of supply chains; the Groups ability to satisfy working capital requirements through borrowing in capital markets, bank facilities and operations; changes in exchange rates, including particularly the exchange rate of pounds sterling to the euro and the US dollar; changes in statutory tax rates and profit mix which would impact the weighted average tax rate; changes in tax legislation in the jurisdictions in which the Group operates; and final resolution of open issues which might impact the effective tax rate; timing of tax payments relating to the resolution of open issues.
Furthermore, a review of the reasons why actual results and developments may differ materially from the expectations disclosed or implied within forward-looking statements can be found under Risk Factors, Seasonality and Outlook Risk Factors in Vodafone Group Plcs Annual Report for the year ended 31 March 2007. All subsequent written or oral forward-looking statements attributable to the Company or any member of the Group or any persons acting on their behalf are expressly qualified in their entirety by the factors referred to above. No assurances can be given that the forward-looking statements in this document will be realised. Neither Vodafone nor any of its affiliates intends to update these forward-looking statements.
36
USE OF NON-GAAP FINANCIAL INFORMATION
In presenting and discussing the Groups reported financial position, operating results and cash flows, certain information is derived from amounts calculated in accordance with IFRS but this information is not itself an expressly permitted GAAP measure. Such non-GAAP measures should not be viewed in isolation as alternatives to the equivalent GAAP measure.
A summary of certain non-GAAP measures included in this results announcement, together with details where additional information and reconciliation to the nearest equivalent GAAP measure can be found, is shown below.
Non-GAAP measure |
|
Equivalent GAAP measure |
|
Location in this results announcement of |
EBITDA |
|
Operating profit/(loss) |
|
Group Results on page 6 |
|
|
|
|
|
|
|
|
|
|
Adjusted operating profit |
|
Operating profit/(loss) |
|
Group Results on page 6 |
|
|
|
|
|
Adjusted profit before tax |
|
Profit/(loss) before tax |
|
Taxation on page 8 |
|
|
|
|
|
Adjusted profit from continuing operations attributable to equity shareholders |
|
Profit/(loss) from continuing operations attributable to equity shareholders |
|
Earnings/(loss) per share on page 8 |
|
|
|
|
|
Adjusted earnings per share |
|
Basic earnings/(loss) per share |
|
Earnings/(loss) per share on page 8 |
|
|
|
|
|
Operating free cash flow |
|
Net cash flows from operating activities |
|
Cash flows and funding beginning on page 17 |
|
|
|
|
|
Free cash flow |
|
Net cash flows from operating activities |
|
Cash flows and funding beginning on page 17 |
|
|
|
|
|
Net debt |
|
Borrowings |
|
Cash flows and funding beginning on page 17 |
|
|
|
|
|
Adjusted effective tax rate |
|
Income tax expense as a percentage of profit/(loss) before taxation |
|
Taxation on page 8 |
37
ADDITIONAL INVESTOR INFORMATION AND KEY PERFORMANCE INDICATORS
REGIONAL ANALYSIS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER
|
|
Revenue |
|
|
EBITDA |
|
|
Adjusted operating profit/(loss) |
|
|
Capitalised fixed asset additions |
|
|
Operating free cash flow |
|
|
||||||||||
|
|
2007 |
|
2006 |
|
|
2007 |
|
2006 |
|
|
2007 |
|
2006 |
|
|
2007 |
|
2006 |
|
|
2007 |
|
2006 |
|
|
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
EUROPE |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
2,650 |
|
2,827 |
|
|
1,150 |
|
1,263 |
|
|
644 |
|
724 |
|
|
167 |
|
198 |
|
|
1,100 |
|
990 |
|
|
Italy |
|
2,097 |
|
2,174 |
|
|
1,036 |
|
1,128 |
|
|
776 |
|
839 |
|
|
145 |
|
184 |
|
|
837 |
|
878 |
|
|
Spain |
|
2,439 |
|
2,268 |
|
|
949 |
|
813 |
|
|
715 |
|
585 |
|
|
194 |
|
213 |
|
|
595 |
|
432 |
|
|
UK |
|
2,717 |
|
2,549 |
|
|
734 |
|
785 |
|
|
243 |
|
318 |
|
|
216 |
|
305 |
|
|
430 |
|
393 |
|
|
Arcor |
|
768 |
|
706 |
|
|
138 |
|
126 |
|
|
92 |
|
83 |
|
|
94 |
|
76 |
|
|
1 |
|
(16 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Greece |
|
599 |
|
636 |
|
|
210 |
|
250 |
|
|
130 |
|
167 |
|
|
66 |
|
74 |
|
|
159 |
|
160 |
|
|
Netherlands |
|
628 |
|
600 |
|
|
214 |
|
176 |
|
|
141 |
|
102 |
|
|
41 |
|
50 |
|
|
139 |
|
136 |
|
|
Portugal |
|
502 |
|
466 |
|
|
186 |
|
168 |
|
|
122 |
|
107 |
|
|
42 |
|
44 |
|
|
87 |
|
101 |
|
|
Other(1) |
|
514 |
|
514 |
|
|
217 |
|
225 |
|
|
406 |
|
436 |
|
|
30 |
|
55 |
|
|
159 |
|
146 |
|
|
|
|
2,243 |
|
2,216 |
|
|
827 |
|
819 |
|
|
799 |
|
812 |
|
|
179 |
|
223 |
|
|
544 |
|
543 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Intra-region revenue |
|
(245 |
) |
(256 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Europe |
|
12,669 |
|
12,484 |
|
|
4,834 |
|
4,934 |
|
|
3,269 |
|
3,361 |
|
|
995 |
|
1,199 |
|
|
3,507 |
|
3,220 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMAPA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Romania |
|
405 |
|
355 |
|
|
195 |
|
175 |
|
|
86 |
|
68 |
|
|
57 |
|
82 |
|
|
149 |
|
121 |
|
|
Turkey(2) |
|
558 |
|
283 |
|
|
102 |
|
65 |
|
|
18 |
|
(18 |
) |
|
97 |
|
36 |
|
|
(73 |
) |
134 |
|
|
Other |
|
561 |
|
524 |
|
|
181 |
|
164 |
|
|
67 |
|
68 |
|
|
70 |
|
95 |
|
|
140 |
|
84 |
|
|
|
|
1,524 |
|
1,162 |
|
|
478 |
|
404 |
|
|
171 |
|
118 |
|
|
224 |
|
213 |
|
|
216 |
|
339 |
|
|
Middle East, Africa and Asia |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Egypt |
|
443 |
|
355 |
|
|
223 |
|
198 |
|
|
158 |
|
155 |
|
|
114 |
|
66 |
|
|
146 |
|
137 |
|
|
India(3) |
|
723 |
|
|
|
|
246 |
|
|
|
|
(18 |
) |
|
|
|
389 |
|
|
|
|
20 |
|
|
|
|
Vodacom |
|
768 |
|
727 |
|
|
269 |
|
261 |
|
|
164 |
|
152 |
|
|
62 |
|
92 |
|
|
125 |
|
139 |
|
|
Other(4) |
|
85 |
|
165 |
