FORM 6-K
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Report of Foreign Private Issuer
Pursuant to Rule 13a-16 or 15d-16
of the Securities Exchange Act of 1934
Dated November 12, 2002_
VODAFONE GROUP
PUBLIC LIMITED COMPANY
(Exact name of registrant as specified in its charter)
THE COURTYARD, 2-4 LONDON ROAD, NEWBURY, BERKSHIRE, RG14 1JX, 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..x... Form 40-F.....
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.
Yes ..... No ..X...
If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b): 82- ________
THIS REPORT ON FORM 6-K SHALL BE DEEMED TO BE INCORPORATED BY REFERENCE IN POST-
EFFECTIVE AMENDMENT NO.1 TO REGISTRATION STATEMENT ON FORM F-3 (FILE NO.
333-10762) AND REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-81825) OF
VODAFONE GROUP PUBLIC LIMITED COMPANY AND TO BE A PART THEREOF FROM THE DATE ON
WHICH THIS REPORT IS FURNISHED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR
REPORTS SUBSEQENTLY FILED OR FURNISHED.
This Report on Form 6-K contains press releases issued by Vodafone Group Plc on
12 November 2002 entitled Interim Results
VODAFONE GROUP PLC
INTERIM RESULTS FOR THE
SIX MONTHS TO 30 SEPTEMBER 2002
PART 1
Embargo:
VODAFONE GROUP PLC Not for
publication
INTERIM RESULTS FOR THE before 07:00
SIX MONTHS TO 30 SEPTEMBER 2002 hours
12 November
2002
Excellent first half operating performance
Expectations exceeded on key growth indicators
#2.9 billion free cash flow generated
* Turnover increased 67% to #14,898 million, benefiting from
the inclusion of results from the Group's Japanese
operations, with data revenues increasing by 112% to #1,701
million. Proportionate turnover increased 15% to #16,517
million.
* Increase of over 12% in proportionate registered customer
base since 30 September 2001 to 107.5 million.
* Profit on ordinary activities before taxation, before
goodwill amortisation of #6,837 million and net exceptional
non-operating income of #267 million, increased by 41% to
#4,250 million.
* Earnings per ordinary share, before goodwill amortisation
and exceptional items, increased by 31% to 3.28 pence.
* Loss for the financial period improved by #5,399 million to
#4,336 million.
* Dividend increase doubled to 10%.
* Group EBITDA, before exceptional items, increased by 68% to
#5,566 million. Proportionate EBITDA, before exceptional
items, increased by 30% to #6,203 million.
* Free cash flow of #2,878 million, after investing #2,705
million on tangible capital expenditure. Net debt reduced to
#10,697 million.
Sir Christopher Gent, Chief Executive of Vodafone Group Plc,
commented:
"The results show Vodafone has exceeded market expectations on
key growth indicators with good turnover growth and
excellent improvements in margins leading to very strong
free cash flow generation. We are making the transition to
the new growth environment enabled by our new data services,
with a better financial performance than expected. We
expect to achieve good year on year growth on key
performance parameters and are very confident in the future
prospects for our business."
Julian Horn-Smith, Group Chief Operating Officer, commented:
"We have delivered an excellent first half operating performance
reflecting the fundamental strength of the business. The
improvements in ARPU, margins and cash flows demonstrate our
focus on growing a high quality customer base, promoting new
and existing services and driving operational efficiency
throughout the Group. Our new customer propositions,
together with our strong brand, create a compelling platform
on which to achieve our future growth objectives."
GROUP FINANCIAL HIGHLIGHTS
Statutory Six months to
30 September
2002 2001 Increase
#m #m %
Turnover 14,898 8,906 67
Group EBITDA (notes 1 and 2) 5,566 3,318 68
Total Group operating
profit/(loss)
- before goodwill amortisation
and 4,640 3,392 37
exceptional items
- after goodwill amortisation and
exceptional items (note 3) (2,197) (7,820) -
Profit/(loss) on ordinary
Activities before taxation
- before goodwill amortisation
and exceptional items 4,250 3,011 41
- after goodwill amortisation and
exceptional items (note 3) (2,320) (8,449) -
Profit/(loss) for the financial
period
- before goodwill amortisation
and exceptional items 2,234 1,702 31
- after goodwill amortisation and
exceptional items (note 3) (4,336) (9,735) -
Proportionate (note 4) Proportionate EBITDA
Proportionate turnover (Notes 1 and 2)
Six months to 30 Six months to 30
September September
2002 2001 Inc/ 2002 2001 Inc
(dec)
Mobile telecommunications #m #m % #m #m %
Northern Europe 3,565 3,133 14 1,379 1,028 34
Central Europe 2,585 2,343 10 1,174 1,026 14
Southern Europe 3,009 2,408 25 1,313 1,049 25
Americas 2,907 2,839 2 1,010 1,000 1
Asia Pacific 3,155 2,517 25 1,042 567 84
Middle East and Africa 238 252 (6) 109 108 1
----- ----- ----- -----
15,459 13,492 15 6,027 4,778 26
Other operations
Europe 380 381 - (2) (32) -
Asia Pacific 678 453 50 178 31 474
----- ----- ----- -----
16,517 14,326 15 6,203 4,777 30
===== ===== ===== =====
Organic growth at
constant exchange rates 8 24
Per share information Six months to
30 September
2002 2001 Increase
%
Basic earnings/(loss) per share
- before goodwill amortisation and
exceptional items 3.28p 2.51p 31
- after goodwill amortisation and
exceptional items (note 3) (6.36)p (14.36)p -
Dividend per share 0.7946p 0.7224p 10
Operating cash flow per share 8.33p 5.37p 55
Notes
1. Before exceptional items.
2. Group EBITDA and proportionate EBITDA are not recognised
measures under UK GAAP. Further details are given in Notes
7 and 10, respectively.
3. Goodwill amortisation charge of #6,837m, compared with
#6,697m for the six months ended 30 September 2001.
Exceptional items for the current period comprise net
exceptional non-operating income of #267m. For the six
months ended 30 September 2001, exceptional operating and
non-operating charges totalled #4,515m and #248m,
respectively. Further details are given in Notes 3 and 4.
4. Proportionate information is calculated on the basis
described in Note 1 - Basis of preparation - below.
GROUP OPERATING HIGHLIGHTS
Operational performance
* Real improvement in ARPU in some of our key markets, driven
by increased voice and data usage and improved customer mix
and activity levels. Active customers represent 94% of the
total registered proportionate customer base, compared with
92% at 31 March 2002 and 90% at 30 September 2001.
* Non-voice service revenues up in the Group's controlled
mobile businesses to 13.2% of total service revenues for the
twelve month period to 30 September 2002, compared with
11.1% for the year ended 31 March 2002. In Japan, data
revenues exceeded 20% of service revenues during August and
September.
* The Group's mobile business proportionate EBITDA margin
improved by 3.6 percentage points to 39.0%. Mobile EBITDA
margin in Japan increased from 20.5% to 32.0%.
* Organic net customer additions of over 9.4 million in the
twelve month period ended 30 September 2002. Worldwide
customer base of 107.5 million proportionate registered
customers at 30 September 2002, representing growth of 12.5%
since 30 September 2001. Venture registered customer base
over 273 million.
* Free cash flow of #2,878 million, exceeding the amount
generated for the whole of the previous financial year.
Operating cash flow increased 56% over the comparable period
to #5,676 million.
* Tangible capital expenditure of #2,705 million. The Group
expects this number to increase to over #5,500 million for
the full year, 8% below previous forecast of #6,000 million.
Commercial initiatives
* European launch of Vodafone live!, Vodafone's consumer
service, which provides colour mobile services through a
Vodafone-branded easy to use menu on integrated camera-
phones. Vodafone customers can now access picture
messaging, downloadable games and ringtones and all the
latest entertainment and information.
* Imminent launch of the first product from Vodafone's
business proposition, Vodafone Mobile Office, called
"Vodafone Remote Access", which will offer a pan-European
Vodafone-branded solution for secure remote connection of
laptops to a corporate network using a Vodafone-enabled GPRS
data card and customised software.
* Launch of new services, including prepaid top-ups, allowing
customers to top-up their prepaid mobile phones when
travelling abroad and Eurocall Platinum, building on the
success of Vodafone's single rate European price plan,
Eurocall. Eurocall Platinum is aimed at high-usage business
travellers in Europe. Launch of GPRS roaming enabling
seamless access to Vodafone live! and Vodafone Remote Access
across Vodafone and Vodafone's partner networks.
* Success of brand rollout programme and advertising campaigns
has created increased brand recognition and awareness,
supporting the rollout of Vodafone-branded services,
increasing usage and customer loyalty and attracting other
mobile operators through the Partner Network programme.
Transactions
* Agreement reached with BT and SBC to purchase their
respective 26% and 15% interests in the French
telecommunications operator Cegetel, the controlling
shareholder of the French mobile operator SFR, for an
aggregate cash consideration of Eur 6.3 billion. Both
acquisitions are subject to pre-emption rights held by
Vivendi. Non-binding cash offer of Eur 6.8 billion made to
Vivendi for its 44% interest in Cegetel rejected by the
Board of Vivendi on 29 October 2002, with the offer
subsequently lapsing. Same offer renewed to last for the
duration of the twenty-day pre-emption period ending on 10
December 2002. Until such time as the offer is formally
accepted by Vivendi, the Group reserves the right to
withdraw its offer at any time.
* Acquisition of additional minority stakes in the Group's
subsidiaries in Germany, Spain, Sweden, Portugal and
Australia, for a total cash consideration of #899 million.
* Further investment of USD 750 million in China Mobile,
increasing interest to approximately 3.27%.
* Acquisition of remaining 50% stake in Vizzavi for Eur 143
million.
* Disposal of remaining stake in Arcor's Telematik business
and stake in Bergemann GmbH, through which the Group held an
effective 8.2% stake in Ruhrgas AG, realising cash proceeds
of approximately Eur 1 billion.
BUSINESS REVIEW
The Group has continued to perform strongly in the period as it
has continued to focus on revenue growth and margin
improvement. The emphasis has been on attracting,
servicing and retaining high value customers and the
provision of new products and services.
Statutory turnover
The Group's statutory turnover increased by #5,992m to #14,898m
for the six months ended 30 September 2002 from #8,906m for
the six months ended 30 September 2001. Growth in turnover
from existing operations was #1,244m, representing an
increase of 14%, and growth in respect of acquired
businesses was #4,748m, comprising J-Phone Vodafone
(#3,731m) and Japan Telecom (#1,017m), both of which became
subsidiaries and therefore were consolidated in the second
half of the 2002 financial year.
Turnover increased as a result of the increased average customer
base and improved levels of usage, although this was partly
offset by reductions in call termination rates in certain
of the Group's markets. Compared with the twelve month
period ended 31 March 2002, ARPU for the twelve months
ended 30 September 2002 improved in Germany and the UK as a
result of a combination of these factors together with
increased levels of customer base activity resulting from
expected disconnections from the customer base. Mobile
data revenues also increased and made a significant
contribution to overall turnover growth and ARPU
improvements and, at #1,701m, data accounted for 13.2% of
service revenues in the Group's controlled mobile
subsidiaries for the twelve months ended 30 September 2002,
compared with 11.1% for the 2002 financial year. SMS
revenues continue to represent the principal component of
data revenues and the increase reflects both increases in
usage per customer and penetration of the service into the
customer base. In addition, Japan has continued to develop
its data and content service offerings, contributing to an
increase in data revenues which, for the last two months,
represented over 20% of service revenues. The Group is
expecting to further grow non-voice service revenues
through its Vodafone live! and Vodafone Mobile Office
service offerings, which are described in more detail under
"Strategic Developments, Products and Services", below.
Expenses
Consolidated cost of sales increased from #4,916m for the six
months ended 30 September 2001 to #8,574m and now
represents 58% of turnover, compared with 55% for the six
months ended 30 September 2001. The Group's equipment
costs and cost of providing financial incentives to service
providers and dealers for acquiring and retaining customers
reduced to 12.4% compared with 14.6% of turnover for the
comparative six-month period. This excludes the effects of
the first time inclusion of J-Phone Vodafone where costs to
connect and retain customers, although reducing, are
significantly higher than in the Group's other markets.
This decrease reflects the continued focus on gaining and
retaining high-value customers in the most cost-efficient
manner. Inclusive of J-Phone Vodafone, equipment costs
and financial incentives amounted to 19.0% of turnover.
Sales and administration costs, excluding goodwill amortisation
and exceptional items, increased from #1,744m to #2,720m,
the increase being attributable almost entirely to the
first time inclusion of J-Phone Vodafone and Japan Telecom.
These costs represented 18.3% of turnover for the six
months ended 30 September 2002 compared with 19.6% for the
comparable six months, demonstrating the Group's ongoing
focus on cost control and the realisation of synergies.
Depreciation increased by #839m to #1,892m, primarily as a result
of the consolidation of the results of J-Phone Vodafone and
Japan Telecom. Excluding the effects of J-Phone Vodafone
and Japan Telecom, the Group's depreciation charge
increased 12% over the comparable period.
