Vodafone Group Plc
Annual Report 2024
Contents
Strategic report
1
S FY24 highlights
2
S About Vodafone
3
S Operating in a rapidly changing industry
4
S Business model
6
S Key performance indicators
8 Chair’s message
9 Chief Executive’s statement
and strategic roadmap
10 Mega trends
12 Stakeholder engagement
15 Our people strategy
21 Our financial performance
32
S Purpose, sustainability and
responsible business
34 Our purpose
35
– Empowering People
38
– Protecting the Planet
43 Contribution to Sustainable Development Goals
44 Maintaining Trust
45
– Protecting data
51
– Protecting people
53
– Business integrity
55 Non-financial information
57 Risk management
63
– Long-term viability statement
64
– Climate-related risk
Governance
70
S Governance at a glance
72 Chair’s governance statement
74 Our governance structure
75 Division of responsibilities
76 Our Board
79 Our Executive Committee
80 Our Company purpose, values and culture
81 Board activities and principal decisions
84 Board effectiveness
86 Nominations and Governance Committee
89 Audit and Risk Committee
95 Technology Committee
96 ESG Committee
98 Remuneration Committee
100 Remuneration Policy
106 Annual Report on Remuneration
119 US listing requirements
120 Directors’ report
Financials
122 Reporting on our financial performance
123 Directors’ statement of responsibility
125 Auditor’s report
135 Consolidated financial statements and notes
227 Company financial statements and notes
Other information
235 Non-GAAP measures
249 Shareholder information
255 History and development
255 Regulation
261 Form 20-F cross reference guide
264 Forward-looking statements
265 Definition of terms
Welcome to our 2024 Annual Report
We continue to use a simplified digital-first approach to our reporting, reflecting how we operate
as a business. We provide summaries at the start of each key section, denoted by an S .
New shape of the Group
Following the announced sale of Vodafone Spain and Vodafone Italy as part of right-sizing our
portfolio for growth, both businesses are now treated as discontinued operations, and therefore
excluded from Group results for continuing operations. Prior periods have also been re-stated
to reflect the new shape of the Group.
Environmental, Social and Governance (‘ESG’) reporting
This year we have incorporated both our full cyber security and climate-related risk reporting
into the Annual Report. We also report against a number of voluntary reporting frameworks to
help our stakeholders understand our sustainable business performance. Disclosures prepared
in accordance with the Global Reporting Initiative (‘GRI’) and Sustainability Accounting
Standards Board (‘SASB’) guidance can be found in our ESG Addendum and on our website.
Our website also includes a wide range of reports which can be found on the links below.
Corporate website
vodafone.com
Investor Relations website
investors.vodafone.com
ESG Addendum
investors.vodafone.com/esgaddendum
ESG Addendum Methodology document
investors.vodafone.com/esgmethodology
SASB disclosure
investors.vodafone.com/sasb
Cyber security factsheet
investors.vodafone.com/cyber
A-Z of ESG disclosures
investors.vodafone.com/esga-z
ESG ratings
investors.vodafone.com/esg-ratings
References
Our Annual Report has been designed for easy navigation. We have cross-referenced relevant
material and included the below navigation icons. Online content can be accessed by clicking
links on the digital version, copying the website address into an internet browser, or scanning
the QR code on a mobile device.
Read more
page reference
Click to see related
content online
Click or scan to watch related
video content online
This document is the Group’s UK Annual Report and is not the Group’s Annual Report on Form 20-F that will be filed separately with the US SEC at a later date.
This report contains references to Vodafone’s website, and other supporting disclosures located thereon such as videos, our ESG Addendum and Methodology document, and our
cyber security factsheet, amongst others. These references are for readers’ convenience only and information included on Vodafone’s website is not incorporated in, and does not
form part of, this Annual Report.
FY24 update:
Margherita Della Valle, Chief Executive,
Luka Mucic, Chief Financial Officer
Vodafone
Business
Digital services &
experiences
Digital inclusion
Net zero
Data privacy
Cyber security
Watch our video content
Our performance
Our digital investor briefings
Purpose pillars
Responsible business
Our governance
Vodafone
Technology
Social contract
Human rights
Responsible
taxation
Simon Segars,
Chair of the Technology
Committee
Luka Mucic,
Chief Financial
Officer
Jean-François van
Boxmeer, Chair
David Nish,
Senior Independent
Director
Amparo Moraleda,
Chair of the
ESG Committee
Deborah Kerr,
Non-Executive
Director
Stephen Carter,
Non-Executive
Director
Delphine Ernotte Cunci,
Non-Executive
Director
Christine Ramon,
Non-Executive
Director
Hatem Dowidar,
Non-Executive
Director
Full year dividend: 9.0 eurocents per share
Progress against our strategic priorities
FY24 results
– On a like-for-like basis +2.2% growth in FY24
– EBITDAaL margin impacted by higher energy costs
5.4%
5.4%
6.6%
6.6%
7.1%
7.1%
6.3%
6.3%
3.4%
3.4%
Q4 FY24
Q3 FY24
Q2 FY24
Q1 FY24
Q4 FY23
3.0%
3.0%
4.2%
4.2%
3.6%
3.6%
4.0%
4.0%
1.6%
1.6%
Group excluding Turkey
Group
– All segments growing in FY24
– Group growth accelerated in Q4
– Vodafone Business +5.4% growth in Q4
Click or scan to watch our Group Chief
Executive, Margherita Della Valle
and Chief Financial Officer provide
an update on our FY24 results:
investors.vodafone.com/videos
Our financial performance was slightly ahead
of expectations for the year.
We have made good initial progress against our
strategic priorities, which are focused on
Customers, Simplicity and Growth.