|
|
38 |
|
72 |
|
|
26 |
|
32 |
|
|
37 |
|
83 |
|
|
9 |
|
15 |
|
|
|
|
2,019 |
|
1,247 |
|
|
776 |
|
531 |
|
|
330 |
|
339 |
|
|
602 |
|
241 |
|
|
300 |
|
291 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pacific |
|
758 |
|
666 |
|
|
174 |
|
165 |
|
|
63 |
|
66 |
|
|
91 |
|
104 |
|
|
29 |
|
61 |
|
|
Associates - US |
|
|
|
|
|
|
|
|
|
|
|
1,180 |
|
1,015 |
|
|
|
|
|
|
|
|
|
|
|
|
Associates - other |
|
|
|
|
|
|
|
|
|
|
|
|
|
106 |
|
|
|
|
|
|
|
|
|
|
|
|
Total EMAPA |
|
4,301 |
|
3,075 |
|
|
1,428 |
|
1,100 |
|
|
1,744 |
|
1,644 |
|
|
917 |
|
558 |
|
|
545 |
|
691 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Common functions |
|
80 |
|
86 |
|
|
303 |
|
208 |
|
|
210 |
|
136 |
|
|
70 |
|
67 |
|
|
86 |
|
110 |
|
|
Inter-region revenue |
|
(56 |
) |
(51 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Group |
|
16,994 |
|
15,594 |
|
|
6,565 |
|
6,242 |
|
|
5,223 |
|
5,141 |
|
|
1,982 |
|
1,824 |
|
|
4,138 |
|
4,021 |
|
|
Notes:
(1) |
Includes elimination of £5 million (2006: £5 million) of intercompany revenue between operating companies within the Other Europe segment. |
(2) |
Presents the results from 24 May 2006, being the acquisition date. |
(3) |
Presents the results of Vodafone Essar from 8 May 2007, being the acquisition date. |
(4) |
Includes the results of Bharti Airtel. |
See page 35 for definition of terms and page 37 for use of non-GAAP financial information.
38
REGIONAL RESULTS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER
Group
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
||||||||
|
|
30 June |
|
30 September |
|
|
30 June |
|
30 September |
|
|
|
|
30 June |
|
|
|
|
30 September |
|
|
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
|
£ |
|
Organic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
8,253 |
|
8,741 |
|
|
7,679 |
|
7,915 |
|
|
7.5 |
|
4.0 |
|
|
10.4 |
|
4.8 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice revenue(1) |
|
5,904 |
|
6,256 |
|
|
5,574 |
|
5,743 |
|
|
5.9 |
|
1.1 |
|
|
8.9 |
|
1.1 |
|
|
Messaging revenue |
|
950 |
|
998 |
|
|
851 |
|
935 |
|
|
11.6 |
|
9.5 |
|
|
6.7 |
|
7.5 |
|
|
Data revenue |
|
452 |
|
515 |
|
|
334 |
|
316 |
|
|
35.3 |
|
32.2 |
|
|
63.0 |
|
58.5 |
|
|
Fixed line revenue(1) |
|
402 |
|
400 |
|
|
383 |
|
387 |
|
|
5.0 |
|
11.5 |
|
|
3.4 |
|
8.3 |
|
|
Other service revenue |
|
5 |
|
5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service revenue |
|
7,713 |
|
8,174 |
|
|
7,142 |
|
7,381 |
|
|
8.0 |
|
4.2 |
|
|
10.7 |
|
4.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
||||||||
|
|
30 June |
|
30 September |
|
|
30 June |
|
30 September |
|
|
|
|
30 June |
|
|
|
|
30 September |
|
|
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
|
£ |
|
Organic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
6,219 |
|
6,450 |
|
|
6,220 |
|
6,264 |
|
|
|
|
1.1 |
|
|
3.0 |
|
3.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice revenue(1) |
|
4,292 |
|
4,412 |
|
|
4,445 |
|
4,475 |
|
|
(3.4 |
) |
(2.4 |
) |
|
(1.4 |
) |
(1.4 |
) |
|
Messaging revenue |
|
764 |
|
811 |
|
|
711 |
|
747 |
|
|
7.5 |
|
8.5 |
|
|
8.6 |
|
8.7 |
|
|
Data revenue |
|
398 |
|
445 |
|
|
312 |
|
291 |
|
|
27.6 |
|
28.9 |
|
|
52.9 |
|
53.0 |
|
|
Fixed line revenue(1) |
|
391 |
|
389 |
|
|
364 |
|
367 |
|
|
7.4 |
|
8.7 |
|
|
6.0 |
|
6.4 |
|
|
Other service revenue |
|
5 |
|
6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service revenue |
|
5,850 |
|
6,063 |
|
|
5,832 |
|
5,880 |
|
|
0.3 |
|
1.4 |
|
|
3.1 |
|
3.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
||||||||
|
|
30 June |
|
30 September |
|
|
30 June |
|
30 September |
|
|
|
|
30 June |
|
|
|
|
30 September |
|
|
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
|
£ |
|
Organic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
1,238 |
|
1,277 |
|
|
1,339 |
|
1,351 |
|
|
(7.5 |
) |
(6.3 |
) |
|
(5.5 |
) |
(5.5 |
) |
|
Italy |
|
1,005 |
|
1,020 |
|
|
1,051 |
|
1,045 |
|
|
(4.4 |
) |
(3.1 |
) |
|
(2.4 |
) |
(2.3 |
) |
|
Spain |
|
1,110 |
|
1,141 |
|
|
1,001 |
|
1,049 |
|
|
10.9 |
|
12.5 |
|
|
8.8 |
|
8.9 |
|
|
UK |
|
1,209 |
|
1,294 |
|
|
1,153 |
|
1,192 |
|
|
4.9 |
|
4.9 |
|
|
8.6 |
|
8.5 |
|
|
Arcor |
|
375 |
|
383 |
|
|
346 |
|
351 |
|
|
8.4 |
|
9.9 |
|
|
9.1 |
|
9.3 |
|
|
Other |
|
1,028 |
|
1,076 |
|
|
1,036 |
|
1,054 |
|
|
(0.8 |
) |
0.6 |
|
|
2.1 |
|
2.1 |
|
|
Eliminations |
|
(115 |
) |
(128 |
) |
|
(94 |
) |
(162 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
5,850 |
|
6,063 |
|
|
5,832 |
|
5,880 |
|
|
0.3 |
|
1.4 |
|
|
3.1 |
|
3.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMAPA
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
||||||||
|
|
30 June |
|
30 September |
|
|
30 June |
|
30 September |
|
|
|
|
30 June |
|
|
|
|
30 September |
|
|
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
|
£ |
|
Organic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
|
2,021 |
|
2,280 |
|
|
1,436 |
|
1,639 |
|
|
40.7 |
|
18.7 |
|
|
39.1 |
|
13.5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Voice revenue(1) |
|
1,631 |
|
1,868 |
|
|
1,143 |
|
1,288 |
|
|
42.7 |
|
16.4 |
|
|
45.0 |
|
11.7 |
|
|
Messaging revenue |
|
189 |
|
188 |
|
|
142 |
|
189 |
|
|
33.1 |
|
15.6 |
|
|
(0.5 |
) |
1.3 |
|
|
Data revenue |
|
55 |
|
72 |
|
|
25 |
|
31 |
|
|
120.0 |
|
64.5 |
|
|
132.3 |
|
101.7 |
|
|
Fixed line revenue(1) |
|
11 |
|
11 |
|
|
19 |
|
20 |
|
|
(42.1 |
) |
740.7 |
|
|
(45.0 |
) |
232.3 |
|
|
Service revenue |
|
1,886 |
|
2,139 |
|
|
1,329 |
|
1,528 |
|
|
41.9 |
|
18.2 |
|
|
40.0 |
|
13.2 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
Quarter ended |
|
|
||||||||
|
|
30 June |
|
30 September |
|
|
30 June |
|
30 September |
|
|
|
|
30 June |
|
|
|
|
30 September |
|
|
|
|
£m |
|
£m |
|
|
£m |
|
£m |
|
|
£ |
|
Organic |
|
|
£ |
|
Organic |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Service revenue |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