Operating results
The total Group operating profit for the period, before
exceptional items and goodwill amortisation, increased by
37% from #3,392m to #4,640m, including an increase of #620m
in respect of J-Phone Vodafone and Japan Telecom, which
both became subsidiaries of the Group in October 2001.
After goodwill amortisation and exceptional items, the total Group
operating loss improved from a loss of #7,820m in the six
months ended 30 September 2001 to a loss of #2,197m for the
six months ended 30 September 2002 as the increased
goodwill amortisation charge of #140m was more than offset
by a #4,515m reduction in exceptional operating items and
the #1,248m improvement in operating profit.
Proportionate results
Proportionate turnover increased 15% to #16,517m as a result of
strong organic growth together with the effect of increased
stakes in certain of the Group's existing businesses,
principally Japan Telecom and J-Phone Vodafone. In the
mobile businesses, proportionate turnover also grew by 15%
to #15,459m, including 10% organic growth in service
revenues.
The Group's proportionate EBITDA margin in the mobile businesses
increased from 35.4% in the comparable period to 39.0% in
the six months ended 30 September 2002, with all the
Group's main markets reporting increased EBITDA margins.
Greater control over customer acquisition and retention
costs accounted for 1.5 of the 3.6 percentage point
increase in the Group's mobile EBITDA margin during the
period, with the remainder of the margin improvement
arising from ongoing cost control and the realisation of
synergies. In Japan, proportionate mobile EBITDA margins
have been improved from 20.5% to 32.0%, as a result of
lower customer acquisition and retention costs and the
continuing benefits generated through the merger of
regional operating companies into a single structure. This
increase was also achieved against a backdrop of continued
strong demand for camera-enabled handsets and increased
competition.
A regional review of the Group's principal business, the supply of
mobile telecommunications services and products, is
presented below. A review of the Group's other operations,
which primarily comprise fixed line telecommunications
businesses, an update on progress made with the Group's
data products and services initiatives, including Vodafone
live! and Vodafone Mobile Office, further information on
the Group's financial performance and a summary of the
outlook for the financial years ended 31 March 2003 and
2004 can be found below. The appendices to these results
also contain information on certain key performance
indicators for the quarter and six months ended 30
September 2002, including details of the registered
customer base, ARPU and non-voice service revenue data.
Mobile Telecommunications
The Group's mobile businesses were the principal drivers of growth
in the period and continue to demonstrate the Group's
operational strength, with turnover and operating profit,
before goodwill amortisation and exceptional items,
increasing by 59% and 30% to #13,440m and #4,675m,
respectively. The Group continued to expand its customer
base in the period, adding a further 6.4 million customers
to its proportionate registered customer base. At 30
September 2002 the Group had 107.5 million proportionate
registered customers and a total venture base of 273.2
million, compared with 101.1 million and 229.2 million,
respectively, at 31 March 2002.
Northern Europe
Financial highlights Six months to
30 September
2002 2001 Increase
#m #m %
Statutory turnover - United Kingdom 2,000 1,805 11
- Other Northern
Europe 981 777 26
------ ------
2,981 2,582 15
------ ------
Statutory total Group - United Kingdom 541 394 37
operating profit - Other Northern
(note 1) Europe 535 355 51
------ ------
1,076 749 44
------ ------
Proportionate turnover - United Kingdom 2,000 1,805 11
- Other Northern
Europe 1,565 1,328 18
------ ------
3,565 3,133 14
------ ------
Proportionate EBITDA - United Kingdom 739 565 31
(before exceptional - Other Northern
items) Europe 640 463 38
------ ------
1,379 1,028 34
------ ------
Proportionate EBITDA - United Kingdom 37.0% 31.3%
margin - Other Northern
Europe 40.9% 34.9%
Key performance indicators
(United Kingdom only)
ARPU (note 2) #282 #276
Churn (note 2) 29.7% 27.0%
Cost to connect #63 #78
(1) before goodwill amortisation and exceptional items
(2) ARPU and churn information represents the twelve month periods
ended 30 September 2002 and 31 March 2002, respectively
United Kingdom
Vodafone UK reported strong profit growth as it continued to
realise benefits from the acquisition and retention of high
value customers and the continuing focus on cost
efficiencies. This is reflected in a 37% increase in total
Group operating profit, before goodwill and exceptional
items, achieved on an 11% increase in statutory turnover.
Operating efficiency initiatives, including the benefits of
last year's restructuring, have contributed strongly to a
5.7 percentage point increase in EBITDA margin.
The trend of declining ARPU in the market place was reversed with
blended ARPU for the twelve months to 30 September 2002
increasing to #282 compared to #276 for the twelve months
ended 31 March 2002. Improved customer activity levels
contributed to this increase with active customers
increasing from 89% of the base at 31 March 2002 to 93% at
30 September 2002. In addition, Vodafone UK's share of
outgoing mobile service revenue in Oftel's quarterly review
stands at 33.9%, representing a lead of 6.7% over the
second placed UK network.
In the twelve months ended 30 September 2002, data revenue as a
percentage of service revenue has increased to 13.2%
compared to 11.8% for the year ended 31 March 2002 and 8.9%
for the twelve months ended 30 September 2001. This is
primarily due to continued increases in SMS penetration and
usage in both the contract and prepaid base, as customers
take advantage of the full range of products and services
available.
Contract ARPU has fallen from #555 to #536 due to the continued
migration of higher value prepaid customers onto contract
tariffs. Notwithstanding this migration, Vodafone UK has
seen an increase in prepaid ARPU to #121 as opposed to #118
for the twelve months to 31 March 2002 as inactive
customers were disconnected.
As at 30 September 2002, Vodafone UK had 12,957,000 registered
customers, of whom 5,264,000 were contract customers. The
contract base now makes up 41% of the total base, which
represents an improvement of three percentage points since
31 March 2002. Vodafone UK's contract base now exceeds
that of its nearest competitor by 26%. The period saw the
proportion of active prepaid customers increase from 84% of
the prepaid base at 31 March 2002 to 90% at 30 September
2002.
Blended churn for the twelve months to 30 September 2002 increased
when compared to the twelve months to 31 March 2002 as a
result of increased disconnections of the inactive prepaid
base. Contract churn has fallen from 26.1% to 23.5% for
the twelve months to 30 September 2002, whilst prepaid
churn has risen to 33.5%.
Whilst continuing to invest in the connection of higher value
customers, the UK business maintained a stable contract
cost to connect of #121, compared with #119 for the six
months ended 30 September 2001. The average cost to
connect for prepaid customers fell from #32 to #10,
improving the profitability of this market segment further.
Other Northern Europe
The Group successfully completed the rollout of its rebranding
programme across its other interests within Northern Europe
as Europolitan Vodafone migrated to the single Vodafone
brand in April 2002. Vodafone brand awareness was further
strengthened across the region with the launch of the 'How
are you?' campaigns in The Netherlands, Sweden and Ireland.
The Group's other interests within Northern Europe reported strong
financial performance. Statutory turnover increased by 26%
over the period partly as a result of the enlarged customer
base and increased voice and data revenues. Voice revenues
increased in all Other Northern Europe markets, with a
particularly strong increase reported in Vodafone
Netherlands, where blended ARPU increased by 7%. Data
revenues also grew across the region including Vodafone
Ireland where data and SMS revenues for the twelve months
ended 30 September 2002 represented 17% of total service
revenues.
The proportionate registered customer base increased by 264,000 to
10,084,000 and was driven by continued growth by SFR in the
relatively under-penetrated French market and increased
consumer sales in Sweden, including the successful launch
of its new Vodafone-branded prepaid product. Vodafone
Ireland also consolidated its position as the largest
mobile operator in Ireland with a 57% market share.
In July 2002, Vodafone Ireland was awarded one of four twenty-year
UMTS licences for a total cost of Eur 114m.
Central Europe
Financial highlights Six months to
30 September
2002 2001 Increase
#m #m %
Statutory turnover - Germany 2,251 2,067 9
- Other Central
Europe 57 23 148
------ ------
2,308 2,090 10
------ ------
Statutory total Group - Germany 775 707 10
operating profit (note - Other Central
1) Europe 97 75 29
------ ------
872 782 12
------ ------
Proportionate turnover - Germany 2,246 2,057 9
- Other Central
Europe 339 286 19
------ ------
2,585 2,343 10
------ ------
Proportionate EBITDA - Germany 1,038 931 11
(before exceptional - Other Central
items) Europe 136 95 43
------ ------
1,174 1,026 14
------ ------
Proportionate EBITDA - Germany 46.2% 45.3%
margin - Other Central
Europe 40.1% 33.2%
Key performance
indicators
(Germany only)
ARPU (note 2) Eur 308 Eur 298
Churn (note 2) 25.6% 23.5%
Cost to connect Eur 73 Eur 110
(1) before goodwill amortisation and exceptional items
(2) ARPU and churn information represents the twelve month periods
ended 30 September 2002 and 31 March 2002, respectively
Germany
The robust operating results for Vodafone Germany, which were
achieved against a backdrop of difficult economic
conditions, reflect the benefits arising from its customer
base management programme, which has seen the continued
removal, during the first quarter, of inactive prepaid
customers from the customer base, an increase in the
contract base and the launch of further innovative products
and services.
Statutory turnover increased as a result of higher levels of voice
usage and improved data and messaging revenues, which now
represent 15.4% of service revenues, with data revenues
benefiting from continued strong SMS usage and increased
mobile internet activity. The launch of Multimedia
Messaging Services, "MMS", in April 2002, the first such
launch in Germany, and other services such as premium SMS
and GPRS roaming also contributed to the improved data
revenue performance. Equipment revenues were lower as a
result of increased levels of SIM-only connections.
The downward trend in customer numbers was reversed in the period,
despite the continued removal of inactive prepaid customers
from the customer base, as Vodafone Germany was able to
increase the number of contract customers in the twelve
month period to 30 September 2002, increasing the share of
contract customers in its base from 40% at 30 September
2001 to 45%. Vodafone Germany introduced further
initiatives aimed at improving the customer mix including
the launch of a customer loyalty programme, "Vodafone
Stars", and the signing of a co-operation agreement with
Lufthansa, to strengthen customer loyalty within the
business segment and to better address the requirements of
high value roaming customers. As a result, Germany
increased the proportion of its customer base that is
active to 92% at 30 September 2002, compared with 91% at 31
March 2002.
The improved mix in the customer base has contributed to the
improved blended ARPU performance, with prepaid ARPU for
the twelve months to 30 September 2002 increasing to Eur
121 from Eur 110 for the twelve months to 31 March 2002.
Contract ARPU reduced to Eur 542, compared with Eur 559 for
the twelve months to 31 March 2002. The increase in the
blended churn rate can be attributed to a slightly reduced
contract churn rate, which decreased from 18.3% to 16.3%,
offset by the prepaid churn rate which increased from 27.1%
to 32.5% as a result of the removal of inactive customers
from the prepaid customer base.
Operating profit benefited from improved equipment margins as a
result of lower handset subsidies, with prepaid cost to
connect reducing to Eur 19 and contract cost to connect
reducing to Eur 129, benefiting from an increased share of
SIM-only connections. Further increases in the EBITDA
margin were also made as a result of improved operational
efficiency.
Other Central Europe
The Group's other interests within Central Europe reported
improved financial performance, reflecting both continued
growth in the mobile markets represented and improved
operational efficiency.
In the six month period from 31 March 2002, the proportionate
registered customer base increased by 14%, with Vodafone
Hungary increasing its customer base by 27%. In Poland,
penetration levels improved from 28% to over 32% in the
period, with Polkomtel increasing its customer base by 13%.
The Polish market was particularly competitive during the
period as the third largest operator chased market share
ahead of customer profitability. However, Polkomtel's ARPU
remains the highest in Poland.
Voice and data revenues in Hungary grew significantly over the
comparable period as a result of a 27% increase in its
customer base and were also boosted by improved roaming
revenues and the launch of prepaid roaming top-ups.
The increase in proportionate turnover includes the effect of an
18.2% stake increase in Vodafone Hungary and a 7% increase
in turnover in Polkomtel. Voice and data revenues increased
in Swisscom Mobile although the increase was partly offset
by a decline in national roaming turnover and reduced
revenue from handset sales.
EBITDA margins improved in all of the businesses within Other
Central Europe.
