Copyright 2004

[ May 25th 2004 ]

Vodafone Group Plc has announced its Preliminary Results Year Ended 31 March 2004. The wireless Telco recorded turnover increased by 10% to 33.6 billion pounds sterling and mobile telecommunications turnover increased by 15% to 31.7 billion pounds. Profit on ordinary activities before tax, goodwill amortisation and exceptional items, increased by 19% to 10.0 billion pounds and earnings per share, before goodwill amortisation and exceptional items, increased by 34% to 9.10 pence. Free cash flow increased by 65% to 8.5 billion pounds, after 4.3 billion pounds of net cash expenditure on tangible fixed assets and 13.7 million net new proportionate mobile customers in the year, bringing the total to 133.4 million.

Arun Sarin, Chief Executive, commented: "These results reflect a strong operational performance with an excellent level of free cash flow generation. Our financially disciplined team continues to look for ways to strengthen our core business, delight our customers and increase returns to shareholders. With the advent of our Mobile Connect 3G/GPRS datacard and Vodafone live!(TM) with 3G, we are well positioned for a future of transition as we take the lead in expanding market boundaries through new technologies and industry partnerships. We remain committed to delivering increasing returns to our shareholders, demonstrated by a 20% increase in dividends and a further 3 billion pounds of share purchases, in addition to the 1.1 billion pounds already expended.

Julian Horn-Smith, Group Chief Operating Officer, commented: "Strong customer growth and escalating take up of data services have driven double digit growth in revenues once again. Our ongoing efforts to drive cost efficiencies have offset increased competitive and regulatory pressures to further increase margins. Overall, these results demonstrate the underlying operational strength of the Group. As we transition to 3G, we will continue to enhance the customer experience, driving up brand preference and customer loyalty and building on Vodafone's success as a market leader.

Vodafone products and services include Vodafone live!(TM) with 3G introduced for consumers in Europe from 4 May 2004. Enhanced Vodafone live!(TM) content offering to customers, involving established brands such as Warner Bros. Online, Disney, Cartoon Network, Sony Pictures Mobile, Sony Music Entertainment, UEFA Champions League Football, Tomb Raider and The Simpsons.

Forecasts for the coming year, on an organic basis, the Group anticipates high single-digit average proportionate mobile customer growth, leading to broadly similar growth in proportionate mobile revenues. Taking into account the necessary investment and costs associated with opening and operating 3G networks, as well as the effects of declines in interconnect rates, the Group expects the proportionate mobile EBITDA margin to be broadly stable. For the 2005 financial year, total capitalised fixed asset additions are expected to be around 5 billion pounds, slightly higher than the 4.8 billion pounds for the 2004 financial year, mainly due to deferred investment from that year. Free cash flow is expected to be around 7 billion pounds, lower than in the 2004 financial year.

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