714 |
|
759 |
|
|
477 |
|
646 |
|
|
49.7 |
|
12.9 |
|
|
17.5 |
|
9.2 |
|
|
Middle East, Africa & Asia |
|
837 |
|
1,044 |
|
|
559 |
|
579 |
|
|
49.7 |
|
28.9 |
|
|
80.3 |
|
21.6 |
|
|
Pacific |
|
335 |
|
336 |
|
|
293 |
|
303 |
|
|
14.3 |
|
9.5 |
|
|
10.9 |
|
5.5 |
|
|
|
|
1,886 |
|
2,139 |
|
|
1,329 |
|
1,528 |
|
|
41.9 |
|
18.2 |
|
|
40.0 |
|
13.2 |
|
|
Note:
(1) Revenue relating to fixed line activities provided by mobile operators, previously classified within voice revenue, is now presented as fixed line revenue, together with revenue from fixed line operators and DSL. All prior periods have been adjusted accordingly.
39
RECONCILIATION OF ADJUSTED EARNINGS
FOR THE SIX MONTHS ENDED 30 SEPTEMBER
|
|
Reported |
|
Adjustments |
|
Adjusted |
|
|
30 September 2007 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit |
|
5,208 |
|
15 |
(1) |
5,223 |
|
|
|
|
|
|
|
|
|
|
|
Non-operating income and expense |
|
250 |
|
(250 |
)(2) |
|
|
|
Investment income and financing costs |
|
(898 |
) |
376 |
(3) |
(522 |
) |
|
Profit before taxation |
|
4,560 |
|
141 |
|
4,701 |
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
(1,233 |
) |
(34) |
(4) |
(1,267 |
) |
|
Profit for the period |
|
3,327 |
|
107 |
|
3,434 |
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
Equity shareholders |
|
3,290 |
|
107 |
|
3,397 |
|
|
Minority interests |
|
37 |
|
|
|
37 |
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share from continuing operations |
|
6.22p |
|
|
|
6.42p |
|
|
Notes:
(1) |
Consists of a £15 million adjustment relating to other income and expense. |
(2) |
Adjustment relates to the profit on disposal of a stake in Bharti Airtel. |
(3) |
Includes a £286 million adjustment in relation to the change in fair value of equity put rights and similar arrangements (see note 2 in investment income and financing costs on page 7), and a £90 million adjustment in relation to foreign exchange on certain intercompany balances, and on financial instruments received as consideration in the disposal of Vodafone Japan to SoftBank, which completed in April 2006. |
(4) |
Represents a £15 million adjustment relating to the recognition of a pre-acquisition deferred tax asset and a £19 million adjustment relating to tax on the adjustments used to derive adjusted profit before tax. |
|
|
Reported |
|
Adjustments |
|
Adjusted |
|
|
30 September 2006 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating (loss)/profit |
|
(2,952 |
) |
8,093 |
(1) |
5,141 |
|
|
|
|
|
|
|
|
|
|
|
Non-operating income and expense |
|
10 |
|
(10 |
) |
|
|
|
Investment income and financing costs |
|
(388 |
) |
(29 |
)(2) |
(417 |
) |
|
(Loss)/profit before taxation |
|
(3,330 |
) |
8,054 |
|
4,724 |
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
(1,218 |
) |
(2 |
)(3) |
(1,220 |
) |
|
(Loss)/profit for the period from continuing operations |
|
(4,548 |
) |
8,052 |
|
3,504 |
|
|
|
|
|
|
|
|
|
|
|
Loss for the period from discontinued operations |
|
(491 |
) |
491 |
(4) |
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)/profit for the period |
|
(5,039 |
) |
8,543 |
|
3,504 |
|
|
|
|
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
|
|
Equity shareholders |
|
(5,105 |
) |
8,546 |
|
3,441 |
|
|
Minority interests |
|
66 |
|
(3 |
) |
63 |
|
|
|
|
|
|
|
|
|
|
|
Basic (loss)/earnings per share from continuing operations |
|
(8.02 |
)p |
|
|
5.98p |
|
|
Notes:
(1) |
Adjustments relate to impairment losses of £8,100 million (Germany: £6,700 million and Italy £1,400 million), less a £6 million adjustment related to the share of associated undertakings non-operating income and less a £1 million adjustment relating to other income and expense. |
(2) |
Includes a £21 million adjustment in relation to the change in fair value of equity put rights and similar arrangements as well as an £8 million adjustment in relation to foreign exchange on certain intercompany balances and on financial instruments received as consideration in the disposal of Vodafone Japan to SoftBank, which completed in April 2006. |
(3) |
Represents tax on the adjustments used to derive adjusted profit before tax. |
(4) |
Adjustment relates to the loss for the period attributable to Vodafone Japan which was disposed of in April 2006. |
40
SUPPLEMENTARY
CASH FLOW INFORMATION
FOR THE SIX MONTHS ENDED 30 SEPTEMBER
Operating free cash flow to net debt reconciliation
|
|
Six months to £m |
|
Six months to |
|
|
|
|
|
|
|
|
|
Operating free cash flow from continuing operations |
|
4,138 |
|
4,021 |
|
|
Operating free cash flow from discontinued operations |
|
- |
|
(8 |
) |
|
|
|
|
|
|
|
|
Taxation |
|
(1,487 |
) |
(1,217 |
) |
|
Dividends received from associated undertakings |
|
476 |
|
371 |
|
|
Dividends paid to minority shareholders in subsidiary undertakings |
|
(66 |
) |
(34 |
) |
|
Dividends received from investments |
|
72 |
|
57 |
|
|
Interest received |
|
240 |
|
256 |
|
|
Interest paid |
|
(712 |
) |
(499 |
) |
|
|
|
|
|
|
|
|
Free cash flow |
|
2,661 |
|
2,947 |
|
|
|
|
|
|
|
|
|
Acquisitions and disposals(1) |
|
(5,973 |
) |
4,734 |
|
|
Written put options over minority interests |
|
(2,431 |
) |
523 |
|
|
Equity dividends paid |
|
(2,334 |
) |
(2,315 |
) |
|
Purchase of treasury shares |
|
- |
|
(43 |
) |
|
B share scheme |
|
- |
|
(9,027 |
) |
|
Foreign exchange and other |
|
(127 |
) |
785 |
|
|
|
|
|
|
|
|
|
Net debt increase |
|
(8,204 |
) |
(2,396 |
) |
|
Opening net debt |
|
(15,049 |
) |
(17,833 |
) |
|
|
|
|
|
|
|
|
Closing net debt |
|
(23,253 |
) |
(20,229 |
) |
|
Note:
(1) Includes net cash and cash equivalents paid of £4,724 million and assumed debt of £1,249 million, but excludes liabilities related to written put options over minority interests, which are shown separately.