Vodafone Group Plc
Interim Results
For six months ended 30 September 2002
PART 2
Southern Europe
Financial highlights Six months to
30 September
2002 2001 Increase
#m #m %
Statutory turnover - Italy 2,086 1,739 20
(note 1)
- Other Southern
Europe 1,791 1,489 20
------ ------
3,877 3,228 20
------ ------
Statutory total Group - Italy 777 676 15
operating profit - Other Southern
(note 2) Europe 484 390 24
------ ------
1,261 1,066 18
------ ------
Proportionate turnover - Italy 1,598 1,328 20
(note 1)
- Other Southern
Europe 1,411 1,080 31
------ ------
3,009 2,408 25
------ ------
Proportionate EBITDA - Italy 789 655 20
(before exceptional - Other Southern
items) Europe 524 394 33
------ ------
1,313 1,049 25
------ ------
Proportionate EBITDA - Italy 49.4% 49.3%
margin (note 2) - Other Southern
Europe 37.1% 36.5%
Key performance indicators
(Italy only)
ARPU (note 3) Eur 345 Eur 345
Churn (note 3) 18.5% 19.0%
Cost to connect Eur 26 Eur 38
(1) comparatives have not been restated for the effect of a
change in the accounting for distributor discounts on
prepaid top-up cards
(2) before goodwill amortisation and exceptional items
(3) ARPU and churn information represents the twelve month
periods ended 30 September 2002 and 31 March 2002,
respectively
Italy
The results for Vodafone Omnitel demonstrate continuing strong
operational performance, with Vodafone Omnitel
consolidating its position as the second largest operator
in the 90% penetrated Italian mobile market.
Statutory turnover increased by 20% which was mainly attributable
to an 18% increase in service revenues driven by higher
usage levels, increased average customer base and improved
margins on prepaid top-ups, which more than offset Vodafone
Omnitel's decision to reduce termination rates during the
period and lower revenues from national roaming. After
adjusting 2001 results onto a comparable basis for
distributor discounts on prepaid top-up cards, statutory
turnover and service revenues increased by 15% and 14%,
respectively. Service revenue growth was also boosted by
data revenues, which increased by 50% compared with the six
month period ended 30 September 2001 and for the month of
September 2002 represented 10.4% of service revenues, with
almost 53% of customers using data products. This increase
was primarily due to higher SMS revenues reflecting
successful promotional activities. Proportionate EBITDA,
before goodwill amortisation and exceptional items,
increased by 20%. The proportionate EBITDA margin, after
adjusting 2001 results onto a comparable basis for
distributor discounts on prepaid top-up cards, increased
from 47.3% to 49.4%.
Prepaid ARPU remained stable at Eur 296 for the twelve months to
30 September 2002 compared to Eur 297 for the 12 months to
31 March 2002. Contract ARPU benefited from Vodafone
Omnitel's targeted acquisition and retention policy and
increased from Eur 769 in the year ended 31 March 2002 to
Eur 794 for the twelve months ended 30 September 2002.
Total average cost to connect reduced to Eur 26 as a result
of Vodafone Omnitel's commercial policies.
Since 31 March 2002, Vodafone Omnitel's registered customer base
increased over 3% and, at 30 September 2002, stood at
18,316,000, 91% of whom were connected to prepaid tariffs
and only 6% of whom were considered inactive. On 7 October
2002, the number of competitors in the Italian market
reduced to three following the split-up and sale of Blu's
assets, part of which have been acquired by Vodafone
Omnitel.
Competition was further intensified following the introduction of
mobile number portability and as other operators sought to
emulate the success of Vodafone Omnitel's Omnione loyalty
programme by developing their own commercial offers and
incentives aimed at sustaining customer loyalty. In this
environment, Vodafone Omnitel was able to slightly reduce
its churn rate and make net customer gains. Furthermore,
in the most recent customer satisfaction survey carried out
in the period, Vodafone Omnitel confirmed its leadership
over competitors.
During the period, Vodafone Omnitel increased its focus on
providing innovative value added services to its customer
base, introducing MMS services, which were successfully
launched in June 2002 making Vodafone Omnitel the first to
do so commercially in Italy, GPRS roaming and international
prepaid top-up facilities.
In other developments, the Italian Government agreed to extend the
duration of 2G and 3G licences from fifteen to twenty
years.
Other Southern Europe
The Group's other interests within Southern Europe continued to
achieve strong results.
The increase in statutory turnover over the period was principally
driven by a combination of an increased customer base and
higher usage levels. Turnover was adversely affected by
outgoing and incoming tariff reductions in Spain from March
2002 and incoming tariff reductions in Greece in August.
The period also saw the introduction of a fourth mobile
operator into the Greek market.
Data revenues grew particularly strongly, largely as a result of
higher SMS revenues and in response to successful launches
of premium SMS products and services within Spain. The
launch of MMS in Greece and Portugal, where Vodafone
companies were the first operators to offer such services,
is expected to contribute to future increases in data
revenues. Proportionate registered customers increased 10%
to 11,983,000, including the effect of an additional 2.2%
stake increase in Vodafone Spain.
Vodafone Portugal maintained its overall market position as the
second largest operator in Portugal whilst strengthening
its leadership in the contract segment.
The Group's operations in Albania, Malta and Romania all continue
to perform satisfactorily in terms of customer growth and
profitability. In particular, Albania, which has only been
operating for fourteen months, now has a market share of
over 40%. In Romania, the Government is shortly to award
four UMTS licences.
AMERICAS
Financial highlights Six months to
30 September
2002 2001 Inc/(dec)
#m #m %
Statutory turnover - Verizon Wireless - - -
- Other Americas 5 6 (17)
------ ------
5 6 (17)
------ ------
Statutory total Group - Verizon Wireless 653 745 (12)
operating profit - Other Americas (9) (5) (80)
(note 1)
------ ------
644 740 (13)
------ ------
Proportionate turnover - Verizon Wireless 2,841 2,754 3
- Other Americas 66 85 (22)
------ ------
2,907 2,839 2
------ ------
Proportionate EBITDA - Verizon Wireless 1,002 992 1
(before exceptional - Other Americas 8 8 -
items)
------ ------
1,010 1,000 1
------ ------
Proportionate EBITDA - Verizon Wireless 35.3% 36.0%
Margin - Other Americas 12.1% 9.4%
Key performance
indicators
(Verizon Wireless only)
ARPU (note 2) USD 574 USD 576
Churn (note 2) 29.8% 29.0%
Cost to connect (note 3) USD 139 USD 120
(1) before goodwill amortisation and exceptional items
(2) ARPU and churn information represents the twelve month
periods ended 30 September 2002 and 31 March 2002,
respectively
(3) comparative restated by Verizon Wireless to be on a basis
consistent with the current period
Verizon Wireless
Verizon Wireless operates in a highly competitive market place,
which currently consists of six nationwide competitors and
several regional and smaller rural carriers, and has
retained its position as the leading mobile
telecommunications provider in the United States in terms
of number of customers, network coverage and revenues.
Difficult economic conditions in the US have resulted in
net customer growth slowing considerably from prior years.
Nevertheless, Verizon Wireless has continued its strong
growth in customer net additions for the last two quarters
due to successful marketing campaigns.
The increase in proportionate turnover for the period is primarily
due to increased service revenue from the larger customer
base, as well as additional handset sales for both upgrades
and gross additions. The proportionate EBITDA margin
decreased slightly as a result of higher retention costs
and higher acquisition costs. Statutory total Group
operating profit, before goodwill and exceptional items,
decreased primarily due to a 43% higher depreciation charge
resulting from increased capital expenditure to handle
increased usage resulting from bundled tariffs and to
improve network capacity in spectrum-constrained areas.
The results for the period were also impacted by the
relative strength of sterling against the US Dollar.
Proportionate turnover and proportionate EBITDA in local
currency grew by 9% and 6%, respectively.
At 30 September 2002 Verizon Wireless' total customer base stood
at 31,521,000. Approximately 94% of customers were on
contract plans and there were approximately 1.5 million
data users, the majority of whom were Mobile Web customers.
SMS usage has grown significantly in the last six months
due to the launch of inter-carrier interoperability earlier
this year. However, competitive pressures have had an
unfavourable impact on ARPU with competitors' tariffs now
incorporating large numbers of bundled minutes and have
resulted in increased cost to connect through higher
handset subsidies and higher trade commissions. The period
has also seen Verizon Wireless continue to roll out its
CDMA 1XRTT network and extend total coverage to 172 million
people, representing 75% of the Verizon Wireless national
footprint.
Verizon Wireless has USD 261 million on deposit with the Federal
Communications Commission ("FCC") representing 15% of the
payment made in relation to the re-auction of licences for
1.9GHz spectrum ("Auction 35"). On 12 September, the FCC
issued a public notice seeking comment on either dismissing
pending applications or allowing bidders to opt-out of
Auction 35. Verizon Wireless and most of the other high
bidders are urging the FCC to make a timely decision on
this matter. Verizon Wireless believe that to meet
expected usage demands in its most densely populated areas,
they will require extra spectrum in the next eighteen to
thirty months.
Other Americas
Grupo Iusacell increased its customer base from 1,995,000 at the
beginning of the period to 2,176,000 at 30 September 2002.
This 9% increase is primarily due to growth in prepaid
customer numbers within a consolidating and increasingly
competitive market. However, Grupo Iusacell experienced
erosion of higher value contract customers and an increase
in the number of inactive prepaid customers, resulting in
declines in both ARPU and EBITDA. Strategic initiatives
are being implemented to improve performance including the
appointment of a new chief executive officer, headcount
reductions and an internal reorganisation.
In August 2002, the sale of two Globalstar service provider
companies, Globalstar USA and Globalstar Caribbean, was
finalised. Efforts to sell the last remaining Globalstar
service provider, Globalstar de Mexico, are continuing.
ASIA PACIFIC
Financial highlights Six months to
30 September
2002 2001 Increase
#m #m %
Statutory turnover - Japan 3,731 - -
- Other Asia
Pacific 395 366 8
------ ------
4,126 366 -
------ ------
Statutory total Group - Japan 696 167 317
operating profit - Other Asia
(note 1) Pacific 38 18 111
------ ------
734 185 297
------ ------
Proportionate turnover - Japan 2,602 2,018 29
- Other Asia
Pacific 553 499 11
------ ------
3,155 2,517 25
------ ------
Proportionate EBITDA - Japan 833 413 102
(before exceptional - Other Asia
items) Pacific 209 154 36
------ ------
1,042 567 84
------ ------
Proportionate EBITDA - Japan 32.0% 20.5%
Margin - Other Asia
Pacific 37.8% 30.9%
Key performance
indicators (Japan only)
ARPU (note 2) Yen Yen
89,193 91,903
Churn (note 2) 23.8% 25.6%
Cost to connect (note 3) Yen Yen
31,540 34,145
(1)before goodwill amortisation and exceptional items
(2) ARPU and churn information represents the twelve month
periods ended 30 September 2002 and 31 March 2002,
respectively
(3) Cost to connect information represents the six month period
ended 30 September 2002 and the twelve month period ended 31
March 2002
Japan
Proportionate turnover for J-Phone Vodafone increased
significantly from the comparative period, and includes a
full period effect of the stake increases that took place
during the last financial year. The increase also reflects
strong customer growth, together with the success of J-
Phone Vodafone's data and content product offerings. The
results of J-Phone Vodafone were not fully consolidated
until 12 October 2001.
Penetration in the Japanese cellular market reached 57% by the end
of September 2002, representing growth of 2% over the
period. Notwithstanding the slowdown in market growth, J-
Phone Vodafone consistently captured a higher percentage of
net customer additions in each month in the period compared
to its cumulative market share. This can largely be
attributed to the strength of the brand and the popularity
of camera and internet enabled handsets. Furthermore, J-
Phone Vodafone is using an attractive mix of handsets
combined with innovative services to attract and retain
customers, which has contributed to the reduction in
customer churn.
J-Phone Vodafone enjoys the highest ARPU of any company within the
Vodafone Group and the success of data and content products
resulted in further increases in data and SMS revenues,
which exceeded 20% of service revenues in August and
September 2002. However, the positive effect this had on
ARPU was more than offset by the expected decline in voice
ARPU.
Total average cost to connect decreased following a reduction in
acquisition incentives and more cost efficient and
effective purchasing of handsets. Additionally, J-Phone
Vodafone made savings on operating costs which contributed
to significant growth in EBITDA. As a result, the mobile
EBITDA margin increased from 20.5% to 32.0%.
J-Phone Vodafone realised substantial capital expenditure
efficiencies during the period as a result of the merger of
J-Phone Vodafone's operating companies and from the
improved purchasing position it enjoys as a member of the
Vodafone Group. These efficiency gains have enabled J-
Phone Vodafone to concentrate its capital expenditure on 3G
infrastructure and pursue a faster and more efficient
rollout of its 3G network as it prepares for commercial
launch in December 2002.
Other Asia Pacific
In Australia, an extremely competitive and maturing market, EBITDA
increased by 14% due to a continued focus on improving
operational efficiency and a change in product marketing
and distribution strategy. Cost base rationalisation has
continued over the last six months with restructuring
activities reducing the workforce by 12%. Handset
subsidies have also been phased out on plans targeted at
retail customers.
Over the last six months, Australia experienced an initial decline
in blended ARPU due to the increase in the proportion of
lower spending prepaid customers. However, contract ARPU
is now stabilising with an increasing trend in SMS and data
revenue.
In the six months to 30 September 2002 Vodafone New Zealand
increased its EBITDA by 34%, revenues by 18% and blended
ARPU by over 2%.