Adjusted EBITDAaL
– Higher pre-tax ROCE under the new footprint
– Lower operating profit impacting year-over-year
FY24
(reported)
FY23
(reported)
FY23
(re-presented)
Italy &
Spain
Pre-tax ROCE
8.2%
8.2%
1.4pp
1.4pp
7.5%
7.5%
6.8%
6.8%
Return on capital employed (‘ROCE’)3
Read more about our
financial performance
in FY24 on pages
21 to 31
Organic service revenue growth1
Notes:
1. Organic growth. See page 235 for more information.
2. Organic Adjusted EBITDAaL growth.
3. This is a non-GAAP measure. See page 235 for more information..
FY24 highlights
Customers
Network quality
Very good reliability in all European markets. German cable
network quality recognised in 4 independent tests
Europe opex savings1
€0.4bn
(FY23 and FY24)
Employee engagement
+75%
Shared operations NPS
+85%
Productivity1
c.5k
role reductions
Simplicity
Organic service
revenue growth
+6.3%
Organic adjusted
EBITDAal growth
+2.2%
Adjusted free cash flow
€2.6bn
Pre-tax return on capital
employed
+7.5%
Growth2
€14.7bn
€14.7bn
(2.3)
30.0%
30.0%
€12.4bn
€12.4bn
€11.0bn
€11.0bn
33.0%
33.0%
+2.2%2
+2.2%2
FY23
EBTDAaL
(re-presented)
FY24
EBTDAaL
(reported)
Italy &
Spain
FY23
EBTDAaL
(reported)
Notes:
1. Includes Vodafone Italy and Vodafone Spain.
2. These are non-GAAP measures. See page 235 for more information.
B2B organic service
revenue growth
+5.0%
Consumer NPS
Detractors
Revenue
market share
Germany
UK
Other Europe
South Africa
Key: Improved Deteriorated
Stable
We have right-sized our European portfolio for growth.
During the year we announced:
– UK: merger of Vodafone UK and Three UK
€8bn
– Italy: sale of Vodafone Italy to Swisscom
€5bn
– Spain: sale of Vodafone Spain to Zegona
We are now focused on growing telecommunications markets,
where we have strong assets and good scale.
Progress against our strategic priorities:
1
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
About Vodafone
We are a leading European and African telecommunications company transforming the way our customers
live and work through our technology, platforms, products and services.
Where we operate
We operate mobile and fixed networks in 15 countries and have
stakes in a further seven countries through our joint ventures and
associates. We also partner with mobile networks in 43 countries
outside our footprint. Our portfolio of local markets is supported by
corporate services and shared operations, which deliver benefits
through scale and standardisation.
Europe
Consumer1
€16bn
service revenue
We provide a range of market leading mobile
and fixed line connectivity services in our
European markets. Our converged plans
combine these offerings, providing simplicity
and better value for our customers.
Other value added services include our
Consumer IoT propositions, as well as
security and insurance products.
Vodafone
Business
€8bn
service revenue
We serve private and public sector customers of all sizes with a broad range of connectivity services, supported by our
dedicated global network. We have unique scale and capabilities, and are expanding our portfolio of products
and services into growth areas such as unified communications, cloud & security, and IoT.
Africa
Consumer
€5bn
service revenue
We provide a range of mobile services.
The demand for mobile data is growing
rapidly driven by the lack of fixed broadband
access and by increased smartphone
penetration. Together with Vodacom’s
VodaPay super-app and the M-Pesa payment
platform, we are the leading provider of
financial services, as well as business and
merchant services in Africa.
Note:
1. Includes Turkey.
Europe1
Africa
How we are structured and what we sell
Our business comprises of infrastructure assets, shared operations,
growth platforms and retail and service operations. Our retail and
service operations are split across three broad business lines:
Vodafone Business, Europe Consumer and Africa Consumer.
Core connectivity products and services in fixed and mobile account
for the majority of our revenue. However, our portfolio also includes
high return growth areas that leverage and complement our core
connectivity business, such as digital services, the Internet of Things
(‘IoT’) and financial services. We market and sell through digital and
physical channels.
9 countries
6 countries
98m mobile customers
157m mobile customers
17m fixed customers
46m FinTech users
4m converged customers
2
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Governance
Financials
Other information
Operating in a rapidly changing industry
Our governance
Our business is underpinned by our strong
governance and risk management framework.
Governance
The Board held seven scheduled meetings this year to discuss key strategic
matters, our purpose and culture, our people and stakeholder interests.
The Nominations and Governance Committee evaluates the
composition and performance of the Board and ensures an appropriate
balance of independence, skills, knowledge, experience and diversity.
The Audit and Risk Committee provides effective governance over
the appropriateness of financial reporting of the Group, including the
adequacy of related disclosures, the performance of the internal audit
function and the external auditor and oversight of the Group’s systems
of internal control, risk management framework and compliance activities.
The Technology Committee supports the Board with fulfilling the
technology strategy for the Group, including assessing risks and
exploring new innovations for future growth.
The ESG Committee oversees our Environmental, Social and
Governance (‘ESG’) programme, including our purpose, sustainability
and responsible business practices, and our contribution to the societies
we operate in under our social contract.
The Remuneration Committee advises the Board on policies for
executive remuneration and reward packages for the Chair, executives
and senior management team.
Click or scan to watch our Non-
Executive Directors speak about
their roles in short video interviews:
investors.vodafone.com/videos
Click or scan to watch our privacy and
cyber experts explain how we protect
customer data and our networks:
investors.vodafone.com/videos
Risk management
Risks are not static and as the environment changes, so do risks –
some diminish or increase, while new risks appear. We continuously
review and improve our risk processes in order to ensure that the
Company has the appropriate level of support in meeting its strategic
objectives.