41
KEY PERFORMANCE INDICATORS - MOBILE TELECOMMUNICATIONS BUSINESSES
MOBILE CUSTOMERS(1) 1 APRIL 2007 TO 30 SEPTEMBER 2007
|
|
QUARTER ENDED 30 JUNE 2007 |
|
|
QUARTER ENDED 30 SEPTEMBER 2007 |
|
||||||||||||||
COUNTRY (in thousands) |
|
AT 1 APR |
|
NET ADDITIONS |
|
OTHER MOVEMENTS(2) |
|
AT 30 JUN 2007 |
|
NET ADDITIONS |
|
OTHER MOVEMENTS(2) |
|
AT 30 SEP 2007 |
|
PREPAID(3) |
||||
Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
Germany |
|
30,818 |
|
800 |
|
- |
|
31,618 |
|
923 |
|
- |
|
32,541 |
|
55.0 |
% |
|||
Italy |
|
21,034 |
|
729 |
|
- |
|
21,763 |
|
644 |
|
- |
|
22,407 |
|
91.7 |
% |
|||
Spain |
|
14,893 |
|
286 |
|
- |
|
15,179 |
|
294 |
|
- |
|
15,473 |
|
43.4 |
% |
|||
UK |
|
|
17,411 |
|
236 |
|
- |
|
17,647 |
|
312 |
|
- |
|
17,959 |
|
|
60.2 |
% |
|
|
|
|
84,156 |
|
2,051 |
|
- |
|
86,207 |
|
2,173 |
|
- |
|
88,380 |
|
|
65.3 |
% |
|
Other Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Albania |
|
|
956 |
|
48 |
|
- |
|
1,004 |
|
71 |
|
- |
|
1,075 |
|
|
96.1 |
% |
|
Greece |
|
|
5,057 |
|
180 |
|
- |
|
5,237 |
|
109 |
|
- |
|
5,346 |
|
|
69.5 |
% |
|
Ireland |
|
|
2,177 |
|
10 |
|
- |
|
2,187 |
|
30 |
|
- |
|
2,217 |
|
|
72.6 |
% |
|
Malta |
|
|
186 |
|
2 |
|
- |
|
188 |
|
9 |
|
- |
|
197 |
|
|
89.9 |
% |
|
Netherlands |
|
|
3,880 |
|
10 |
|
- |
|
3,890 |
|
(23 |
) |
25 |
|
3,892 |
|
|
42.8 |
% |
|
Portugal |
|
|
4,751 |
|
24 |
|
- |
|
4,775 |
|
182 |
|
- |
|
4,957 |
|
|
79.0 |
% |
|
|
|
|
17,007 |
|
274 |
|
- |
|
17,281 |
|
378 |
|
25 |
|
17,684 |
|
|
68.5 |
% |
|
Europe |
|
|
101,163 |
|
2,325 |
|
- |
|
103,488 |
|
2,551 |
|
25 |
|
106,064 |
|
|
65.8 |
% |
|
EMAPA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Czech Republic |
|
|
2,475 |
|
50 |
|
- |
|
2,525 |
|
57 |
|
- |
|
2,582 |
|
|
47.9 |
% |
|
Romania |
|
|
7,954 |
|
269 |
|
- |
|
8,223 |
|
356 |
|
- |
|
8,579 |
|
|
65.9 |
% |
|
Hungary |
|
|
2,163 |
|
1 |
|
- |
|
2,164 |
|
48 |
|
- |
|
2,212 |
|
|
57.5 |
% |
|
Turkey |
|
|
13,900 |
|
1,025 |
|
- |
|
14,925 |
|
1,312 |
|
(528 |
) |
15,709 |
|
|
90.0 |
% |
|
Poland |
|
|
2,483 |
|
50 |
|
- |
|
2,533 |
|
84 |
|
- |
|
2,617 |
|
|
58.2 |
% |
|
|
|
|
28,975 |
|
1,395 |
|
- |
|
30,370 |
|
1,857 |
|
(528 |
) |
31,699 |
|
|
70.9 |
% |
|
Middle East, Africa & Asia |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Egypt |
|
|
9,652 |
|
975 |
|
356 |
|
10,983 |
|
1,203 |
|
- |
|
12,186 |
|
|
95.1 |
% |
|
Kenya |
|
|
2,433 |
|
332 |
|
- |
|
2,765 |
|
418 |
|
- |
|
3,183 |
|
|
98.7 |
% |
|
South Africa(4) |
|
|
15,075 |
|
1,129 |
|
- |
|
16,204 |
|
1,026 |
|
(1,447 |
) |
15,783 |
|
|
88.5 |
% |
|
India |
|
|
- |
|
3,049 |
|
27,703 |
|
30,752 |
|
4,906 |
|
- |
|
35,658 |
|
|
89.0 |
% |
|
|
|
|
27,160 |
|
5,485 |
|
28,059 |
|
60,704 |
|
7,553 |
|
(1,447 |
) |
66,810 |
|
|
90.5 |
% |
|
Pacific |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Australia |
|
|
3,367 |
|
16 |
|
- |
|
3,383 |
|
48 |
|
- |
|
3,431 |
|
|
72.1 |
% |
|
New Zealand |
|
|
2,244 |
|
24 |
|
- |
|
2,268 |
|
(13 |
) |
- |
|
2,255 |
|
|
74.2 |
% |
|
Fiji |
|
|
139 |
|
7 |
|
- |
|
146 |
|
8 |
|
- |
|
154 |
|
|
95.4 |
% |
|
|
|
|
5,750 |
|
47 |
|
- |
|
5,797 |
|
43 |
|
- |
|
5,840 |
|
|
74.1 |
% |
|
EMAPA |
|
|
61,885 |
|
6,927 |
|
28,059 |
|
96,871 |
|
9,453 |
|
(1,975 |
) |
104,349 |
|
|
83.7 |
% |
|
Group |
|
|
163,048 |
|
9,252 |
|
28,059 |
|
200,359 |
|
12,004 |
|
(1,950 |
) |
210,413 |
|
|
75.6 |
% |
|
Reconciliation to proportionate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Minority interests in above |
|
|
(5,904 |
) |
(1,617 |
) |
(9,346 |
) |
(16,867 |
) |
(2,305 |
) |
10 |
|
(19,162 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Associates and investments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
