Vodafone Group has published its first-half year results on Tuesday morning.
The results show that net losses for the six months equated to €7.83 billion, comparing to a €1.24 billion profit on-year. The results also reveal the group revenue amounted to €21.8 billion, a 5.5% drop that was exacerbated by exchange rates.
Additionally, the group has offered an explanation for its €7.83 billion net loss. It has said that this was partly as a result of the disposal of Vodafone India, which recently merged with Idea Cellular (NSE:IDEA).
Vodafone reported a stable interim dividend per share of 4.84 cents, and its full year dividend per share is set to align with FY18.
Free cash-flow (pre-spectrum) was raised to €5.4 billion, which is an increase from the €5.2 billion guidance of the previous year.
Group Chief Executive, Nick Read, commented on the results:
“Our performance in the majority of our markets has been good during the first half of the year, and we have taken decisive commercial and operational actions to respond to challenging competitive conditions in Italy and Spain. We are on track to reduce net operating expenses for the third year running, and we are confirming the mid-point of our EBITDA guidance range, with an increased outlook for free cash flow generation.”
“Looking ahead, my new strategic priorities focus on driving greater consistency of commercial execution, accelerating digital transformation, radically simplifying our operating model and generating better returns from our infrastructure assets. Our goal is to deepen customer engagement through a broader offering of products and services and to deliver the best digital customer experience, supported by consistent investment in our leading Gigabit networks.”
In addition, Vodafone Group is also reportedly in talks with Telecom Italia to establish a 5G Italian wireless network.
Nick Read continued:
“We expect that this will drive revenue growth, reduce churn and lower our European net operating expenses by at least €1.2 billion by FY2021. As part of our effort to improve returns, we are creating a virtual internal tower company across our European operations, and we are reviewing the best strategic and financial direction for these assets.”
“Our focus on organic growth along with the strategic and financial benefits of the proposed acquisition of Liberty Global’s assets give confidence in the Group’s ability to grow free cash flow, which underpins our dividend.”
A difficult challenge that Nick Read is set to face is Vodafone’s debt pile, a primary concern for shareholders.
Earlier in July, we reported that Vodafone revenue was hit by a weak performance in Italy and Spain. Indeed, it reported a falling revenue growth in the first quarter as a result of poor performance in these areas.
At 08:46 GMT today, shares in Vodafone Group plc (LON:VOD) were up by 7.3%.