China Mobile (Hong Kong) Limited ("China Mobile") saw monthly
customer growth slow between June 2002 and September 2002
due to seasonal effects and aggressive marketing by a
competitor that included bundled handset and tariff plans
on its newly launched CDMA network. However, excluding the
effect of the acquisition referred to below, the customer
base still grew by over ten million in the period. Monthly
ARPU continued to fall after showing signs of stabilising
earlier in the year as a result of lower tariffs aimed at
retaining customers as competition increased. SMS volumes
continued to grow substantially with 7.8 billion messages
sent in the first quarter of the current financial year, up
from 4.8 billion in the prior quarter.
On 18 June 2002 Vodafone invested a further USD 750m in China
Mobile and obtained the right to appoint a non-executive
director to the China Mobile board. Subsequently on 1 July
2002 China Mobile acquired from its parent eight provincial
cellular operations with a total of 25,143,000 customers.
Vodafone's stake in China Mobile increased to approximately
3.27% as a result of these two transactions. The two
companies' strategic alliance has been further strengthened
in areas such as roaming, standards and best practice.
MIDDLE EAST AND AFRICA
Financial highlights Six months to
30 September Inc/
2002 2001 (dec)
#m #m %
Statutory turnover 143 168 (15)
Statutory total Group
operating profit (note 1) 88 83 6
Proportionate turnover 238 252 (6)
Proportionate EBITDA 109 108 1
(before exceptional items)
Proportionate EBITDA margin 45.8% 42.9%
(1) before goodwill amortisation and exceptional items
Vodafone Egypt reported significant customer growth during the
period of 261,000 to 1,979,000 at 30 September 2002.
In South Africa, Vodacom continued to grow strongly with a 23%
proportionate EBITDA improvement and customer growth of 9%
to 7,130,000. Additionally, Vodacom's operation in
Tanzania is now contributing a positive operating profit in
its second year of operation.
In Kenya, Safaricom consolidated its position as the largest
mobile operator with 55% of the market as customer numbers
increased by 32% to 581,000 during the period.
OTHER OPERATIONS
Financial highlights Six months to
30 September
Inc/
2002 2001 (dec)
#m #m %
Statutory turnover - Europe 441 466 (5)
- Asia Pacific 1,017 - -
------ ------
1,458 466 213
------ ------
Statutory total Group - Europe (94) (181) -
operating profit/(loss) - Asia Pacific 59 (32) -
(note 1)
------ ------
(35) (213) -
------ ------
Proportionate turnover - Europe 380 381 -
- Asia Pacific 678 453 50
------ ------
1,058 834 27
------ ------
Proportionate EBITDA - Europe (2) (32) -
(before exceptional - Asia Pacific 178 31 474
items)
------ ------
176 (1) -
------ ------
(1) before goodwill amortisation and exceptional items
The Group's other operations mainly comprise interests in fixed
line telecommunications businesses, including Arcor in
Germany, Japan Telecom, Cegetel in France, Vodafone
Information Systems, an IT and data services business based
in Germany and, until 29 August 2002, the Vizzavi joint
venture.
Statutory turnover for the Group's other operations increased
primarily as a result of the stake increases in Japan
Telecom which was consolidated from 12 October 2001.
Proportionate EBITDA, before exceptional items, increased
by #177m to #176m, primarily through the impact of the
Group's increased interest in Japan Telecom and a
substantial increase in its underlying EBITDA performance.
Arcor
Arcor provides fixed network services in Germany. The German fixed
line market remains intensely competitive although Arcor
has retained its position as the leading private operator
and the strongest competitor to Deutsche Telekom, the
market leader. Turnover from voice, data and internet
businesses increased in the period compensating for the
reduction in carrier business caused by the competitive
market. During the period the contract voice customer base
increased by approximately 150,000 to 2,500,000 customers.
Total traffic volumes increased by 15% compared to the same
period in 2001 to 11.2 billion minutes.
In January 2002, a contract with Deutsche Bahn AG was signed to
carve out Arcor's railway specific telecommunication and
service business into the company Arcor DB-Telematik GmbH.
Following completion of the sale in April 2002, the
remaining 50.1% share of Telematik was sold to Deutsche
Bahn AG in July 2002.
Japan Telecom
Japan Telecom is the third largest fixed line telecommunications
operator in Japan, offering both voice and data services.
Since Vodafone gained control in October 2001, Japan
Telecom's profitability has improved significantly, with
operating profit, before goodwill amortisation and
exceptional items, of #59m for the six months ended 30
September 2002. This can be largely attributed to the
implementation of a transformation plan entitled Project V.
This plan specifically includes identifying the products
and services that will contribute the most to profit both
now and in the future, increasing focus on the core
business, and an organisational re-alignment to improve
operating efficiencies and capabilities.
The fixed line market in Japan remains extremely competitive
following the lifting of market entry restrictions and
although the carrier designation service "My-Line" was
introduced in May 2001, the maintenance of market share
continues to be a challenge in the customer voice segment.
The main focus of the business in the period has been on
high growth business opportunities and the delivery of
innovative data products and services. The corporate
customer base continues to expand due to the uptake of IP
data related services, with the next-generation IP network
"PRISM", using optical fibres, being particularly
successful.
Vodafone Group Plc
Interim Results
For the six months ended 30 September 2002
PART 3
STRATEGIC DEVELOPMENTS
Products and Services
The Group's vision is to be the world's mobile communications
leader. A major focus of the Group's strategy is to offer
innovative products and services within Vodafone-branded,
end-to-end customer propositions which utilise the Group's
global footprint and global brand to offer customers a
unique mobile experience and seamless international
services.
Brand
Since April 2002, a number of significant achievements have been
made to progress this strategy. The company implemented its
strategy to introduce the Vodafone brand into all its
controlled mobile businesses and, at 30 September 2002, all
mobile subsidiaries other than Italy and Japan had migrated
to the single Vodafone brand. Omnitel Vodafone in Italy
rebranded as Vodafone Omnitel during June 2002. In Japan,
J-Phone Vodafone is to migrate to the single brand by
December 2003. As a result of the brand rollout and the
continuing "How are you?" advertising campaign, the Group
has improved considerably its brand awareness. Vodafone
branding is now focused on building upon its brand
awareness and turning this into brand preference.
This year, the Group became a principal sponsor of Ferrari,
further promoting the awareness of the brand globally and
creating joint product development and merchandising
opportunities. Vodafone also continues to benefit from its
sponsorship of Manchester United.
The strength of Vodafone's brand and its portfolio of
international services led to the signing of a further
partner agreement with MTC of Kuwait. Under this
agreement, both Vodafone and MTC customers will now be able
to benefit from easy access to Vodafone's international
services. The Group's two existing partner agreements,
with Radiolinja of Finland and TDC of Denmark, are now
fully operational. These agreements allow the Group to
secure a return on its investment in a global brand and
have the added benefit of extending the Group's global
footprint without the need for equity investment.
New service offerings
The Vodafone brand is also of fundamental importance to the
Group's latest, and most significant service offering,
Vodafone live!. Launched in seven countries during October
and early November, Vodafone live! is a major Group-wide
programme, designed to offer the customer an integrated
experience of handset and services. Vodafone live! is
built around easy to use mobile services such as picture
messaging, games, ringtones and mobile content. Vodafone
live! and Vodafone Mobile Office, the business proposition,
are both expected to build brand preference amongst
customers.
Vodafone live! represents a significant step forward for the
Group, involving development of an integrated customer
proposition and service offering together with the
customisation of handsets with the Vodafone brand, Vodafone-
specific menus with embedded links and Vodafone-specific
games and content all launched on a co-ordinated pan-
European basis. It represents a significant building block
in the attainment of the Group's data strategy.
Part of the Vodafone live! customer offering is a wide range of
high quality, multi-media entertainment-led content
containing both international and local information. This
is provided by Vodafone Global Content Services, formerly
Vizzavi, which became a wholly-owned subsidiary of the
Group in August 2002.
Vodafone further extended its range of compelling product and
service offerings for customers with the launch, in July,
of a prepaid top-up service for international travellers,
enabling prepaid customers to use their mobiles when abroad
as if they are using them at home. This service is now
available in eleven countries. This was followed, in
September, by the launch of Eurocall Platinum, a service
aimed at reducing the cost of calls for high value roaming
customers, building on the success of Eurocall, Vodafone's
single rate European price plan, launched in January 2001.
Another major part of the Group's growth strategy is Vodafone
Mobile Office. The Group already offers services that
provide mobile access to corporate intranets and office-
based applications at speeds comparable to those available
through standard fixed telephone lines. With Vodafone
Mobile Office, the Group's offerings for business and
corporate customers will be brought together to deliver
easy and seamless access to corporate information systems
and business applications over the Vodafone network. The
first part of the Group-wide Vodafone Mobile Office
programme will be launched shortly and is called "Vodafone
Remote Access", a pan-European Vodafone-branded solution
for secure, remote connection of laptops to the corporate
network using a Vodafone-enabled GPRS data card and
customised software. With over eight million laptops in
Western Europe alone being accessed away from the desk,
this represents a significant opportunity for the Group.
3G
The development and rollout of the Group's 3G networks remains an
important element of its data strategy, with 3G networks
offering both increased spectrum capacity and quality of
service. A Group-wide 3G programme management team has
been put in place to oversee the project. To date, the
Group has achieved its initial operating target of having
commenced internal user field trials in five European
networks as well as in Japan. Over the next 12 months the
Group intends to have its 3G infrastructure technically
ready and operational in major markets, with Japan being
the first of the Group's networks to launch in December
2002.
Synergies
The globalisation of the Group's supply chain relationships is
advancing. The Group is now either managing or co-
ordinating centrally the purchase of network infrastructure
(including that related to 3G) and IT platforms used for
building services, as well as handsets and other items such
as consultancy services. Global supply chain management is
generating significant synergy savings for the Group and is
playing a key role in the Vodafone live! programme,
ensuring availability of Vodafone-configured handsets
through intensive liaison with handset suppliers.
Good progress has been made on the synergies arising from the
Mannesmann transaction. It is expected that the #500m of
forecast post tax cash flow synergies for the year ending
March 2003 will be exceeded.
Corporate Social Responsibility
The Group's corporate social responsibility ("CSR") programme is
moving ahead with the commitments made in its 2002 CSR
report, published in June 2002. The Group continues to
strengthen its CSR management system and has initiated
several projects to further quantify the benefits arising
from action on key social and environmental issues. These
include initiatives to understand and deliver energy
efficiency improvements, to explore selected mobile
applications offering specific environmental or social
benefits, and to promote additional schemes aimed at
incentivising customers to return handsets and accessories
for reuse or recycling. Vodafone also remains a constituent
of the FTSE4Good index and the Dow Jones Sustainability
index of companies.
FINANCIAL UPDATE
Profit and loss account
Total Group operating profit/loss
Before goodwill amortisation and exceptional items, total Group
operating profit increased 37% to #4,640m in the six months
ended 30 September 2002 from #3,392m in the six months
ended 30 September 2001, comprising #4,650m profit from
continuing operations and #10m loss from the acquisition of
Vizzavi.
After goodwill amortisation and exceptional items the Group
reported a total operating loss of #2,197m, compared with a
loss of #7,820m for the comparable period. This net change
of #5,623m arose as a result of a #4,515m reduction in
respect of exceptional items, and a #1,248m increase in
operating profit partly offset by a #140m increase in the
goodwill amortisation charge, which increased primarily as
a result of the acquisition of J-Phone Vodafone and Japan
Telecom in the second half of the 2002 financial year.
These charges for goodwill amortisation do not affect the
cash flows of the Group or the ability of the Group to pay
dividends.
Exceptional items
There were no exceptional operating items charged in the six
months to 30 September 2002. During the comparable period
to September 2001, exceptional operating items of #4,515m
consisted primarily of impairment charges in relation to
the carrying value of goodwill for Arcor and Grupo
lusacell.
Exceptional non-operating income of #267m (30 September 2001:
charge of #248m) mainly represents a profit on disposal of
fixed asset investments of #268m, principally relating to
the disposal of the Group's interest in Bergemann GmbH,
through which the Group's 8.2% stake in Ruhrgas AG was
held.
In accordance with UK accounting standards the Group regularly
monitors the carrying value of its fixed assets. At 31
March 2002, a review was undertaken which assessed whether
the carrying value of its assets could be supported by the
net present value of future cash flows derived from assets
using cash flow projections for each asset in respect of
the period to 31 March 2011. This review resulted in the
impairment of certain of the Group's assets. A further
review was undertaken at 30 September 2002 which included
monitoring actual cash flows to date against those
previously forecast. The results of the review indicated
that no further impairment charges were necessary.
Interest
Total Group net interest payable, including the Group's share of
the net interest expense of joint ventures and associated
undertakings, increased from #381m for the six months ended
30 September 2001 to #390m for the six months ended 30
September 2002. Net interest costs in respect of the
Group's net borrowings increased to #239m from #188m for
the comparable period, reflecting the increase in average
net debt levels. Group interest is covered 24.6 times by
Group EBITDA (before exceptional items) plus dividends
received from joint ventures and associated undertakings,
compared with 17.8 times for the six months to 30 September
2001. The Group's share of the net interest expense of
joint ventures and associated undertakings decreased from
#193m to #151m due primarily to the consolidation of the
Group's former associated undertakings, Japan Telecom and J-
Phone, Vodafone from October 2001.