United States |
|
|
27,322 |
|
602 |
|
- |
|
27,924 |
|
739 |
|
1 |
|
28,664 |
|
|
5.2 |
% |
|
Other |
|
|
21,927 |
|
879 |
|
(2,185 |
) |
20,621 |
|
939 |
|
- |
|
21,560 |
|
|
79.9 |
% |
|
|
|
|
49,249 |
|
1,481 |
|
(2,185 |
) |
48,545 |
|
1,678 |
|
1 |
|
50,224 |
|
|
|
|
|
Proportionate(5) |
|
|
206,393 |
|
9,116 |
|
16,528 |
|
232,037 |
|
11,377 |
|
(1,939 |
) |
241,475 |
|
|
71.9 |
% |
|
Europe |
|
|
109,032 |
|
2,356 |
|
- |
|
111,388 |
|
2,607 |
|
25 |
|
114,020 |
|
|
65.8 |
% |
|
EMAPA |
|
97,361 |
|
6,760 |
|
16,528 |
|
120,649 |
|
8,770 |
|
(1,964 |
) |
127,455 |
|
73.0 |
% |
Notes:
(1) Group customers are presented on a controlled (fully consolidated) and jointly controlled (proportionately consolidated) basis in accordance with the Groups current segments.
(2) Other movements relate to the acquisition of Vodafone Essar, the disconnection of inactive SIM cards in Turkey, a share repurchase in Egypt, a change in disconnection policies in Egypt, the Netherlands, Turkey and South Africa as well as the acquisition of a customer base in the United States.
(3) Prepaid customer percentages are calculated on a venture basis. At 30 September 2007, there were 729.2 million venture customers.
(4) South Africa refers to the Groups interests in Vodacom Group (Pty) Limited and its subsidiaries, including those located outside of South Africa.
(5) Proportionate customers are based on equity interests as at 30 September 2007. The calculation of proportionate customers for Vodafone Essar also assumes the exercise of call options that could increase the Groups equity interest from 51.95% to 66.98%. These call options can only be exercised in accordance with Indian law prevailing at the time of exercise.
42
KEY PERFORMANCE INDICATORS - MOBILE TELECOMMUNICATIONS BUSINESSES
MOBILE CUSTOMER CHURN
|
|
|
ANNUALISED CHURN INFORMATION IN THE QUARTER TO |
|
|||||||||||||||||
COUNTRY |
|
|
30 JUN |
|
30 SEP |
|
31 DEC |
|
31 MAR |
|
30 JUN |
|
30 SEP |
|
|||||||
Germany(1) |
Total |
|
|
20.7 |
% |
|
22.1 |
% |
|
20.1 |
% |
|
24.2 |
% |
|
20.7 |
% |
|
20.8 |
% |
|
|
Contract |
|
|
14.6 |
% |
|
13.5 |
% |
|
15.7 |
% |
|
14.9 |
% |
|
14.0 |
% |
|
14.7 |
% |
|
|
Prepaid |
|
|
26.0 |
% |
|
29.5 |
% |
|
23.9 |
% |
|
31.9 |
% |
|
26.4 |
% |
|
26.0 |
% |
|
Italy |
Total |
|
|
20.8 |
% |
|
21.7 |
% |
|
19.4 |
% |
|
20.6 |
% |
|
18.1 |
% |
|
25.0 |
% |
|
|
Contract |
|
|
17.2 |
% |
|
13.6 |
% |
|
14.8 |
% |
|
14.1 |
% |
|
15.9 |
% |
|
14.7 |
% |
|
|
Prepaid |
|
|
21.1 |
% |
|
22.4 |
% |
|
19.8 |
% |
|
21.2 |
% |
|
18.3 |
% |
|
25.9 |
% |
|
Spain(2) |
Total |
|
|
20.5 |
% |
|
37.0 |
% |
|
23.4 |
% |
|
24.7 |
% |
|
22.4 |
% |
|
24.5 |
% |
|
|
Contract |
|
|
12.3 |
% |
|
13.4 |
% |
|
15.3 |
% |
|
16.6 |
% |
|
14.8 |
% |
|
14.6 |
% |
|
|
Prepaid |
|
|
28.9 |
% |
|
62.5 |
% |
|
32.8 |
% |
|
34.5 |
% |
|
31.7 |
% |
|
37.2 |
% |
|
UK |
Total |
|
|
32.8 |
% |
|
37.6 |
% |
|
35.4 |
% |
|
29.8 |
% |
|
34.1 |
% |
|
35.5 |
% |
|
|
Contract |
|
|
20.1 |
% |
|
18.8 |
% |
|
17.9 |
% |
|
17.4 |
% |
|
15.9 |
% |
|
15.3 |
% |
|
|
Prepaid |
|
|
40.9 |
% |
|
49.9 |
% |
|
47.0 |
% |
|
37.9 |
% |
|
46.0 |
% |
|
48.8 |
% |
|
Notes:
(1) The customer churn for Germany in the quarter ended 31 December 2006 benefited from a regulatory driven change in the prepaid disconnection policy, which reduced disconnections by 291,000 in the quarter. The underlying prepaid customer churn, excluding this change, was 31.1% and total churn was 24.0%.
(2) The customer churn for Spain in the quarter ended 30 September 2006 includes the effect of 584,000 disconnections following a change in the application of disconnection policies. The underlying customer churn, excluding these disconnections, was 20.1%.