Our risk framework clearly defines roles and responsibilities, and
sets out a consistent end-to-end process for identifying and
managing risks. We have embedded the risk framework across the
Group as this allows us to take a holistic approach and to make
meaningful comparisons. Our approach is continuously enhanced,
enabling more dynamic risk detection, modelling of risk
interconnectedness and use of data, all of which are improving our
risk visibility and our responses.
Our Board oversees principal and emerging risks, which are
reported to the various management committees and the Board
throughout the year. Additionally, risk owners are invited to present
in-depth reviews to ensure that risks are continuously monitored, and
appropriate treatment plans are implemented to bring each risk
within an acceptable tolerance level.
Read more
on pages 70 to 99
Read more
on pages 57 to 63
The long-term trends that are shaping our industry
and driving new growth opportunities.
Mega trends
Read more
on pages 10 to11
Connected devices
– A wide range of new devices, across all sectors
and applications, are increasingly being
connected to the internet.
– The Internet of Things (‘IoT’) is expected to
create huge value for businesses and society,
unlocking new efficiencies by delivering
real-time information.
– As the number of IoT devices increases,
physical assets are also communicating with
each other in real-time and new digital markets
are being established giving birth to the
‘Economy of Things’.
Click or scan to watch
our Vodafone Business
investor briefing:
investors.vodafone.com/
vtbriefing
Digital payments
– Businesses demand reliable and secure mobile
connectivity as transactions migrate to online
channels and apps.
– In Africa, increasing smartphone penetration
drives the adoption of digital payments.
– Network operators and a range of FinTech
startups are using mobile payment
applications to sell additional financial services
focused products such as insurance and loans.
Click or scan to watch
our Digital Services
investor briefing:
investors.vodafone.com/
digital-services
Adoption of cloud technology
– The cloud is increasingly utilised by businesses
and consumers as a more efficient way of
sharing compute capacity and services.
– SMEs increasingly understand the benefits of
cloud technology but lack the technical
expertise or direct relationships with cloud
specialists to make an effective transition to
the cloud.
– This presents an opportunity for network
operators to play a role as a partner to support
smaller businesses on their digital
transformation journeys.
Click or scan to watch our
Vodafone Technology
investor briefing:
investors.vodafone.com/
vtbriefing
Generative artificial intelligence (‘Gen AI’)
– The full range of potential applications and
long-term impacts of Gen AI are only starting
to be understood.
– The technology is widely expected to drive
significant economic benefit globally through
productivity increases and new business
opportunities.
– Potential applications include AI-generated
content for marketing campaigns, customer
care and back-office activities.
Click or scan to learn
more about how Vodafone
works with artificial
intelligence (‘AI’):
investors.vodafone.com/
artificial-intelligence
3
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Other information
Business Model
Our investment case
We operate in growing markets, where we hold strong positions with good local scale. We have a sustainable
and predictable financial profile, and have compelling structural drivers in Vodafone Business, Africa and in
our portfolio of investments.
1
Strong positions
in growing
markets
Attractive markets
Germany
UK
Other Europe
Africa
Market size
€57bn
+3.2%
€56bn
+3.4%
€28bn1
+3.1%
€18bn
+6.8%
Majority three player markets, all growing over the last three years
Strong assets
Vodafone revenue mix
38%
19%
23%2
20%
Service revenue growth3
0.2%
5.0%
4.2%
9.2%
Vodafone growing faster than the market in most regions
3
Sustainable and
predictable
financial profile
Cash flows
Robust balance sheet
Attractive returns
– Growing free cash flow per
share
– Long dated and low cost debt
2.25-2.75x
target leverage range
– Secure and growing dividend
– Long-term share buyback
programme
4
Structural
growth drivers
Vodafone Business
Africa
Investments & innovation
Digital service growth
+11%
Financial service growth
+20%
2
Focus on driving
operational
excellence
Right-sized for growth & reorganised for operational excellence
Europe1
– 9 countries
– 98m mobile
customers
– 17m fixed customers
Africa4
– 6 countries
– 157m mobile
customers
– 46m FinTech users
Business
– Connectivity
– Communications
services
– Cloud & Security
– Internet of Things
Investments
– Operations
– Infrastructure
– Innovation
– Partner Markets
(43 countries)
Shared Operations
– Procurement
– Technology and
operations
– Roaming and carrier
services
– Network services
Notes:
1. Includes Turkey.
2. Includes Turkey and Common Functions.
3. Organic growth. See page 235 for more information.
4. Excludes Safaricom.
4
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Clear and consistent strategic priorities
We are committed to delivering value and building
strong relationships with all of our stakeholders.
Creating long-term value for our stakeholders
Read more
on pages 12-14
Our priorities
Customers
– Delivering the simple and predictable experience our
customers expect
– Getting the basics right and refocusing our resources
towards improving customer experience
To drive operational excellence across the Group.
Our customers
310m
mobile customers1
18m
TV customers1
22m
broadband
customers1
Our people
93,000
employees and
contractors
75%
employee
engagement index
Our suppliers
8,000
suppliers
€6.3bn
capital additions
€19bn
spend
Our local
communities and
non-governmental
organisations
(‘NGOs’)
€40m
donated in contributions and in-kind
services, combined with our technology, to
improve health and education, and provide
emergency response across 21 countries.