Taxation
The effective rate of taxation, before goodwill amortisation and
exceptional items, for the period to 30 September 2002 was
37.7%, 2.0% higher than the rate for the year ended 31
March 2002, principally as a result of changes in the
Italian tax regime, the absence of last year's one-off
German tax refund and the consolidation of Japan Telecom
and J-Phone Vodafone into the Group's results for the
period.
Exchange rates
The effect of translating the results of overseas subsidiaries and
associates at exchange rates prevailing in the comparable
period to 30 September 2001, would have been to increase
total Group operating profit, before goodwill amortisation
and exceptional items, for the six months to 30 September
2002 by #28m.
Earnings per share
Basic earnings per share, before goodwill amortisation and
exceptional items, increased 31% from 2.51p to 3.28p for
the period to 30 September 2002.
Basic loss per share, after goodwill amortisation and exceptional
items, decreased from a loss per share of 14.36p to a loss
per share of 6.36p for the period to 30 September 2002. The
loss per share of 6.36p includes a charge of 10.03p per
share (30 September 2001: 9.88p per share) in relation to
the amortisation of goodwill and a credit of 0.39p per
share (30 September 2001: charge of 6.99p per share) in
relation to exceptional items.
Dividends
The Company has historically paid dividends semi-annually, with
the regular interim dividend in respect of the first six
months of the financial year payable in February. The
directors expect that the Company will continue to pay
dividends semi-annually.
In considering the level of dividend to declare and recommend, the
Board takes account of the outlook for earnings growth,
operating cash flow generation, capital expenditure
requirements, acquisitions and divestments together with
the possibilities for debt reductions and share buy backs.
Accordingly, the directors are recommending an interim
dividend of 0.7946 pence per share, representing a 10%
increase over last year's interim dividend.
The record date for the interim dividend is 22 November 2002, the
ex-dividend date is 20 November 2002 and the dividend is
payable on 7 February 2003.
Cash flows and funding
The increase in operating profit, before goodwill amortisation and
exceptional items, in the six month period ended 30
September 2002 translated into strong operating cash flows,
which increased 56% over the comparable period to #5,676m,
including over #1.4 billion of operating cash flows from
the Group's former associated undertakings Japan Telecom
and J-Phone Vodafone.
During the six months ended 30 September 2002, the Group increased
its operating free cash flow by 80% to #2,947m and
generated #2,878m of free cash flow, exceeding the levels
generated for the whole of the previous financial year, as
analysed below:
Six months Six months
to to Year
30 September 30 September ended
2002 2001 31 March
#m #m 2002
#m
Net cash inflow from operating
activities (Note 7) 5,676 3,640 8,102
Purchase of intangible
fixed assets (59) (223) (325)
Purchase of tangible
fixed assets (2,705) (1,816) (4,145)
Disposal of tangible
fixed assets 35 35 75
-------- -------- -------
Net capital expenditure
on intangible and
tangible fixed assets (2,729) (2,004) (4,395)
-------- -------- -------
Operating free cash flow 2,947 1,636 3,707
Dividends received from
joint ventures and
associated undertakings
(note 1) 314 32 139
Taxation (154) (545) (545)
Interest on group debt (211) (449) (854)
Dividends from investments 19 - 2
Dividends paid to
minority interests (37) (33) (84)
-------- -------- -------
Net cash outflow for returns
on investments and
servicing of finance (229) (482) (936)
-------- -------- -------
Free cash flow 2,878 641 2,365
======== ======== =======
Notes:
(1) Six months ended 30 September 2002 includes #250m from
Verizon Wireless.
The Group also invested a net #0.9 billion in merger and
acquisition activities, and an analysis of the significant
transactions is shown below:
Impact on net debt
# billion
Stake increase in China Mobile 0.5
Stake increase in Vodafone Spain 0.4
Purchase of minorities in Vodafone AG 0.3
Increase minority stakes in other subsidiaries 0.2
Purchase of remaining 50% interest in Vizzavi 0.1
Disposal of Ruhrgas and Arcor's Telematik (0.7)
business
As a result of the significant levels of free cash flow generated
and after merger and acquisition activity, Group dividend
payments of #511m and #155m of foreign exchange movements,
the Group's consolidated net debt position at 30 September
2002 decreased to #10,697m, from #12,034m at 31 March 2002.
This represented approximately 19% of the Group's market
capitalisation at 30 September 2002 compared with 14% at 31
March 2002. A further analysis of net debt can be found in
Note 8.
The Group remains committed to maintaining a solid credit profile.
Following the proposed acquisitions of interests in Cegetel
Groupe S.A., Fitch affirmed Vodafone's stable outlook and
long term credit ratings at A and short term credit ratings
at F1 on 16 October 2002. On 17 October 2002, Standard &
Poor's affirmed Vodafone's stable outlook and long term
credit ratings at A and short term credit ratings at A1 and
Moody's, although changing Vodafone's outlook to negative,
affirmed the Group's long term credit ratings at A2 and
short term credit ratings at P1.
The Group's credit ratings enable it to have access to a wide
range of debt finance including commercial paper, bonds and
committed bank facilities. The Group currently has US and
euro commercial paper programmes of USD 15 billion and #5
billion, respectively, which are used to meet short-term
liquidity requirements. The commercial paper facilities are
supported by a USD 11.025 billion committed bank facility,
which may be extended for one year from June 2003. This
facility replaced the Group's previous USD 13.7 billion
committed bank facility and as at 30 September 2002 no
amounts had been drawn under it. The Group also has a JPY225
billion committed bank facility which was fully drawn down
on 15 October 2002 and a new fully underwritten Eur 3.5
billion bank term loan, maturing in January 2006. This term
loan is available should the total consideration in respect
of the acquisition of interests in Cegetel Groupe S.A.
exceed Eur 5 billion and existing pre-emption periods have
either been waived or have expired. At 31 October 2002, the
Group had approximately #10.5 billion (pounds sterling
equivalent) of capital market debt in issue, with maturities
from April 2003 to February 2030 and #3.0 billion (pounds
sterling equivalent) of term funding.
Equity shareholders' funds
Total equity shareholders' funds at 30 September 2002 decreased
from #130,573m at 31 March 2002 to #125,912m. The decrease
comprises the loss for the period of #4,336m (after goodwill
amortisation of #6,837m), dividends of #542m and net
currency translation gains of #199m. The decrease was
partially offset by the issue of new share capital of #18m.
OUTLOOK
For the year ending 31 March 2003
The strategic focus on acquiring and retaining high value
customers is expected to continue to benefit the Group in
the second half of the financial year, with organic
proportionate customer growth sustaining the momentum of the
first half into the second.
The achievement of the expected organic customer growth rate and
the increase in proportionate customers that would result
from the exercise of the put option held by the minority
shareholders owning 6.2% of Vodafone Spain, should generate
annual growth in total proportionate customers of over 10%.
In addition, the trend seen in the six months to 30 September 2002
of either stabilisation or modest improvements in seasonally
adjusted ARPU in some key markets against that achieved in
the same period last year is anticipated to continue in the
second half, driven by further improvements in customer
activity levels, a higher proportion of contract customers
in the total base and increased voice and data usage. The
double-digit proportionate revenue growth achieved in the
first half is expected to continue.
The proportionate mobile EBITDA margin increased in the current
period to 39.0%, an increase of 3.6 percentage points over
that achieved in the comparable period last year. For the
full year it is expected that the proportionate mobile
EBITDA margin will exceed that achieved in the last
financial year and the proportionate mobile EBITDA margin
for the second half will be better than last year's second
half. However, the proportionate mobile EBITDA margin for
the full year is expected to reduce from the level achieved
in the first half of this financial year, primarily as a
result of the cost of advertising campaigns promoting our
new service offerings and the impact of expected incoming
call termination rate reductions in a number of the Group's
key markets in the second half of the year.
Total Group operating profit, before goodwill and exceptional
items, for the year is also expected to be significantly
better than that achieved in the previous financial year as
a result of the consolidation of Japan Telecom and J-Phone
Vodafone for a full year and an increased contribution from
existing businesses. However, the expected reduction in
mobile EBITDA margin in the second half of the year together
with higher depreciation, particularly in Japan as the 3G
network opens for service, is expected to lead to the second
half year operating profit, before goodwill amortisation and
exceptional items, being lower than that achieved in the
first.
Strong free cash flow generation is expected to continue in the
second half of the year with total free cash flow for the
year expected to exceed that achieved in the previous year
by a substantial margin. However, free cash flow for the
second half year is expected to be less than that achieved
in the first half, both as a result of the lower operating
result outlined above and higher tax payments, which are
expected to approach #1 billion for the full year compared
with #154 million for the first half. Capital expenditure of
over #5.5 billion is now expected for the year.
In the second half of the year, in addition to acquiring an
increased interest in Vodafone Spain, the Group may acquire
further interests in Cegetel and in its controlled publicly
listed companies. These stake increases would impact the
expectations for the second half of the financial year
outlined above.
For the year ending 31 March 2004
In respect of customer growth, the combination of high single-
digit organic growth and stake increases is expected to lead
to average customer numbers increasing over 10% compared
with this financial year. The expected trend in ARPUs,
combined with this customer growth, should lead to double-
digit revenue growth.
The expected revenue growth combined with modest margin
improvements is expected to generate growth in Group
proportionate EBITDA for the year ending 31 March 2004 of
above 15%. Tangible capital expenditure is expected to be a
similar level to the 2003 financial year although capital
efficiency, measured as the ratio of capital expenditure to
statutory turnover, is expected to improve.
Any significant acquisitions or disposals of businesses would
impact the expectations for the financial year ending 31
March 2004 set out above.
Transactions
The Group undertook the following significant transactions in the
six months to 30 September 2002:
Acquisitions
a) Acquisitions of minority stakes in subsidiary undertakings
On 2 April 2002, the Company acquired a further 2.2% stake in
Airtel Movil, S.A. ("Vodafone Spain"), for the Euro
equivalent of #0.4 billion, following the exercise of a put
option held by Torreal, S.A. This increased the Group's
interest in Vodafone Spain from 91.6% to 93.8%.
On 3 May 2002, the Group completed the purchase of the 4.5%
minority interest in Vodafone Pacific, as a result of which
Vodafone Pacific became a wholly owned subsidiary
undertaking.
The Group increased its interest in its listed subsidiary
companies, Vodafone Telecel-Comunicacoes Pessoais SA
("Vodafone Portugal") and Europolitan Vodafone AB ("Vodafone
Sweden"), through a series of market purchases at a total
cost of #151.4m. As at 30 September 2002, the Group's
interests in Vodafone Portugal and Vodafone Sweden had
increased by 10.5% and 3.6% to 61.4% and 74.7%,
respectively.
On 21 August 2002, the Group bought out the outstanding minority
shareholders in Vodafone AG, formerly Mannesmann AG, for the
Euro equivalent of #281m.
b) Other acquisitions
On 18 June 2002, the Group purchased a further stake of
approximately 1.1% in China Mobile for USD 750m, increasing
the Group's interest in China Mobile to approximately 3.27%.
On 29 August 2002, the Group acquired Vivendi Universal S.A.'s 50%
stake in the Vizzavi joint venture, which operates the
mobile content business, for Eur 143m. As a result of this
transaction, the Group owns 100% of Vizzavi, with the
exception of Vizzavi France which is now wholly owned by
Vivendi Universal S.A.
Disposals
On 8 July 2002, the Group completed the sale to E.ON AG of its
23.6% stake in Bergemann GmbH through which it held an
effective 8.2% stake in Ruhrgas AG. The total cash received
amounted to Eur 0.9 billion.
Subsequent events
Cegetel Groupe S.A. ("Cegetel")
On 16 October 2002, the Group announced that it had agreed to
acquire BT Group plc's ("BT's") 26% interest in Cegetel, the
controlling shareholder of the French mobile operator SFR,
and SBC Communication Inc.'s ("SBC's") 15% interest in
Cegetel for Eur 4.0 billion cash and Eur 2.3 billion cash,
respectively. At the same time, the Group also announced
that it had made a non-binding cash offer of Eur 6.8 billion
to Vivendi Universal, S.A., ("Vivendi") for its 44% interest
in Cegetel. Vivendi has pre-emption rights over BT and
SBC's interests in Cegetel.
On 21 October 2002, the Group announced plans for financing these
transactions, including details of a new Eur 3.5 billion
bank term loan which matures in January 2006 and which is
available upon completion of the acquisition. Further
funding would be met from a combination of available cash
resources, commercial paper programmes and existing undrawn
bank facilities. The Group would not need to raise funds in
the bond markets to finance these acquisitions. On 18
October 2002, the Group cancelled USD 174m of its USD 1,750m
February 2005 dollar bond that had previously been
repurchased.