3G DEVICES(1)
|
|
|
QUARTER ENDED 30 JUNE 2007 |
|
|
QUARTER ENDED 30 SEPTEMBER 2007 |
|
||||||
COUNTRY (in thousands) |
|
|
AT 31 MAR |
|
NET |
|
AT 30 JUN |
|
|
NET |
|
AT 30 SEP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
|
3,720 |
|
476 |
|
4,196 |
|
|
549 |
|
4,745 |
|
Italy |
|
|
3,762 |
|
330 |
|
4,092 |
|
|
608 |
|
4,700 |
|
Spain |
|
|
2,890 |
|
688 |
|
3,578 |
|
|
750 |
|
4,328 |
|
UK |
|
|
1,938 |
|
685 |
|
2,623 |
|
|
472 |
|
3,095 |
|
Other Europe |
|
|
2,353 |
|
236 |
|
2,589 |
|
|
284 |
|
2,873 |
|
Europe |
|
|
14,663 |
|
2,415 |
|
17,078 |
|
|
2,663 |
|
19,741 |
|
EMAPA |
|
|
1,205 |
|
227 |
|
1,432 |
|
|
240 |
|
1,672 |
|
Group |
|
|
15,868 |
|
2,642 |
|
18,510 |
|
|
2,903 |
|
21,413 |
|
Consumer devices |
|
|
14,246 |
|
2,460 |
|
16,706 |
|
|
2,444 |
|
19,150 |
|
Business devices |
|
|
1,622 |
|
182 |
|
1,804 |
|
|
459 |
|
2,263 |
|
Group |
|
|
15,868 |
|
2,642 |
|
18,510 |
|
|
2,903 |
|
21,413 |
|
Note:
(1) 3G devices only include those in the Groups subsidiary and joint venture undertakings. At 30 September 2007, there were an additional 3.2 million (30 June 2007: 3.3 million, 31 March 2007: 3.0 million) registered Vodafone live! with 3G and Vodafone Mobile Connect 3G/GPRS data card venture customers in the Groups associated undertakings.
43
KEY PERFORMANCE INDICATORS - MOBILE TELECOMMUNICATIONS BUSINESSES
MOBILE VOICE USAGE VOLUMES
|
|
|
TOTAL VOICE MINUTES(1) IN THE QUARTER ENDED |
|
||||||||||
COUNTRY (in millions) |
|
|
3O JUN |
|
30 SEP |
|
31 DEC |
|
31 MAR |
|
30 JUN |
|
30 SEP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
|
7,614 |
|
7,979 |
|
8,650 |
|
9,230 |
|
9,897 |
|
10,263 |
|
Italy |
|
|
7,687 |
|
8,050 |
|
8,256 |
|
8,439 |
|
8,932 |
|
9,051 |
|
Spain |
|
|
6,978 |
|
7,533 |
|
7,655 |
|
8,248 |
|
8,530 |
|
8,886 |
|
UK |
|
|
7,207 |
|
7,579 |
|
8,160 |
|
8,790 |
|
8,963 |
|
9,112 |
|
Albania |
|
|
148 |
|
166 |
|
160 |
|
167 |
|
196 |
|
215 |
|
Greece |
|
|
2,075 |
|
2,216 |
|
2,113 |
|
1,985 |
|
2,168 |
|
2,282 |
|
Ireland |
|
|
1,380 |
|
1,422 |
|
1,462 |
|
1,420 |
|
1,490 |
|
1,517 |
|
Malta |
|
|
49 |
|
55 |
|
50 |
|
48 |
|
55 |
|
64 |
|
Netherlands |
|
|
1,820 |
|
1,711 |
|
1,868 |
|
1,900 |
|
2,006 |
|
1,899 |
|
Portugal |
|
|
1,472 |
|
1,606 |
|
1,586 |
|
1,612 |
|
1,657 |
|
1,836 |
|
Europe |
|
|
36,430 |
|
38,317 |
|
39,960 |
|
41,839 |
|
43,894 |
|
45,125 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMAPA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Eastern Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Czech Republic |
|
|
901 |
|
868 |
|
919 |
|
916 |
|
985 |
|
998 |
|
Hungary |
|
|
948 |
|
980 |
|
1,030 |
|
1,030 |
|
1,110 |
|
1,149 |
|
Romania(2) |
|
|
1,873 |
|
2,059 |
|
2,231 |
|
2,339 |
|
2,540 |
|
2,726 |
|
Turkey(3) |
|
|
2,494 |
|
6,451 |
|
5,781 |
|
6,224 |
|
6,583 |
|
6,551 |
|
Joint Venture |
|
|
575 |
|
641 |
|
717 |
|
681 |
|
769 |
|
819 |
|
|
|
|
6,791 |
|
10,999 |
|
10,678 |
|
11,190 |
|
11,987 |
|
12,243 |
|
Middle East, Africa & Asia |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Egypt |
|
|
2,869 |
|
3,462 |
|
3,670 |
|
4,156 |
|
4,794 |
|
5,591 |
|
India(4) |
|
|
- |
|
- |
|
- |
|
- |
|
26,713 |
|
33,897 |
|
Joint Ventures(5) |
|
|
5,160 |
|
5,713 |
|
6,638 |
|
5,781 |
|
3,016 |
|
4,854 |
|
|
|
|
8,029 |
|
9,175 |
|
10,308 |
|
9,937 |
|
34,523 |
|
44,342 |
|
Pacific |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Australia |
|
|
2,006 |
|
2,141 |
|
2,238 |
|
2,222 |
|
2,179 |
|
2,252 |
|
New Zealand |
|
|
597 |
|
597 |
|
672 |
|
771 |
|
793 |
|
834 |
|
Joint Venture |
|
|
28 |
|
33 |
|
34 |
|
32 |
|
38 |
|
42 |
|
|
|
|
2,631 |
|
2,771 |
|
2,944 |
|
3,025 |
|
3,010 |
|
3,128 |
|
EMAPA |
|
|
17,451 |
|
22,945 |
|
23,930 |
|
24,152 |
|
49,520 |
|
59,713 |
|
Group |
|
|
53,881 |
|
61,262 |
|
63,890 |
|
65,991 |
|
93,414 |
|
104,838 |
|
Notes:
(1) |
The total voice minute information presented in the table above represents network minutes, or the volume of minutes handled by each local network, and includes incoming, outgoing and visitor calls. The voice minute information in respect of Germany and New Zealand reflects billed minutes, under which calls are rounded up to the nearest minute under certain tariffs. |