Government
and regulators
€2.6bn
total direct
contribution across2
63
markets2
€9.3bn
total tax and
economic
contribution2
Our investors
Secure and
growing
dividend
Sustainable
returns
Notes:
1. Includes VodafoneZiggo and Safaricom.
2. FY23.
Well positioned to take advantage of the
key mega trends shaping our industry
Simplicity
– Become a simple and faster business
– Simplify our operations and executing on our cost
programmes to improve profitability
Growth
– Right-sizing the portfolio for growth
– Significant opportunity to grow in:
– Business
– Africa
– Vodafone Investments
Read more
on pages 9 to 11
5
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Our progress
Key Performance Indicators
Financial and non-financial performance
We measure our success by tracking key performance indicators that reflect our strategic, operational and
financial progress and performance.
Financial results summary1
2024
2023
2022
Group revenue
€m
36,717
37,672
37,010
Group service revenue
€m
29,912
30,318
30,207
Operating profit
€m
3,665
14,451
5,740
Adjusted EBITDAaL2
€m
11,019
12,424
12,693
Profit for the financial year (continuing operations)
€m
1,570
12,582
2,588
Basic earnings per share (continuing operations)
€c
4.45
43.66
7.07
Adjusted basic earnings per share2
€c
7.47
11.28
10.18
Cash inflow from operating activities
€m
16,557
18,054
18,081
Adjusted free cash flow2
€m
2,600
4,139
4,560
Net debt2
€m
(33,242)
(33,250)
(39,711)
Total dividends per share
€c
9.00
9.00
9.00
Performance against our strategic priorities1
2024
Customers
Consumer NPS
Germany
UK
Other Europe
South Africa
Detractors
Germany
UK
Other Europe
South Africa
Revenue market share
Germany
UK
Other Europe
South Africa
Key: Improved Deteriorated
Stable
Network quality
Very good reliability in all European markets. German cable network
quality recognised in 4 independent tests.
2024
Simplicity
Europe opex savings3 (FY23 and FY24)
€bn
0.4
Employee engagement index4,5
%
75
Shared operations NPS4
%
85
Productivity (role reductions)3
thousand
c.5
2024
Growth2
Organic service revenue growth
%
6.3
B2B organic service revenue growth
%
5.0
Organic adjusted EBITDAaL growth
%
2.2
Adjusted free cash flow
€bn
2.6
Pre-tax return on capital employed
%
7.5
Notes:
1. The results for the year ended 31 March 2024 exclude Vodafone Spain and Vodafone Italy
and therefore, except as otherwise described, the results for the year ended 31 March 2023
and 31 March 2022 have been re-presented to reflect that.
2. These are non-GAAP measures. See page 235 for more information.
3. Includes Vodafone Italy and Vodafone Spain.
4. As at May 2024.
5. The employee engagement index is based on an average index of responses to three
questions: satisfaction working at Vodafone; experiencing positive emotions at work; and
recommending us as an employer.
6
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A purpose-led, sustainable and responsible business
We want to enable a digital, inclusive and sustainable society. To underpin the delivery of our purpose,
we ensure that we operate in a responsible way. Acting lawfully and with integrity is critical to our
long-term success.
Empowering People1,2
2024
2023
2022
4G population coverage (outdoor 1Mbps) – Europe2
%
99
99
99
4G population coverage (outdoor 1Mbps) – Africa3
%
74
70
66
4G population coverage (outdoor 1Mbps) – Group2
%
85
83
80
Cumulative V-Hub unique visitors4
million
3.3
2.3
3.65
Customers connected to our financial inclusion services6
million
66.2
60.7
54.5
Protecting our Planet1,2
2024
2023
2022
Energy use
Total energy use
GWh
5,217
5,052
4,926
Mobile and fixed access network and technology centres energy use
%
93
93
93
Percentage of purchased electricity from renewable sources
%
84
75
69
Percentage of purchased electricity from renewable sources in Europe
%
100
100
93
Greenhouse gas emissions (‘GHGs’)
Total Scope 1 and Scope 2 GHG emissions (market-based method)
m tonnes CO2e
0.69
0.91
1.02
Total Scope 3 GHG emissions
m tonnes CO2e
6.07
6.92
6.91
Total customer emissions avoided due to our green digital solutions7
m tonnes CO2e
32.8
24.9
13.5
Waste
Total network waste (including hazardous waste)
metric tonnes
6,205
7,716
6,367
Network waste reused or recycled
%
96
95
96
Maintaining Trust1
2024
2023
2022
Our people
Average number of employees and contractors
thousand
93
91
90
Employee turnover rate (voluntary)
%
9
12
14
Women on the Board
%
42
54
50
Women in management and senior leadership roles
%
35
33
31
Women as a percentage of employees
%
39
39
39
Health & safety
Number of lost-time incidents – employees and contractors
#
18
13
9
Lost-time incident rate per 200,000 hours8
#
0.02
0.01
0.01
Code of Conduct
Completed ‘Doing What’s Right’ employee training5
%
94
92
89
Number of ‘Speak Up’ reports5
#
649
505
642
Tax and economic contribution
Total tax and economic contributions9
€bn
-
9.3
8.2
Responsible supply chain
Total spend10
€bn
19
21
20
Number of direct suppliers10,11
thousand
8
9
9
Number of site assessments conducted collectively by JAC12 initiative members
#
150
83
71
Notes:
1. Information relating to 2023 and 2022 has been restated to reflect portfolio changes
completed during FY23 and FY24.
2. Operations in Italy and Spain have been classified as discontinued operations in line with ‘IFRS
5 - Non-current Assets Held for Sale and Discontinued Operations’. All remaining operations
are reported as continuing operations. This disaggregation of information has been reflected
in all comparative periods.
3. Based on coverage in Africa, including Egypt.
4. Includes 100% of data relating to Vodafone Ziggo.
5. Includes Vodafone Italy and Vodafone Spain.
6. Includes 100% of data relating to Safaricom.
7. The avoided emissions for 2022 have been restated to 13.5 million tonnes CO2e (previously
15.6 million tonnes CO2e) resulting from the incorrect calculation of emissions avoided in
fleet management solutions.