On 29 October 2002, the Board of Vivendi announced it had decided
not to accept the Group's offer to purchase its 44% interest
in Cegetel and, accordingly, the offer lapsed.
On 6 November 2002, the Group announced that Vivendi will be
entitled to exercise its pre-emption rights from 21 November
2002 until 10 December 2002. The Group also announced that
it has renewed its initial offer at the same price to
Vivendi to last for the duration of the pre-emption period.
Until such time as the offer is formally accepted by
Vivendi, the Group reserves the right to withdraw its offer
at any time.
Vodafone Group Plc
Interim Results
For the six months ended 30 September 2002
PART 4
FINANCIAL STATEMENTS
CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE SIX MONTHS TO 30 SEPTEMBER 2002
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Turnover: Group and share of
joint ventures and
associated undertakings
- Continuing operations 19,186 15,283 33,541
- Acquisitions 3 - -
-------- -------- --------
19,189 15,283 33,541
Less: Share of joint ventures
and associated undertakings (4,291) (6,377) (10,696)
------- -------- --------
14,898 8,906 22,845
======= ======== ========
Group turnover (Note 2)
- Continuing operations 14,895 8,906 22,845
- Acquisitions 3 - -
------- -------- --------
14,898 8,906 22,845
======= ======== ========
Operating loss
- Continuing operations (2,151) (7,089) (10,377)
- Acquisitions (12) - -
------- -------- --------
(2,163) (7,089) (10,377)
Share of operating loss in
joint ventures and
associated undertakings
- Continuing operations (34) (731) (1,457)
------- -------- --------
Total Group operating loss (Note 2) (2,197) (7,820) (11,834)
Exceptional non-operating items 267 (248) (860)
(Note 4)
------- -------- --------
Loss on ordinary activities
before interest (1,930) (8,068) (12,694)
Net interest payable and similar items (390) (381) (845)
- Group (239) (188) (503)
- Share of joint ventures and
associated undertakings (151) (193) (342)
------- -------- --------
Loss on ordinary activities
before taxation (Note 2) (2,320) (8,449) (13,539)
Tax on loss on ordinary activities (1,602) (1,086) (2,140)
(Note 5)
------- -------- --------
Loss on ordinary activities
after taxation (3,922) (9,535) (15,679)
Minority interests (including
non-equity minority interests) (414) (200) (476)
------- -------- --------
Loss for the financial period (4,336) (9,735) (16,155)
Equity dividends (542) (514) (1,025)
------- -------- --------
Retained loss for the Group and
its share of joint ventures
and associated undertakings (4,878) (10,249) (17,180)
======= ======== ========
Basic loss per share (Note 6) (6.36)p (14.36)p (23.77)p
Diluted loss per share (Note 6) (6.41)p (14.41)p (23.86)p
Adjusted basic earnings per share 3.28p 2.51p 5.15p
(Note 6)
Dividend per share 0.7946p 0.7224p 1.4721p
CONSOLIDATED BALANCE SHEET
AS AT 30 SEPTEMBER 2002
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Fixed assets
Intangible assets 103,190 102,872 105,944
Tangible assets 18,573 11,309 18,541
Investments 26,303 39,274 28,977
- Loans to joint ventures - 188 321
- Investments in associated 24,757 37,284 27,249
undertakings
- Other investments 1,546 1,802 1,407
-------- -------- --------
148,066 153,455 153,462
-------- -------- --------
Current assets
Stocks 318 247 513
Debtors 6,450 4,873 7,053
Investments 2,698 6,987 1,792
Cash at bank and in hand 117 96 80
-------- -------- --------
9,583 12,203 9,438
Creditors: amounts falling due
within one year (13,434) (12,302) (13,455)
-------- -------- --------
Net current liabilities (3,851) (99) (4,017)
-------- -------- --------
Total assets less current liabilities 144,215 153,356 149,445
Creditors: amounts falling due after
more than one year (12,179) (10,810) (13,118)
Provisions for liabilities and charges (3,050) (1,739) (2,899)
Investments in joint ventures:
- Share of gross assets - 95 76
- Share of gross liabilities - (242) (345)
-------- -------- --------
- (147) (269)
Other provisions (3,050) (1,592) (2,630)
-------- -------- --------
128,986 140,807 133,428
======== ======== ========
Capital and reserves
Called up share capital 4,275 4,271 4,273
Share premium account 52,060 51,989 52,044
Merger reserve 98,927 98,928 98,927
Other reserve 877 977 935
Profit and loss account (30,227) (17,720) (25,606)
-------- -------- --------
Total equity shareholders' funds 125,912 138,445 130,573
Equity minority interests 2,054 1,269 1,727
Non-equity minority interests 1,020 1,093 1,128
-------- -------- --------
128,986 140,807 133,428
======== ======== ========
CONSOLIDATED CASH FLOW
FOR THE SIX MONTHS TO 30 SEPTEMBER 2002
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Net cash inflow from operating
activities (Note 7) 5,676 3,640 8,102
Dividends received from joint ventures 314
and associated undertakings 32 139
Net cash outflow for returns on
investments and servicing of finance (229) (482) (936)
Taxation (154) (545) (545)
Net cash outflow for capital
expenditure and financial investment (2,768) (2,107) (4,447)
- Purchase of intangible fixed assets (59) (223) (325)
- Purchase of tangible fixed assets (2,705) (1,816) (4,145)
- Disposal of tangible fixed assets 35 35 75
- Purchase of investments (521) (37) (44)
- Disposal of investments 559 110 319
- Other (77) (176) (327)
Net cash outflow for
acquisitions and disposals (859) (6,003) (7,691)
- Purchase of interests in
subsidiary undertakings (990) (1,163) (3,078)
- Net cash / (overdrafts) acquired
with subsidiary undertakings 16 23 (2,514)
- Purchase of interests in joint
ventures and associated
undertakings (12) (7,088) (7,159)
- Disposal of businesses 127 2,210 5,071
- Other - 15 (11)
Equity dividends paid (511) (486) (978)
-------- -------- --------
Cash inflow / (outflow) before
management of liquid resources and
financing 1,469 (5,951) (6,356)
Management of liquid resources (1,108) 2,881 7,042
Net cash (outflow)/inflow from
financing (326) 3,099 (675)
- Issue of ordinary share capital 18 3,548 3,581
- Debt repayment (344) (449) (4,268)
- Issue of shares to minorities - - 12
-------- -------- --------
Increase in cash in the period 35 29 11
======== ======== ========
Reconciliation of net cash flow
to movement in net debt
Increase in cash in the period 35 29 11
Cash outflow from decrease in debt 344 449 4,268
Cash outflow / (inflow) from
management of liquid resources 1,108 (2,881) (7,042)
-------- -------- --------
Decrease / (increase) in net debt
resulting from cash flows 1,487 (2,403) (2,763)
Debt acquired on acquisition
of subsidiaries - (167) (3,116)
Translation difference (155) 52 517
Other movements 5 - 50
-------- -------- --------
Decrease / (increase) in net
debt in the period 1,337 (2,518) (5,312)
Opening net debt (12,034) (6,722) (6,722)
-------- -------- --------
Closing net debt (Note 8) (10,697) (9,240) (12,034)
======== ======== ========
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE SIX MONTHS TO 30 SEPTEMBER 2002
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Loss for the financial period
- Group (3,958) (8,653) (14,131)
- Share of joint ventures and
associated undertakings (378) (1,082) (2,024)
-------- -------- --------
(4,336) (9,735) (16,155)
-------- -------- --------
Currency translation
- Group 2,148 (284) (1,980)
- Share of joint ventures and
associated undertakings (1,949) (980) (283)
-------- -------- --------
199 (1,264) (2,263)
-------- -------- --------
Total recognised gains and losses
for the period (4,137) (10,999) (18,418)
-------- -------- --------
Prior period restatement for FRS 19 - (386) (386)
-------- -------- --------
Total gains and losses recognised
since last annual report (4,137) (11,385) (18,804)
======== ======== ========
MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDS
FOR THE SIX MONTHS TO 30 SEPTEMBER 2002
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Loss for the financial period (4,336) (9,735) (16,155)
Equity dividends (542) (514) (1,025)
-------- -------- --------
(4,878) (10,249) (17,180)
Currency translation 199 (1,264) (2,263)
New share capital subscribed 18 5,929 5,984
Shares to be issued - (978) (978)
Other - - 3
-------- -------- --------
Net movement in equity
shareholders' funds (4,661) (6,562) (14,434)
Opening equity shareholders' funds 130,573 145,007 145,007
-------- -------- --------
Closing equity shareholders' funds 125,912 138,445 130,573
======== ======== ========
NOTES TO THE INTERIM RESULTS
FOR THE SIX MONTHS TO 30 SEPTEMBER 2002
1. Basis of preparation
Statutory financial information
The unaudited interim results have been prepared on a basis consistent
with the accounting policies set out on pages 78 to 80 of Vodafone
Group Plc's Annual Report & Accounts and Form 20-F for the year
ended 31 March 2002. The interim results should therefore be read
in conjunction with the 2002 Annual Report & Accounts and Form 20-
F.
The interim results for the six months to 30 September 2002, which were
approved by the Board of Directors on 11 November 2002, do not
comprise statutory accounts within the meaning of section 240 of
the Companies Act 1985. Full accounts for the year ended 31 March
2002, incorporating an unqualified auditors' report, have been
filed with the Registrar of Companies.
Proportionate financial information
The tables of financial information in Note 10 are presented on a
proportionate basis. Proportionate presentation is not a measure
recognised under UK GAAP and is not intended to replace the
consolidated financial statements prepared in accordance with UK
GAAP. However, since significant entities in which the Group has an
interest are not consolidated, proportionate information is
provided as supplemental data to facilitate a more detailed
understanding and assessment of the consolidated financial
statements prepared in accordance with UK GAAP.
UK GAAP requires consolidation of entities controlled by the Group and
the equity method of accounting for entities in which the Group has
significant influence but not a controlling interest.
Proportionate presentation is a pro rata consolidation, which
reflects the Group's share of turnover and expenses in both its
consolidated and unconsolidated entities. Proportionate results
are calculated by multiplying the Group's ownership interest in
each entity by each entity's results.
Proportionate information includes results from the Group's equity
accounted investments and investments held at cost. The Group does
not have control over the turnover, expenses or cash flow of these
investments and is only entitled to cash from dividends received
from these entities. The Group does not own the underlying assets
of these investments.
Proportionate turnover is stated net of inter-company turnover.
Proportionate EBITDA (earnings before interest, tax, depreciation
and amortisation) is defined as operating profit before exceptional
items plus depreciation and amortisation of subsidiary
undertakings, joint ventures, associated undertakings and
investments, proportionate to equity stakes. Proportionate EBITDA
represents the Group's ownership interests in the respective
entities' EBITDA. As such, proportionate EBITDA does not represent
EBITDA available to the Group.
2. Segmental and other analyses
The Group's principal business is the supply of mobile
telecommunications services and products. Other operations
primarily comprise fixed line telecommunications businesses and,
until 29 August 2002, the Vizzavi joint venture. Analyses of
turnover and total Group operating profit/(loss) by geographical
region and class of business are as follows:
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Group turnover (note 1)
Mobile telecommunications:
Northern Europe 2,981 2,582 5,432
Central Europe 2,308 2,090 4,177
Southern Europe 3,877 3,228 6,743
-------- -------- --------
Europe 9,166 7,900 16,352
Americas 5 6 12
Asia Pacific 4,126 366 4,072
Middle East and Africa 143 168 306
-------- -------- --------
13,440 8,440 20,742
Other operations
Europe 441 466 998
Asia Pacific 1,017 - 1,105
-------- -------- --------
14,898 8,906 22,845
======== ======== ========
(1)The analysis of Group turnover represents turnover of the Company
and its subsidiary undertakings and is stated net of inter-company
turnover.