(2) |
During the quarter ended 31 December 2006, Vodafone Romania restated usage volumes for all quarters in the prior year. Previous volumes were billed minutes and this has now been restated to network minutes. |
(3) |
On 24 May 2006, the Group acquired substantially all the assets and business of Telsim Mobil Telekomunikasyon Hizmetleri in Turkey. The quarter ended 30 June 2006 has been restated to include voice minutes from the acquisition date. |
(4) |
Vodafone Essar is included from 8 May 2007, being the date of acquisition. |
(5) |
With effect from the quarter ended 30 September 2007, joint venture minutes within the Middle East, Africa & Asia area include the Groups share of minutes for Vodacom Group (Pty) Limited and its subsidiaries, including those located outside of South Africa. |
44
KEY PERFORMANCE INDICATORS - MOBILE TELECOMMUNICATIONS BUSINESSES
MESSAGING AND DATA AS A PERCENTAGE OF SERVICE REVENUE(1)
|
|
|
QUARTER ENDED 30 SEPTEMBER 2007 |
|
|||||||
COUNTRY |
|
|
MESSAGING |
|
DATA |
|
TOTAL |
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
|
14.0 |
% |
|
10.9 |
% |
|
24.9 |
% |
|
Italy |
|
|
16.3 |
% |
|
6.2 |
% |
|
22.5 |
% |
|
Spain |
|
|
9.4 |
% |
|
7.9 |
% |
|
17.3 |
% |
|
UK |
|
|
17.9 |
% |
|
7.4 |
% |
|
25.3 |
% |
|
Europe |
|
|
13.4 |
% |
|
7.3 |
% |
|
20.7 |
% |
|
EMAPA |
|
|
8.8 |
% |
|
3.4 |
% |
|
12.2 |
% |
|
Group |
|
|
12.2 |
% |
|
6.3 |
% |
|
18.5 |
% |
|
HISTORIC MESSAGING AND DATA INFORMATION
|
|
|
MESSAGING AND DATA AS A PERCENTAGE OF SERVICE REVENUE IN THE QUARTER ENDED(1) |
|
|||||||||||||||
COUNTRY |
|
|
30 JUN |
|
|
30 SEP |
|
|
31 DEC |
|
|
31 MAR |
|
|
30 JUN |
|
|
30 SEP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
|
21.2% |
|
|
21.6% |
|
|
22.9% |
|
|
24.4% |
|
|
24.3% |
|
|
24.9% |
|
Italy |
|
|
17.3% |
|
|
17.5% |
|
|
18.7% |
|
|
20.4% |
|
|
21.2% |
|
|
22.5% |
|
Spain |
|
|
15.7% |
|
|
14.7% |
|
|
15.3% |
|
|
16.0% |
|
|
16.1% |
|
|
17.3% |
|
UK |
|
|
20.9% |
|
|
21.7% |
|
|
23.2% |
|
|
24.3% |
|
|
24.9% |
|
|
25.3% |
|
Europe |
|
|
17.5% |
|
|
17.7% |
|
|
18.7% |
|
|
19.6% |
|
|
19.9% |
|
|
20.7% |
|
EMAPA |
|
|
12.6% |
|
|
14.4% |
|
|
15.0% |
|
|
11.8% |
|
|
12.9% |
|
|
12.2% |
|
Group |
|
|
16.6% |
|
|
16.9% |
|
|
17.9% |
|
|
18.0% |
|
|
18.2% |
|
|
18.5% |
|
Note:
(1) Messaging and data percentages are calculated using service revenue from all businesses within the Group and includes fixed line revenue. Historical data has been recalculated to provide comparative information. Calculations are based on service revenue rounded to the nearest 0.1 million using local currency for individual countries and sterling for regional and Group numbers.
45
KEY PERFORMANCE INDICATORS - MOBILE TELECOMMUNICATIONS BUSINESSES
AVERAGE MONTHLY MOBILE REVENUE PER USER IN THE QUARTER
COUNTRY |
|
|
|
30 JUN |
|
|
30 SEP |
|
|
31 DEC |
|
|
31 MAR |
|
|
30 JUN |
|
|
30 SEP |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Europe |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Germany |
|
Total |
|
22.1 |
|
|
22.4 |
|
|
20.9 |
|
|
19.3 |
|
|
19.5 |
|
|
19.5 |
|
(EUR) |
|
Contract |
|
38.4 |
|
|
39.0 |
|
|
36.7 |
|
|
34.7 |
|
|
34.9 |
|
|
35.3 |
|
|
|
Prepaid |
|
7.6 |
|
|
7.6 |
|
|
7.0 |
|
|
6.1 |
|
|
6.2 |
|
|
6.1 |
|
Italy |
|
Total |
|
27.6 |
|
|
27.1 |
|
|
25.8 |
|
|
23.4 |
|
|
23.2 |
|
|
22.7 |
|
(EUR) |
|
Contract |
|
72.6 |
|
|
68.0 |
|
|
71.1 |
|
|
69.5 |
|
|
69.8 |
|
|
65.2 |
|
|
|
Prepaid |
|
23.3 |
|
|
23.2 |
|
|
21.5 |
|
|
19.1 |
|
|
18.8 |
|
|
18.6 |
|
Spain |
|
Total |
|
35.3 |
|
|
36.4 |
|
|
35.3 |
|
|
33.8 |
|
|
36.3 |
|
|
36.5 |
|
(EUR) |
|
Contract |
|
54.8 |
|
|
55.2 |
|
|
51.3 |
|
|
48.9 |
|
|
52.0 |
|
|
51.7 |
|
|
|
Prepaid |
|
15.0 |
|
|
15.4 |
|
|
16.0 |
|
|
15.0 |
|
|
16.4 |
|
|
16.5 |
|
UK |
|
Total |
|
23.7 |
|
|
24.5 |
|
|
23.6 |
|
|
22.7 |
|
|
23.1 |
|
|
24.1 |
|
(GBP) |
|
Contract |
|
45.2 |
|
|
46.5 |
|
|
43.7 |
|
|
43.4 |
|
|
43.5 |
|
|
45.8 |
|
|
|
Prepaid |
|
8.9 |
|
|
9.4 |
|
|
9.5 |
|
|
8.6 |
|
|
8.9 |
|
|
9.0 |
|
Albania |
|
Total |
|
2,122 |
|
|
2,311 |
|
|
2,086 |
|
|
1,868 |
|
|
1,844 |
|
|
2,016 |
|
(ALL) |
|
Contract |
|
17,240 |
|
|
17,941 |
|
|
16,329 |
|
|
14,612 |
|
|
14,403 |
|
|
14,733 |
|
|
|