8. Total Recordable Incident Rate (‘TRIR’) is an industry-standard calculation that is based on the
assumption that 100 employees work a combined 200,000 hours p.a (equivalent to 40 hours
per week, for 50 weeks of the year per employee).
9. Includes direct taxes, non-taxation based revenue mechanisms, such as payments for the
right to use spectrum, and indirect taxes collected on behalf of governments around the
world, excludes joint ventures and associates. The FY24 figure will be finalised during FY25.
For more information, refer to our Tax and Economic Contribution reports, available at:
vodafone.com/tax.
10. Unique suppliers based on suppliers’ ultimate parent company.
11. Excludes Vodafone Automotive.
12. Joint Alliance for CSR.
7
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Reshaping Vodafone for growth
Chair’s message
This has been a year of significant change as we aim
to deliver our purpose to connect for a better future.
We have taken all the steps needed to transform our
portfolio and good progress has been made with our
strategic priorities of Customers, Simplicity and Growth.
Portfolio transformed, good initial strategic progress
As I said last year, the Company has underperformed and further
change is needed to drive sustainable value creation for our
shareholders. The Board and I have been pleased with Margherita’s
pace and decisiveness over the last year and we have seen the first
impacts of our focus on our new strategic priorities of Customers,
Simplicity and Growth. Whilst there is much more to do, we are
making faster and more decisive commercial decisions, customer
satisfaction has seen broad-based improvements, and we have moved
towards a commercial model for our shared operations. Vodafone
Business growth is accelerating as we are strengthening our position
as the leading platform for businesses, supported by unique strategic
partnerships. We are also forging partnerships that leverage our
existing strengths, unlock value and accelerate growth.
The shape of the Group has also changed as we focus on markets
where we can grow and earn returns on our investments in excess of
our cost of capital; this was not possible organically in UK, Spain or
Italy. With our reshaped footprint, Vodafone will have strong positions
with good local scale in each of our markets, and this will ensure we
can deliver sustainable and predictable growth and a step-up in returns.
Board composition
Following an extensive and rigorous search, I was delighted to
welcome Luka Mucic as Chief Financial Officer and an Executive
Director of the Board in September 2023. Luka brings substantial
experience in finance, international leadership and enterprise &
technology solutions. Luka has been very supportive of the
transformation of Vodafone and I am confident that his track record
and expertise will aid the delivery of our strategic priorities.
We have also welcomed Hatem Dowidar, Group Chief Executive Officer
of e&, to our Board as a Non-Executive Director from 19 February 2024.
Hatem represents our largest shareholder and brings extensive
telecommunications experience. He also knows us well after holding
various Vodafone leadership positions prior to joining e&. Hatem’s
appointment to the Board marks the next phase of our strategic
relationship with e&.
Last year, the Board approved the creation of a Technology Committee as a
Committee of the Board. I have been pleased to see the Committee and its
expert membership bring additional insight to the Board and Vodafone, in
its first year overseeing the Group’s technology strategy and considering
how it supports the overall Company strategy today, and in the future.
FY24 financial performance & new capital allocation
framework
Our financial results for FY24 were ahead of expectations and we
achieved our financial guidance for the year.
Total revenue declined 2.5% to €36.7 billion, with Group organic service
revenue growing by 6.3%1 this year. This was driven by growth in
Europe, Africa and Business.
Our reported financials were also impacted by adverse currency
movements during the year.
Adjusted EBITDAaL increased by 2.2%1 on an organic basis as good
service revenue progress was partially offset by higher energy costs
and inflationary impacts. Adjusted free cash flow was €2.6 billion1,
reflecting lower adjusted EBITDAaL. Group return on capital employed
increased as a result of the right-sizing of our portfolio, however
decreased year-on-year to 7.5% on a pre-tax basis due to lower
operating profit1. Group operating profit decreased by 74.6% to €3.7
billion, primarily reflecting business disposals in the prior financial
year and adverse foreign exchange rate movements, and as a result
basic earnings per share decreased to 7.47 eurocents. Our balance
sheet position remains robust, with Group leverage now at 2.5x2.The
Board has declared a total dividend per share of 9.0 eurocents with
respect to FY24, implying a final dividend per share of 4.5 eurocents,
which will be paid on 2 August 2024 following shareholder approval
at our AGM.
In March 2024, we announced a new capital allocation framework as
the execution of our portfolio right-sizing has provided the necessary
clarity over the future shape of the Group. Under our new capital
allocation framework, we will continue our disciplined investment
approach, supporting our network, strategy and growth levers; adopt
a new lower target leverage range with built-in flexibility; re-base the
FY25 dividend to 4.5 eurocents per share to reflect the reshaped
Group, with an ambition to grow over time; and return surplus capital
to shareholders through share buybacks.
Connectivity drives competitiveness
As the economies and societies in Vodafone’s markets continue to
evolve, our role in providing digital connectivity and solutions grows
in importance, not only for our customers but for policymakers too.
Our digital services help to improve lives, transform industrial
productivity, drive growth and secure infrastructure. We remain firmly
committed to supporting Europe’s and Africa’s digital ambitions for
the benefit of their citizens and businesses.
In Africa, connectivity that enables our customers to access the
internet and make mobile money transfers is fundamental to the
economic development of the six countries in which we operate. As
more customers wish to move to more advanced technologies,
Vodafone is working with international partners and multilateral
institutions to tackle the challenge of smartphone affordability.
In Europe, a ‘connectivity chasm’ is opening with regions like North
America and Asia. There is a risk that in the future Europeans will have
inferior access to the latest digital innovations simply because of
outdated public policies. As a result, Europe will lack the advanced
connectivity that is essential to its global competitiveness.