Total Group operating profit/(loss) (before goodwill and exceptional
items)
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Mobile telecommunications:
Northern Europe 1,076 749 1,685
Central Europe 872 782 1,543
Southern Europe 1,261 1,066 2,072
-------- -------- --------
Europe 3,209 2,597 5,300
Americas 644 740 1,317
Asia Pacific 734 185 589
Middle East and Africa 88 83 161
-------- -------- --------
4,675 3,605 7,367
Other operations
Europe (94) (181) (306)
Asia Pacific 59 (32) (17)
-------- -------- --------
4,640 3,392 7,044
- Subsidiary undertakings 3,604 2,246 5,071
- Share of joint ventures
and associated
undertakings 1,036 1,146 1,973
Amortisation of goodwill (6,837) (6,697) (13,470)
Exceptional operating
items (Note 3) - (4,515) (5,408)
-------- -------- --------
Total Group operating loss (2,197) (7,820) (11,834)
======== ======== ========
Profit / (loss) on ordinary activities before taxation
Six months to Six months to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Profit on ordinary activities
before taxation (before
goodwill amortisation and
exceptional items) 4,250 3,011 6,199
Amortisation of goodwill (6,837) (6,697) (13,470)
Exceptional operating items - (4,515) (5,408)
(Note 3)
Exceptional non-operating
items (Note 4) 267 (248) (860)
-------- -------- --------
Loss on ordinary activities
before taxation (2,320) (8,449) (13,539)
======== ======== ========
Vodafone Group Plc
Interim Results
For the six months ended 30 September 2002
PART 5
NOTES TO THE INTERIM RESULTS (Continued)
3. Exceptional operating items
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Impairment of intangible
and tangible fixed assets - (4,450) (5,100)
Reorganisation costs - - (86)
Share of exceptional
operating items of
associated undertakings
and joint ventures - (65) (222)
-------- -------- --------
- (4,515) (5,408)
======== ======== ========
4. Exceptional non-operating items
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Amounts written off
fixed asset investments (4) (300) (920)
Profit on disposal of
fixed asset investments 268 45 9
Profit on disposal of
fixed assets - 7 10
Profit on disposal of
Businesses 3 - 41
-------- -------- --------
267 (248) (860)
======== ======== ========
5. Tax on loss on ordinary activities
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
United Kingdom
Corporation tax charge at 30% 120 144 187
-------- -------- --------
Overseas corporation tax
Current tax:
Current year 996 772 857
Prior year - (173) (322)
-------- -------- --------
996 599 535
-------- -------- --------
Total current tax 1,116 743 722
Deferred tax - origination
of and reversal of
timing differences 486 354 1,489
-------- -------- --------
Tax on loss on ordinary
activities 1,602 1,097 2,211
Tax on exceptional items - (11) (71)
-------- -------- --------
Total tax charge 1,602 1,086 2,140
======== ======== ========
Parent and subsidiary
undertakings 1,428 940 1,925
Share of associated
undertakings and joint
ventures 174 146 215
-------- -------- --------
1,602 1,086 2,140
======== ======== ========
6. Earnings per share
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Loss for basic loss per share (4,336) (9,735) (16,155)
Amortisation of goodwill 6,837 6,697 13,470
Exceptional operating
items - 4,515 5,408
Exceptional non-operating
items (267) 248 860
Tax on exceptional items - (11) (71)
Share of exceptional items
attributable to
minority interests - (12) (14)
-------- -------- --------
Earnings for adjusted
earnings per share 2,234 1,702 3,498
======== ======== ========
Weighted average number
of shares (millions):
Basic and adjusted 68,152 67,776 67,961
Diluted 67,690 67,543 67,715
7. Reconciliation of operating loss to net cash inflow from
operating activities
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Operating loss (2,163) (7,089) (10,377)
Exceptional items - 4,000 4,486
Depreciation 1,892 1,053 2,880
Amortisation of goodwill 5,335 10,962
5,767
Amortisation of other
intangible fixed assets 23 19 34
Loss on disposal of tangible
fixed assets 47 - 46
-------- -------- --------
Group EBITDA (note 1) 5,566 3,318 8,031
Working capital movements 116 322 98
Payments in respect of
exceptional items (6) - (27)
-------- -------- --------
Net cash inflow from
operating activities 5,676 3,640 8,102
======== ======== ========
(1)Group EBITDA is not a measure recognised under UK GAAP but is
presented in order to highlight operational performance of the
Group.
8. Analysis of net debt
Other
non-cash
At 1 changes & At 30
April exchange September
2002 Cash flow movements 2002
#m #m #m #m
Liquid resources 1,789 1,108 (202) 2,695
-------- -------- -------- --------
Cash at bank and
in hand 80 35 2 117
-------- -------- -------- --------
80 35 2 117
-------- -------- -------- --------
Debt due within
one year
(other than bank
overdrafts) (1,219) 231 (747) (1,735)
Debt due after
one year (12,317) 58 799 (11,460)
Finance leases (367) 55 (2) (314)
-------- -------- -------- --------
(13,903) 344 50 (13,509)
-------- -------- -------- --------
Net debt (12,034) 1,487 (150) (10,697)
======== ======== ======== ========
Included within net debt are bond issues maturing as follows:
#m
One year or less 132
More than one year but not more than two years 1,970
More than two years but not more than five years 3,277
More than five years 5,164
--------
10,543
========
9. Summary of differences between UK and US GAAP
The interim results have been prepared in accordance with UK Generally
Accepted Accounting Principles ("UK GAAP"), which differ in certain
significant respects from US Generally Accepted Accounting
Principles ("US GAAP"). A description of the relevant accounting
principles which differ materially is provided within Vodafone
Group Plc's Annual Report & Accounts and Form 20-F for the year
ended 31 March 2002. The effects of these differing accounting
principles are as follows:
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Revenues in accordance
with UK GAAP 14,898 8,906 22,845
Items decreasing revenues:
Non-consolidated subsidiaries (2,101) (2,182) (4,162)
Deferral of connection
revenues (831) (155) (1,044)
-------- -------- --------
Revenues in accordance
with US GAAP 11,966 6,569 17,639
======== ======== ========
Net loss in accordance
with UK GAAP (4,336) (9,735) (16,155)
Items (increasing)/decreasing
net loss:
Goodwill and other
intangibles amortisation (2,985) (6,280) (9,719)
Deferral of connection
income 9 (20) (15)
Capitalised interest 237 203 387
Income taxes 2,748 4,750 7,627
Minority interests 190 1,020 1,308
Loss on disposal of business - - (85)
Other (37) (43) (36)
-------- -------- --------
Net loss in accordance
with US GAAP (4,174) (10,105) (16,688)
======== ======== ========
US GAAP basic loss per
ordinary share (6.12)p (14.91)p (24.56)p
======== ======== ========
Shareholders' equity in
accordance with UK GAAP 125,912 138,445 130,573
Items increasing /
(decreasing) shareholders'
equity:
Goodwill and other
intangibles - net of
amortisation 63,317 62,067 61,765
Deferral of connection
income (91) (105) (100)
Capitalised interest 989 568 752
Cumulative deferred
income taxes (48,250) (48,469) (46,996)
Minority interests (5,738) (3,887) (5,514)
Proposed dividends 542 492 511
Other (532) (103) (104)
-------- -------- --------
Shareholders' equity
in accordance with
US GAAP 136,149 149,008 140,887
======== ======== ========
10.Proportionate financial information
Six months Six months
to to Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
#m #m #m
Proportionate turnover
Mobile telecommunications:
Northern Europe 3,565 3,133 6,516
Central Europe 2,585 2,343 4,694
Southern Europe 3,009 2,408 5,109
-------- -------- --------
Europe 9,159 7,884 16,319
Americas 2,907 2,839 5,638
Asia Pacific 3,155 2,517 5,373
Middle East and Africa 238 252 488
-------- -------- --------
15,459 13,492 27,818
Other operations:
Europe 380 381 821
Asia Pacific 678 453 1,160
-------- -------- --------
16,517 14,326 29,799
======== ======== ========
Reconciliation of proportionate turnover to statutory turnover
Proportionate turnover 16,517 14,326 29,799
Add back: minority share of
turnover in subsidiary
undertakings 2,758 1,243 3,822
Deduct: turnover of joint
ventures, associated
undertakings and trade
investments (4,377) (6,663) (10,776)
-------- -------- --------
14,898 8,906 22,845
======== ======== ========
Proportionate EBITDA
Mobile telecommunications:
Northern Europe 1,379 1,028 2,264
Central Europe 1,174 1,026 2,068
Southern Europe 1,313 1,049 2,131
-------- -------- --------
Europe 3,866 3,103 6,463
Americas 1,010 1,000 1,907
Asia Pacific 1,042 567 1,321
Middle East and Africa 109 108 211
-------- -------- --------
6,027 4,778 9,902
Other operations:
Europe (2) (32) (8)
Asia Pacific 178 31 199
-------- -------- --------
Proportionate EBITDA 6,203 4,777 10,093
Less: depreciation and
amortisation,
excluding goodwill (2,096) (1,648) (3,693)
-------- -------- --------
Proportionate total Group
operating profit before
goodwill amortisation
and exceptional items 4,107 3,129 6,400
======== ======== ========
- Mobile telecommunications 4,151 3,321 6,688
- Other operations (44) (192) (288)
Reconciliation of proportionate EBITDA to statutory EBITDA
Proportionate EBITDA 6,203 4,777 10,093
Add back: minority share
of EBITDA from
subsidiary undertakings 1,028 507 1,333
Deduct: EBITDA of joint
ventures, associated
undertakings and trade
investments (1,665) (1,966) (3,395)
-------- -------- --------
5,566 3,318 8,031
======== ======== ========
Other information
1) Copies of the Group's Interim Report will be sent to all
shareholders. Further copies will be available from the
Company's registered office:
The Courtyard
2-4 London Road
Newbury
Berkshire RG14 1JX
England.
2) This report will also be available on the Vodafone Group
Plc website: www.vodafone.com from 12 November 2002.
For further information contact:
Tim Brown, Group Corporate Affairs Director
Melissa Stimpson, Director of Group Investor Relations
Bobby Leach, Head of Group Financial Media Relations
Darren Jones, Senior Investor Relations Manager
Tel: +44 (0) 1635 673310
Tavistock Communications
Lulu Bridges/John West
Tel: +44 (0) 207 600 2288
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 Group's financial condition,
results of operations and businesses and certain of the
Group's plans and objectives with respect to these items.
In particular, forward-looking statements include statements
with respect to Vodafone's expectations as to launch and
roll-out dates for products and services, including, for
example, 3G services, Vodafone live! and Vodafone Mobile
Office; the ability to integrate our operations throughout
the Group in the same format and on the same technical
platform; the development and impact of new mobile
technology, including the expected benefits of GPRS, 3G and
other services and demand for such services; the completion
of Vodafone's brand migration programme; growth in customers
and usage, including improvements in customer mix; future
performance, including turnover, ARPU, EBITDA, cash flows,
costs, capital expenditures and improvements in margin, non-
voice services and their revenue contribution; the ability
to realise synergies through cost savings, revenue
generating services, benchmarking and operational
experience; future acquisitions, including increases in
ownership in existing investments and pending offers for
investments; mobile penetration rates; expectations with
respect to long-term shareholder value growth; our 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 requiring
changes in pricing models and/or new product offerings or
resulting in higher costs of acquiring new customers or
providing new services, or slower customer growth or reduced
customer retention; the impact on capital spending from
investment in network capacity and the deployment of new
technologies, or the rapid obsolescence of existing
technology; slower customer growth or reduced customer
retention; the possibility that technologies, including
mobile internet platforms, and services, including 3G
services, will not perform according to expectations or that
vendors' performance will not meet the Group's requirements;
changes in the projected growth rates of the mobile
telecommunications industry; the Group's ability to realise
expected synergies and benefits associated with 3G
technologies, the integration of our operations and those of
recently acquired companies, the completion of the Group's
brand migration programme and the consolidation of IT
systems; future revenue contributions of both voice and non-
voice services offered by the Group; lower than expected
impact of GPRS, 3G and Vodafone live! and Vodafone Mobile
Office on the Group's future revenues, cost structure and
capital expenditure outlays; the ability of the Group to
harmonise mobile platforms and any delays, impediments or
other problems associated with the roll-out and scope of 3G
technology and services and Vodafone live! and Vodafone
Mobile Office 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; greater than
anticipated prices of new mobile handsets; 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 new, unexpected strategic opportunities may arise in
the next two to three years, the pursuit of which could be
in the best interests of Vodafone's shareholders and that
future acquisitions that we believe to be in the best
interests of Vodafone's shareholders may have a negative
short or medium-term impact on one or more of the
measurements of our financial performance; any unfavourable
conditions, regulatory or otherwise, imposed in connection
with pending or future acquisitions or dispositions; changes
in the regulatory framework in which the Group operates,
including possible action by the European Commission
regulating rates the Group is permitted to charge; the
Group's ability to develop competitive data content and
services which will attract new customers and increase
average usage; the impact of legal or other proceedings
against the Group or other companies in the mobile
telecommunications industry; changes in exchange rates,
including particularly the exchange rate of the pound to the
euro, US dollar and the Japanese yen; the possibility that,
in connection with the agreement to purchase BT and SBC's
interests in Cegetel, Vivendi will pre-empt our offer on one
or both stakes or will not comply with the Cegetel
shareholders' agreement or delay its compliance or interpose
obstacles thereby delaying significantly our ability to gain
control of the management of Cegetel or influence its
strategic or value generative decisions or otherwise limit
the Group's ability to realise benefits of increased
ownership, and that, in connection with the Group's offer to
Vivendi for its stakes in Cegetel, Vivendi may decline the
Group's offer; and 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. 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" on
pages 29 and 30 of Vodafone's Annual Report & Accounts and
Form 20-F for the year ended 31 March 2002. 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. Neither Vodafone nor any of
its affiliates intends to update these forward-looking
statements.
