Vodafone’s revenue fell by 2.6% to €43.8bn
Vodafone (LON:VOD) saw its revenue drop last year as its roaming and visitor numbers fell due to the pandemic.
The FTSE 100 telecommunications company recorded a fall in its adjusted earnings by 1.2% to €14.4bn for the year to March, as its savings totalling €500m acted as a buffer.
This fall towards the bottom of its guidance range and was lower than the €14.5bn expected by analysts, The Times reported.
Vodafone’s revenue fell by 2.6% to €43.8bn, while its net debt rose to €40.5bn, an increase of 3.6%.
The group saw its share price tumble during the morning session to 132.14p per share, down by 6.75%.
Vodafone also confirmed it will be raising its investment levels so it can target the EU’s €750bn pile of post-coronavirus recovery grants aimed at projects to upgrade the continent’s digital infrastructure.
Russ Mould, investment director at AJ Bell, gave his view on the Vodafone results.
“Who’d have thought it, people being less ‘mobile’ in general is bad news for mobile telecoms groups like Vodafone, which saw its revenue and earnings hit by lower roaming charges as individuals were unable to travel thanks to the pandemic.
“Handset sales have also slumped, suggesting we’re not so bothered about having the latest, fancy new phone when we’re stuck at home.
Nick Read, Group Chief Executive, commented on the year gone, as well as looking ahead to life beyond the pandemic.
“We have delivered on the first phase of our strategy to reshape Vodafone as a stronger connectivity provider – including the simplification of the group to Europe and Africa, the successful IPO of Vantage Towers (€13.2 billion market capitalisation), the fast roll out of our next generation mobile and fixed networks, share gain in broadband subscriptions and continued reduction in customer churn. Our digital transformation initiatives have generated savings of €0.5 billion over the year and the integration of the assets acquired from Liberty Global is well ahead of plan,” Read said.
“The world has changed. The pandemic has shown how critical connectivity and digital services are to society. Vodafone is strongly positioned and through increased investment, we are taking action now to ensure we play a leadership role and capture the opportunities that these changes create. The increased demand for our services supports our ambition to grow revenues and cash flow over the medium-term. We remain fully focused on driving shareholder returns through deleveraging, improving our return on capital, and a firm commitment to our dividend.”
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