Though European policymakers have made some progress, the
telecommunications market in Europe remains highly fragmented
and more needs to be done to create the right environment for
investing in next-generation connectivity. With structurally low
returns on capital in European markets and its wider importance to
competitiveness, connectivity must be a priority for European
politicians as they seek to reverse the continent’s declining
productivity and share of global output.
This is an important year for Europe. European Parliament elections
and a new European Commission give political leaders the rare
chance to change course and return the continent to its position as a
global economic leader. They must take it.
The year ahead
On behalf of the Board, I would like to thank all our colleagues across
the Group who have continued to work tirelessly to support our
transformation as we focus on our customers, become a simpler
business, and accelerate growth.
As we enter FY25, I am confident that Margherita and her management team
will continue to make progress on our strategic priorities. The ‘reshaped
Vodafone’ will be a best-in-class telco in Europe & Africa and the leading
platform for businesses, ultimately delivering value for all our stakeholders.
Jean-François van Boxmeer
Chair
Notes:
1. This is a non-GAAP measure. See page 235 for more information.
2. Proforma ratio after adjusting for foreign exchange and M&A.
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Organic service
revenue growth
+6.3%
Organic adjusted
EBITDAaL growth
+2.2%
Adjusted free cash flow
€2.6bn
Pre-tax return on capital
employed
+7.5%
Europe opex savings1
€0.4bn
(FY23 and FY24)
Employee engagement
+75%
Shared operations NPS
+85%
Productivity1
c.5k
role reductions
Chief Executive’s statement and strategic roadmap
Transformation gaining momentum
“A year ago, I set out my plans to transform Vodafone, including the
need to right-size Europe for growth. Since then, we have announced
a series of transactions and we are now delivering growth in all of our
markets across Europe and Africa.
Much more still needs to be done in the year ahead. We will step-up
investment in our customer experience, improve our underlying
performance in Germany and accelerate our momentum in Business,
whilst also continuing to simplify our operations throughout the
group. We are fundamentally transforming Vodafone for growth.”
Margherita Della Valle
Group Chief Executive
In May 2023, we set out a new roadmap to transform Vodafone along
three strategic priorities: Customers, Simplicity, and Growth. We
measure our operational progress in these areas through a consistent
scorecard summarised below. During FY24, we have reshaped our
European footprint to focus on growing markets, with strong positions
and good local scale. Alongside the progress to right-size our
portfolio for growth, we have made good early progress with our
operational transformation, which aims to improve the experience
provided to our customers, remove complexity from our operations
and accelerate growth in revenue, profit, cash flow and return on
capital.
Customers
– Wide-reaching customer experience transformation underway,
supported by additional investment of €140 million1 in FY24, as
well as new incentives and talent development plans.
– Customers insights processed through real-time AI models, feeding
into detailed action plans on a weekly basis in all markets.
– Frontline tools and processes enhancements benefitting 70,000
team members.
– Significant improvement in Germany fixed network reliability,
recognised in four independent network quality tests.
– Despite material price inflation, customer detractors have reduced
across all segments, and we now have leading or co-leading net
promotor scores in 5 out of 9 European markets1.
Simplicity
– New organisational structure and executive management team in place.
– Completed first phase of commercialising shared operations,
enabling greater transparency, productivity and flexibility.
– Actioned 5,0001 role reductions and announced a further 2,000 in
first year of 3-year 11,0001 plan and continued to deliver opex
efficiencies.
Growth
– Reshaped European footprint focused on growing telecommunications
markets, with strong positions and good local scale.
– Vodafone now growing in all segments and accelerating
throughout the year.
– Accelerated organic service revenue growth of Vodafone Business
to 5.4% in Q4; B2B focus step-up with new organisation, sales
transformation plan, investment in products and capabilities and
strategic partnership with Microsoft.
More remains to be done across all these areas in FY25. Our priorities for the
year ahead include: stepping-up our operational performance in Germany;
further strengthening our capabilities in Vodafone Business; completing the
commercialisation of our shared operations; and completing our in-flight
portfolio transformation.
Simplicity
Customers
Growth2
Early strategic execution
We have made good initial progress against our strategic priorities.
Network quality
Very good reliability in all European markets. German cable
network quality recognised in 4 independent tests
Notes:
1. Includes Vodafone Italy and Vodafone Spain.
2. These are non-GAAP measures. See page 235 for more information.
Consumer NPS
Detractors
Revenue
market share
Germany
UK
Other Europe
South Africa
Key: Improved Deteriorated
Stable
B2B organic service
revenue growth
+5.0%
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Mega trends
Long-term trends shaping our industry
Digital services and next-generation connectivity
are increasingly central to everything we do – and
will be the driving forces that redefine relationships
between sectors, employers, employees,
customers, and friends and family.
There are four ‘mega trends’ that we believe will
continue to shape our industry and the key areas of
focus in our strategy for the years ahead: connected
devices, digital payments, adoption of cloud
technology, and generative artificial intelligence.
Connected devices
The world is becoming ever more connected, and it is not just driven
by smartphones. A wide range of new devices, across all sectors and
applications, are increasingly being connected to the internet. The
number of connections for these devices, known as the Internet of
Things (‘IoT’), is expected to increase from 2.9 billion in 2022, to 7.3
billion in 20321.
For consumers, there are a growing range of applications such as
smartwatches, tracking devices for pets, bags and bicycles, and
connected vehicles, which can lower insurance premiums and enable
a range of advanced in-vehicle solutions.
For businesses, the demand for IoT and potential use cases is even
more evident. These include solutions such as automated monitoring
of energy usage across national grids, tracking consumption in smart
buildings and detecting traffic and congestion in cities.