Vodafone Group Plc
Interim Results
For the six months ended 30 September 2002
PART 6
APPENDIX 1 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
PROPORTIONATE NET CUSTOMERS - 1 APRIL 2002 TO 30 SEPTEMBER 2002
QUARTER TO 30 JUNE 2002
PERCENTAGE AT NET STAKE AT 30
COUNTRY OWNERSHIP 1 APRIL ADDITIONS CHANGES JUNE 2002
(note 1) 2002
(%) (000s) (000s) (000s) (000s)
NORTHERN
EUROPE
UK 100.0 13,186 (177) - 13,009
Ireland 100.0 1,704 - - 1,704
Netherlands 70.0 2,289 (4) - 2,285
Sweden 74.7 827 42 - 869
Others 5,000 75 - 5,075
TOTAL 23,006 (64) - 22,942
CENTRAL
EUROPE
Germany 100.0 21,434 (90) 1 21,345
Hungary 68.3 330 49 49 428
Others 1,567 62 - 1,629
TOTAL 23,331 21 50 23,402
SOUTHERN
EUROPE
Greece 51.9 1,539 39 - 1,578
Italy 76.8 13,560 204 1 13,765
Malta 80.0 122 - - 122
Portugal 61.4 1,445 24 - 1,469
Spain 93.8 7,241 90 172 7,503
Albania 76.4 130 36 - 166
Others 438 32 - 470
TOTAL 24,475 425 173 25,073
AMERICAS
United
States
(note 3) 44.3 13,081 324 - 13,405
Others 689 71 - 760
TOTAL 13,770 395 - 14,165
ASIA
PACIFIC
Japan 69.7 8,496 301 - 8,797
Australia 100.0 2,050 20 97 2,167
New Zealand 100.0 1,095 33 - 1,128
Others 1,685 155 978 2,818
TOTAL 13,326 509 1,075 14,910
MIDDLE EAST
AND AFRICA
Egypt 60.0 1,031 59 - 1,090
Others 2,197 85 - 2,282
TOTAL 3,228 144 - 3,372
GROUP TOTAL 101,136 1,430 1,298 103,864
QUARTER TO 30 SEPTEMBER 2002
PERCENTAGE AT 30 NET STAKE AT 30
COUNTRY JUNE ADDITIONS CHANGES SEPT PREPAID
OWNERSHIP 2002 (note 2) 2002 (note
(Note 1) 4)
(%) (000s) (000s) (000s) (000s) (%)
NORTHERN
EUROPE
UK 100.0 13,009 (52) - 12,957 59
Ireland 100.0 1,704 1 - 1,705 71
Netherlands 70.0 2,285 5 - 2,290 62
Sweden 74.7 869 34 45 948 30
Others 5,075 60 6 5,141 52
TOTAL 22,942 48 51 23,041 55
CENTRAL
EUROPE
Germany 100.0 21,345 411 54 21,810 55
Hungary 68.3 428 52 - 480 89
Others 1,629 58 - 1,687 43
TOTAL 23,402 521 54 23,977 52
SOUTHERN
EUROPE
Greece 51.9 1,578 37 - 1,615 72
Italy 76.8 13,765 260 38 14,063 91
Malta 80.0 122 2 - 124 92
Portugal 61.4 1,469 * * * *
Spain 93.8 7,503 212 - 7,715 55
Albania 76.4 166 41 - 207 98
Others 470 * * * *
TOTAL 25,073 625 348 26,046 78
AMERICAS
United
States
(note 3) 44.3 13,405 366 182 13,953 6
Others 760 (9) - 751 83
TOTAL 14,165 357 182 14,704 11
ASIA
PACIFIC
Japan 69.7 8,797 234 - 9,031 5
Australia 100.0 2,167 99 - 2,266 42
New Zealand 100.0 1,128 28 - 1,156 77
Others 2,818 185 709 3,712 56
TOTAL 14,910 546 709 16,165 51
MIDDLE EAST
AND
AFRICA
Egypt 60.0 1,090 97 - 1,187 85
Others 2,282 138 - 2,420 85
TOTAL 3,372 235 - 3,607 85
GROUP TOTAL 103,864 2,332 1,344 107,540 52
1 All ownership percentages are stated as at 30 September 2002 and
exclude options, warrants or other rights or obligations of the
Vodafone Group to increase or decrease ownership in any venture.
Ownership interests have been rounded to the nearest tenth of one
percent.
2 Represents the acquisition of the remaining minority interests in
Vodafone AG (formerly Mannesmann AG), stake increases in Vodafone
Portugal from approximately 50.9% to 61.4% and Vodafone Sweden
from approximately 71.1% to 74.7%, the acquisition of Price
Communications Wireless by Verizon Wireless, the acquisition of
eight mobile telecommunications companies in the PRC by China
Mobile Hong Kong and subsequent stake dilution from approximately
3.4% to 3.3%.
3 The Group's proportionate customer base has been adjusted for Verizon
Wireless's proportionate ownership of its customer base across
all its network interests of approximately 98.4% at 30 September
2002. In the absence of acquired interests, this proportionate
ownership will vary slightly from quarter to quarter dependent on
the underlying mix of net additions across each of these
networks.
4 Prepaid customer percentages are calculated on a venture basis.
* Listed subsidiary still to report.
APPENDIX 2 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
CONTROLLED ACTIVE CUSTOMER INFORMATION AS AT 30 SEPTEMBER 2002
CONTROLLED ACTIVE CONTROLLED
(note 1)
COUNTRY PREPAID CONTRACT TOTAL INACTIVE
(%) (%) (%) (%)
NORTHERN EUROPE
UK 90 98 93 7
Ireland 100 98 99 1
Netherlands 91 99 94 6
Sweden ** 90 91 90 10
TOTAL 91 97 94 6
CENTRAL EUROPE
Germany 91 94 92 8
Hungary ** 91 96 92 8
TOTAL 91 94 92 8
SOUTHERN EUROPE
Greece 72 92 78 22
Italy 94 92 94 6
Malta 95 98 95 5
Portugal * * * *
Spain 93 96 94 6
Albania (note 2) N/A N/A N/A N/A
TOTAL 91 95 92 8
ASIA PACIFIC
Japan (note 2) N/A N/A 99 1
Australia 93 98 96 4
New Zealand 89 100 92 8
TOTAL 91 98 98 2
MIDDLE EAST
AND AFRICA
Egypt ** 97 100 97 3
TOTAL 97 100 97 3
CONTROLLED GROUP 91 95 94 6
TOTAL
CONTROLLED INACTIVE CUSTOMER INFORMATION - HISTORY
CONTROLLED INACTIVE CUSTOMERS AS AT
COUNTRY SEPT DEC MARCH JUNE SEPT
2001 2001 2002 2002 2002
(%) (%) (%) (%) (%)
Germany 9 9 9 8 8
Italy 7 7 7 7 6
Japan N/A N/A 1 1 1
United Kingdom 16** 16** 11 9 7
Controlled Total 10 10 8 7 6
1.Active customers are defined as customers who have made or
received a chargeable event in the last three months or,
where information is not available, defined as customers who
have made a chargeable event in the last three months
(indicated by **).
2.No customer activity information is presently available in
Albania. In Japan, customer activity information is only
presently available on a total customer basis.
* Listed subsidiary still to report
APPENDIX 3 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
MONTHLY REGISTERED BLENDED ARPU FOR THE 15 MONTHS TO 30 SEPTEMBER 2002
Country Jul Aug Sep Oct Nov Dec Jan Feb
01 01 01 01 01 01 02 02
Germany EUR 26.0 25.8 24.6 25.6 24.3 24.1 25.1 22.7
Italy EUR 31.4 29.7 28.3 29.4 27.3 28.4 28.8 25.6
Japan JPY 7,520 8,060 7,850 7,410 7,770 7,640 7,470 7,200
United
Kingdom GBP 23.3 23.9 23.0 23.8 23.2 21.8 22.9 22.0
Country Mar Apr May Jun Jul Aug Sep
02 02 02 02 02 02 02
Germany EUR 25.4 25.2 26.5 26.5 27.9 27.7 26.8
Italy EUR 29.6 27.9 29.4 28.9 31.9 28.6 29.0
Japan JPY 7,630 7,310 7,400 7,160 7,670 7,410 7,180
United
Kingdom GBP 23.8 22.9 24.6 22.7 24.9 24.7 24.9
ARPU INFORMATION FOR THE 12 MONTH PERIOD TO 30 SEPTEMBER 2002
ARPU
(note 1)
COUNTRY REGISTERED REGISTERED REGISTERED
CURRENCY PREPAID CONTRACT TOTAL
NORTHERN EUROPE
UK GBP 121 536 282
Ireland EUR 319 1,071 532
CENTRAL EUROPE
Germany EUR 121 542 308
Hungary HUF 43,017 183,791 56,223
SOUTHERN EUROPE
Italy EUR 296 794 345
Malta MTL 89 909 156
Portugal EUR * * *
Spain EUR 148 643 374
ASIA PACIFIC
Japan JPY N/A N/A 89,193
Australia AUD 321 874 669
New Zealand NZD 301 1,840 652
MIDDLE EAST AND
AFRICA
Egypt EGP 708 2,941 1,001
ARPU - HISTORY
REGISTERED TOTAL ARPU FOR THE 12 MONTH PERIOD TO
COUNTRY SEPT DEC MARCH JUNE SEPT
CURRENCY 2001 2001 2002 2002 2002
Germany EUR 317 303 298 302 308
Italy EUR 345 345 345 345 345
Japan JPY N/A 93,550 91,903 90,302 89,193
UK GBP 286 278 276 278 282
1 ARPU is calculated as total revenues excluding handset revenues and
connection fees divided by the weighted average number of
customers during the period.
* Listed subsidiary still to report
APPENDIX 4 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
NON-VOICE SERVICES AS A PERCENTAGE OF SERVICE REVENUES
PROPORTIONA
TE BASIS
12 MONTHS TO SEPTEMBER 2002
30 SEPTEMBER 2002 (MONTH ONLY)
COUNTRY MESSAGING INTERNET TOTAL MESSAGING INTERNET TOTAL
DATA DATA DATA DATA DATA DATA
NORTHERN
EUROPE
UK 12.2% 1.0% 13.2% 12.7% 1.1% 13.8%
Others 8.0% 0.4% 8.4% 8.8% 0.6% 9.4%
TOTAL 10.4% 0.7% 11.1% 11.0% 0.9% 11.9%
CENTRAL
EUROPE
Germany 14.7% 0.7% 15.4% 15.4% 0.8% 16.2%
Others 7.3% 0.6% 7.9% 7.6% 0.9% 8.5%
TOTAL 13.7% 0.6% 14.3% 14.4% 0.8% 15.2%
SOUTHERN
EUROPE
Italy 9.8% 0.3% 10.1% 10.0% 0.4% 10.4%
Others 8.2% 0.1% 8.3% 9.0% 0.3% 9.3%
TOTAL 9.1% 0.2% 9.3% 9.5% 0.3% 9.8%
AMERICAS
United
States 0.2% 0.6% 0.8% 0.3% 0.7% 1.0%
Others - - - - - -
TOTAL 0.2% 0.6% 0.8% 0.3% 0.7% 1.0%
ASIA
PACIFIC
Japan 6.7% 11.4% 18.1% 7.4% 12.8% 20.2%
Others 7.3% 0.3% 7.6% 8.1% 0.4% 8.5%
TOTAL 6.8% 9.2% 16.0% 7.5% 10.2% 17.7%
MIDDLE EAST
AND AFRICA 3.5% - 3.5% 3.3% - 3.3%
PROPORTIONA
TE 8.0% 2.1% 10.1% 8.6% 2.4% 11.0%
GROUP TOTAL
STATUTORY
BASIS
CONTROLLED
GROUP TOTAL 10.0% 3.2% 13.2% 10.7% 3.6% 14.3%
NON-VOICE SERVICES AS A PERCENTAGE OF SERVICE REVENUES - HISTORY
12 MONTHS TO
COUNTRY SEP 2001 DEC 2001 MAR 2002 JUN 2002 SEP 2002
Germany 14.2% 14.3% 14.4% 14.8% 15.4%
Italy 7.1% 7.9% 8.7% 9.4% 10.1%
Japan 11.4% 13.4% 15.1% 16.6% 18.1%
UK 8.9% 10.1% 11.8% 12.6% 13.2%
Proportionate
Total 7.2% 8.0% 8.7% 9.5% 10.1%
Statutory
Total 9.3% 10.2% 11.1% 12.1% 13.2%
MONTH ONLY
COUNTRY SEP 2001 DEC 2001 MAR 2002 JUN 2002 SEP 2002
Germany 14.1% 14.6% 15.2% 15.6% 16.2%
Italy 8.6% 10.7% 9.8% 10.4% 10.4%
Japan 14.5% 16.0% 19.8% 19.9% 20.2%
UK 11.3% 12.7% 13.4% 14.3% 13.8%
Proportionate
Total 8.8% 9.7% 10.3% 10.9% 10.9%
Statutory
Total 10.4% 12.7% 13.5% 14.0% 14.3%
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 authorized.
VODAFONE GROUP
PUBLIC LIMITED COMPANY
(Registrant)
By:/s/ S R SCOTT
Name: Stephen R Scott
Title: Company Secretary
Date 12 November 2002