Prepaid |
|
1,606 |
|
|
1,782 |
|
|
1,605 |
|
|
1,419 |
|
|
1,366 |
|
|
1,497 |
|
Greece |
|
Total |
|
31.1 |
|
|
31.0 |
|
|
27.6 |
|
|
24.7 |
|
|
25.5 |
|
|
26.2 |
|
(EUR) |
|
Contract |
|
65.6 |
|
|
66.8 |
|
|
61.6 |
|
|
56.5 |
|
|
60.0 |
|
|
62.0 |
|
|
|
Prepaid |
|
13.7 |
|
|
13.4 |
|
|
11.4 |
|
|
10.1 |
|
|
10.2 |
|
|
10.4 |
|
Ireland |
|
Total |
|
48.8 |
|
|
46.9 |
|
|
45.6 |
|
|
44.6 |
|
|
45.4 |
|
|
45.1 |
|
(EUR) |
|
Contract |
|
102.8 |
|
|
99.4 |
|
|
94.5 |
|
|
92.5 |
|
|
94.3 |
|
|
94.1 |
|
|
|
Prepaid |
|
29.3 |
|
|
28.0 |
|
|
27.9 |
|
|
27.2 |
|
|
27.1 |
|
|
26.6 |
|
Malta(1) |
|
Total |
|
14.7 |
|
|
16.6 |
|
|
12.6 |
|
|
12.0 |
|
|
14.0 |
|
|
15.5 |
|
(MTL) |
|
Contract |
|
39.2 |
|
|
38.2 |
|
|
36.0 |
|
|
34.7 |
|
|
36.3 |
|
|
37.2 |
|
|
|
Prepaid |
|
11.2 |
|
|
13.4 |
|
|
9.2 |
|
|
8.5 |
|
|
10.5 |
|
|
12.0 |
|
Netherlands |
|
Total |
|
35.7 |
|
|
36.9 |
|
|
31.7 |
|
|
36.1 |
|
|
37.9 |
|
|
38.8 |
|
(EUR) |
|
Contract |
|
63.5 |
|
|
64.6 |
|
|
52.0 |
|
|
57.8 |
|
|
59.7 |
|
|
59.6 |
|
|
|
Prepaid |
|
10.1 |
|
|
10.4 |
|
|
9.8 |
|
|
9.8 |
|
|
10.6 |
|
|
10.8 |
|
Portugal |
|
Total |
|
23.5 |
|
|
24.4 |
|
|
22.8 |
|
|
22.1 |
|
|
22.4 |
|
|
23.7 |
|
(EUR) |
|
Contract |
|
62.2 |
|
|
62.8 |
|
|
57.8 |
|
|
54.2 |
|
|
54.9 |
|
|
59.0 |
|
|
|
Prepaid |
|
13.0 |
|
|
13.9 |
|
|
13.2 |
|
|
13.2 |
|
|
13.2 |
|
|
14.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EMAPA Subsidiaries |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Australia |
|
Total |
|
49.4 |
|
|
52.4 |
|
|
54.0 |
|
|
51.3 |
|
|
50.5 |
|
|
49.5 |
|
(AUD) |
|
Contract |
|
92.7 |
|
|
96.4 |
|
|
98.8 |
|
|
97.1 |
|
|
96.2 |
|
|
93.6 |
|
|
|
Prepaid |
|
33.9 |
|
|
36.2 |
|
|
37.2 |
|
|
34.1 |
|
|
33.0 |
|
|
32.0 |
|
Czech Republic |
|
Total |
|
674 |
|
|
670 |
|
|
658 |
|
|
613 |
|
|
635 |
|
|
619 |
|
(CZK) |
|
Contract |
|
978 |
|
|
966 |
|
|
946 |
|
|
897 |
|
|
916 |
|
|
889 |
|
|
|
Prepaid |
|
331 |
|
|
334 |
|
|
331 |
|
|
295 |
|
|
320 |
|
|
320 |
|
Egypt |
|
Total |
|
79.4 |
|
|
88.1 |
|
|
79.4 |
|
|
75.0 |
|
|
75.6 |
|
|
71.6 |
|
(EGP) |
|
Contract |
|
292.1 |
|
|
309.7 |
|
|
289.9 |
|
|
295.8 |
|
|
308.8 |
|
|
304.5 |
|
|
|
Prepaid |
|
57.1 |
|
|
66.7 |
|
|
61.4 |
|
|
59.1 |
|
|
60.4 |
|
|
58.2 |
|
Hungary |
|
Total |
|
5,066 |
|
|
5,339 |
|
|
5,171 |
|
|
4,749 |
|
|
4,935 |
|
|
4,994 |
|
(HUF) |
|
Contract |
|
9,129 |
|
|
9,097 |
|
|
8,529 |
|
|
7,847 |
|
|
8,010 |
|
|
7,832 |
|
|
|
Prepaid |
|
3,125 |
|
|
3,359 |
|
|
3,250 |
|
|
2,839 |
|
|
2,873 |
|
|
2,930 |
|
India(2) |
|
Total |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
361 |
|
(INR) |
|
Contract |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
995 |
|
|
|
Prepaid |
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
N/A |
|
|
277 |
|
New Zealand |
|
Total |
|
46.6 |
|
|
46.6 |
|
|
50.7 |
|
|
49.3 |
|
|
47.1 |
|
|
48.8 |
|
(NZD) |
|
Contract |
|
126.1 |
|
|
125.3 |
|
|
128.9 |
|
|
122.8 |
|
|
117.2 |
|
|
118.7 |
|
|
|
Prepaid |
|
23.2 |
|
|
22.5 |
|
|
23.7 |
|
|
23.4 |
|
|
21.4 |
|
|
22.0 |
|
Turkey(2) |
|
Total |
|
N/A |
|
|
16.5 |
|
|
14.4 |
|
|
14.4 |
|
|
15.7 |
|
|
16.3 |
|
(TRY) |
|
Contract |
|
N/A |
|
|
31.4 |
|
|
28.2 |
|
|
28.7 |
|
|
29.2 |
|
|
29.8 |
|
|
|
Prepaid |
|
N/A |
|
|
14.8 |
|
|
12.9 |
|
|
12.9 |
|
|
14.1 |
|
|
14.7 |
|
Romania |
|
Total |
|
15.2 |
|
|
15.9 |
|
|
15.6 |
|
|
14.0 |
|
|
15.7 |
|
|
15.8 |
|
(USD) |
|
Contract |
|
29.5 |
|
|
30.8 |
|
|
30.6 |
|
|
27.1 |
|
|
31.2 |
|
|
31.9 |
|
|
|
Prepaid |
|
6.7 |
|
|
7.3 |
|
|
7.0 |
|
|
6.1 |
|
|
6.6 |
|
|
6.5 |
|
Notes:
(1) During the quarter ended 30 June 2007, Vodafone Malta restated previously published prepaid and contract average monthly mobile revenue per user to reflect a revised analysis of historic service revenue.
(2) For acquired operations, average monthly mobile revenue per user is published with effect from the quarter following each acquisition.
46
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorised.
|
|
|
VODAFONE GROUP |
|
|
|
|
PUBLIC LIMITED COMPANY |
|
|
|
|
(Registrant) |
|
|
|
|
|
|
|
|
|
|
|
Dated: November 14, 2007 |
|
By: |
/s/ S R SCOTT |
|
|
|
|
|
Name: Stephen R. Scott |
|
|
|
|
Title: Group General Counsel and Company Secretary |
|
|
|
|
|
|
|
47