Vodafone Group CEO Nick Read (pictured) credited moves to reshape the operator, including cost cuts and divestments, for keeping its financial performance resiliant against pandemic-related headwinds in its fiscal H1 2021.
During an investor call, Read said its performance in the six months to end-September was “a direct consequence of the strategic actions we’ve taken over the last two years to reshape Vodafone”.
Vodafone’s H1 revenue fell 2.3 per cent year-on-year to €21.4 billion, with lower earnings from roaming, foreign exchange headwinds, a fall in handset sales and the removal of its now sold operation in New Zealand [1] hitting figures.
Read did, however, point to good momentum in the rest of its business and revenue gained from adding assets acquired from Liberty Global in Europe into its numbers [2].
Net profit was €1.6 billion, compared with a loss of €1.9 billion [3], though both sets of figures were impacted by significant one-off items.
Results for the recent period included a gain of €1 billion from a merger of Vodafone Hutchison Australia and TPG Telecom which completed in July [4].
In H1 2020 it stripped its India business out of its results and wrote down the value of its stake in joint venture Vodafone Idea.
Restructure
Vodafone is two years into a long-term strategy to refocus various areas of the business.
Moves so far have included cost cuts; digital initiatives; changes in consumer offers; divesting operations outside its core markets in Europe and Africa; and signing various network sharing agreements. It is also in the process of spinning-off and preparing to IPO its tower assets [5].
At the same time it is launching 5G across its markets in Europe with 127 cities across nine markets able to receive the service by end-September.
Read added his aim was to “transform Vodafone into a business that enables a digital society, generating both sustainable growth and attractive returns”.
“We are executing [the business plan] at pace, but there remains more to be done to achieve our goals.”
Vodacom
Africa subsidiary Vodacom Group booked revenue of €2.4 billion in H1 2021, down from €2.7 billion.
The company noted strong growth in earnings from South Africa on demand for voice and data, a trend it said was “supported by an increase in consumer discretionary spend as a result of the ban on alcohol and tobacco sales and special government social grants during the Covid-19 (coronavirus) pandemic”.
Vodacom’s International division, comprising units outside of South Africa, reported “economic pressure and the disruption to our commercial activities” due to issues related to the pandemic including the zero-rating of some mobile money transfers.
[1] https://www.mobileworldlive.com/asia/asia-news/vodafone-sells-new-zealand-mobile-unit
[2] https://www.mobileworldlive.com/featured-content/home-banner/vodafone-finalises-e18b-liberty-global-asset-buy
[3] https://www.mobileworldlive.com/featured-content/home-banner/vodafone-chief-vows-to-end-india-losses
[4] https://www.mobileworldlive.com/featured-content/asia-home-banner/vha-tpg-conclude-merger
[5] https://www.mobileworldlive.com/featured-content/home-banner/vodafone-progresses-tower-plan-makes-greek-pact
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