In environments that are more localised, such as factories and ports,
network operators are building and running Mobile Private Networks
(‘MPNs’). MPNs offer corporate customers unparalleled security and
bespoke network control. As an example, MPNs enable autonomous
factories to connect to thousands of robots, enabling them to work in
a synchronised way. Once a product leaves the factory it can also be
tracked seamlessly through global supply chain management
applications, whether it is delivered through the post, in a vehicle or
even via drones.
In areas where the same solution can be deployed across multiple
sectors, network operators are moving beyond connectivity to
provide complex end-to-end hardware and software solutions such as
surveillance, smart metering and remote monitoring. It is often more
efficient for these solutions to be created in-house. Scaled operators
can leverage their unique position to co-create or partner with nimble
start-ups at attractive economics.
As the number of IoT devices increases, physical assets are also
communicating with each other in real time and new digital markets
are being established. This is leading to the Economy of Things, where
connected devices securely trade with each other on a user’s behalf,
without human intervention. This presents businesses across multiple
industries with exciting opportunities to transform goods into tradeable
digital assets which can compete in new disruptive online markets.
Digital payments
Businesses in Europe continue to expand and migrate sales channels
from physical premises to online channels such as websites and
mobile applications. As a result, businesses increasingly transact
through mobile-enabled payment services which remove the need
for legacy fixed sales terminals. Consequently, businesses demand
reliable and secure mobile connectivity. Consumers are also
increasingly transitioning away from using cash to digital payment
methods conducted directly via mobile phones or smartwatches,
further increasing the importance of mobile networks.
In Africa, digital payments are primarily conducted via mobile phones
through payment networks owned and operated by network
operators. The annual value of mobile money transactions reached
€1.3 trillion globally in 2023, up 14% versus the previous year2.
Consumers are also moving beyond peer-to-peer transactions as
rising smartphone penetration drives the adoption of mobile payment
applications. Network operators and a range of FinTech start-ups are
using these applications to sell additional financial services focused
products, ranging from advances on mobile airtime and device
insurance to more complex offerings such as life insurance, loans and
e-commerce marketplaces. These play a critical role in improving
financial inclusion for millions of people across Africa in areas where
the traditional banking sector has not been able to reach.
M-Pesa is Africa’s most successful mobile money service and the
region’s largest Fintech platform. It provides more than 63 million
customers across six countries in Africa with a safe, secure and
affordable way to send and receive money, top up airtime, make bill
payments, receive salaries and get short-term loans.
Businesses are also increasingly reliant on operator-owned payment
infrastructure for consumer-to-business payments and for large
business-to-business transfers. These payment networks drive scale
benefits for the largest operators by allowing customers to save on
transaction fees whilst also driving both business and consumer
customers to seek reliable and secure networks.
Vodacom’s super app VodaPay allows users to manage money
through a digital wallet and make payments for all the products and
services that the app offers through a wide range of partner
businesses.
Click or scan to watch our
Vodafone Business investor
briefing:
investors.vodafone.com/
vbbriefing
Notes:
1. Analysys Mason, 2023.
2. GSMA, 2024.
Click or scan to watch
our digital services and
experiences investor briefing:
investors.vodafone.com/
digital-services
Read more about how we build
platforms for financial inclusion
on pages 36-37
Read more on how we enable
customers to reduce their GHG
emissions with IoT on page 41
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Generative artificial intelligence
Artificial intelligence (‘AI’) is the ability of machines to perform tasks
that are typically associated with human intelligence, such as learning
and problem-solving.
Generative AI (‘Gen AI’) is a type of AI that can create new content,
such as images, text or music by learning from existing examples of
the same content. It does this by training foundation models, known
as Large Language Models (‘LLMs’), on huge sets of example data. At
the end of the training, the model can generate content that is
statistically similar to the examples used for its training. Growth in
computing power and the abundance of data available for training
has led to an exponential growth in the size and capability of artificial
neural networks, with the release of ChatGPT in November 2022
sparking a significant increase in interest in the technology among
both consumers and enterprises. The latest Gen AI models are based
on networks with trillions of parameters and have been trained on the
entire contents of the internet.
Potential applications of Gen AI can range from those that directly
benefit customers, such as AI-generated recommendations or
hyper-personalised marketing content, to more operational use cases
such as analysis of unstructured data or software development
‘co-piloting’ (drafting computer code based on natural-language
prompts). The full range of potential applications and long-term
impacts of Gen AI are starting to be understood, but the technology is
widely expected to drive significant economic benefit globally
through productivity increases and new business opportunities.
Vodafone is strategically positioned to deploy Gen AI at industry-
leading speed and scale, leveraging our deep partnerships with
Google and Microsoft and our best-in-class reference architecture
and cloud-based data ocean. Initial use cases include enhancing
customer satisfaction by delivering hyper-personalised experiences
across all Vodafone customer touch points, including Vodafone’s
digital assistant TOBi. Vodafone employees will also be able to
leverage Gen AI capabilities to transform working practices, boost
productivity and improve digital efficiency.
Adoption of cloud technology
Over the past decade, large technology companies have invested
heavily in advanced centralised data storage and processing
capabilities that organisations and consumers can access remotely
through connectivity services (commonly termed ‘cloud’ technology).
As a result, organisations and consumers are increasingly moving
away from using their own expensive hardware and device-specific
software to using more efficient shared hardware capacity or services
through the cloud. This is popular as it allows upfront capital
investment savings, the ability to efficiently scale resources to meet
demand, systems that can be easily updated and increased resilience.
This is driving demand for fast, reliable and secure connectivity with
lower latency.
Many small businesses increasingly understand the benefits of cloud
technology, however, they lack the technical expertise or direct
relationships with large enterprise and cloud specialists. This presents
an opportunity for network operators, particularly those with strong
existing relationships to help customers navigate their move to the
cloud at scale.
Larger corporates, which may already use the cloud today, are
progressively moving away from complex systems based on their own
servers or single cloud solutions, to multi-cloud offers sold by
network operators and their partners. This approach reduces supplier
risk and increases corporate agility and resilience. Large corporates
continue to drive higher demand for robust, secure and efficient
connectivity services as they transition from their own legacy
hardware and services. Cloud providers also recognise the criticality of
telecommunications networks. Many cloud providers are partnering
with the largest network operators, sometimes through revenue
sharing agreements, to develop edge computing solutions which
integrate data centres at the edge of telecommunication networks to
deliver customers reduced latency. The opportunity is significant, as
the total addressable market in business-to-business cloud and
security is expected to reach €86 billion by 2028 compared to €47
billion today.
Consumers use cloud solutions for a variety of reasons, including
digital storage, online media consumption or interacting through the
metaverse. Consumer hardware can also in some cases be replaced
by cloud-first solutions. For example, new cloud-based gaming
services allow consumers to stream complex, bandwidth-heavy
computer games directly to their phones or tablets, without the need
for expensive dedicated hardware. Fast and reliable connectivity will
act as a catalyst for further innovation and consumer applications,
many of which do not yet exist today.
Click or scan to learn more
about our cloud technology
in our technology investor
briefing:
investors.vodafone.com/
vtbriefing
Click to read more about our six-
year strategic partnership
with Google:
investors.vodafone.com/
google-strategic-partnership
Click or scan to learn more
about how Vodafone is
working with AI:
investors.vodafone.com/
artificial-intelligence
Click to read more about our
10 -year strategic partnership with
Microsoft:
investors.vodafone.com/
microsoft-strategic-partnership
Read more about Vodafone’s
approach to responsible AI
on page 46
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Stakeholder engagement
Engaging regularly with our stakeholders
is fundamental to the way we do business
Regular engagement ensures we operate in a
balanced and responsible way, in both the short
and longer term.
We are committed to maintaining good communications and building
positive relationships with all of our stakeholders, as we see this as
essential to strengthening our sustainable business.
Factors considered by Directors when
promoting the success of the Company
Disclosure
Location
The likely consequences of any
decision in the long term
Business model
pages 4 to 5
Key performance indicators
pages 6 to 7
Stakeholder engagement
pages 12 to 14
Our Purpose
pages 34 to 43
Maintaining Trust
pages 44 to 56
Risk management
pages 57 to 63
Governance
pages 70 to 121
The interests of the
Company’s employees
Key performance indicators
pages 6 to 7
Stakeholder engagement
pages 12 to 14
Our people strategy
pages 15 to 20
Our Purpose
pages 34 to 43
Maintaining Trust
pages 44 to 56
Our Company purpose, values and culture
page 80
Remuneration Committee, Remuneration Policy
and Annual Report on Remuneration
pages 98 to 118
The need to foster the Company’s
business relationships with suppliers,
customers and others
Business model
pages 4 to 5
Stakeholder engagement
pages 12 to 14
Chief Executive’s statement and strategic roadmap
pages 1 and 9
Our Purpose
pages 34 to 43
Maintaining Trust
pages 44 to 56
Risk management
pages 57 to 63
Board activities and principal decisions
pages 81 to 83
Supplier financing arrangements
pages 39 and 193
The impact of the Company’s
operations on the community
and the environment
Stakeholder engagement
pages 12 to 14
Our Purpose
pages 34 to 43
Climate-related risk
pages 64 to 69
Contribution to UN Sustainable Development Goals
page 43
Maintaining Trust
pages 44 to 56
ESG Committee
pages 96 to 97
The desirability of the Company
maintaining a reputation for high
standards of business conduct
Stakeholder engagement
pages 12 to 14
Maintaining Trust
pages 44 to 56
Governance
pages 70 to 121
The need to act fairly as between
members of the Company
Stakeholder engagement
pages 12 to 14
Governance
pages 70 to 121
Shareholder information
pages 249 to 254
Vodafone is required to provide information on how the Directors
have performed their duty under section 172 of the Companies Act
2006 to promote the success of Vodafone, and these matters are
covered throughout this Annual Report and summarised in the table
below. This includes how those matters and the interests of
Vodafone’s key stakeholders have been taken into account by the
Directors.
We have also summarised our interactions with key stakeholders
during the year in this section. The engagement mechanisms directly
involving the Directors are indicated below with a B symbol.
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Our customers
We are focused on deepening engagement with our customers to
develop long term, valuable and sustainable relationships. We have
hundreds of millions of customers across our global footprint, from
individual consumers to large multinationals.
How did we engage with them?
– Digital channels, call centres and branded retail stores
What were the key topics raised?
– Easy access to high quality support and shorter resolution times for
service related issues
– Better value offers for long-term customers and improved
transparency around price increases
– Fast and reliable fixed internet, wider mobile coverage and faster
5G connectivity
How did we respond?
–
B Customer experience (‘CX’) is our top priority, with global
alignment behind a customer action plan and increased investment
to improve experience
– CX boards in all markets, continuously review customer pain points
and take action with dedicated budgets
–
B Increased awareness of customer issues and challenges faced
by the frontline through initiatives such as call centre site visits
– Continued to improve digital channel effectiveness and focused on
enhancing the service experience delivered by our frontline
– Drove affordability of smartphones and home technology by
introducing integrated trade-in, flexible financing and second-life
refurbished devices
– Offered support, such as free voice calls and texts, to customers
affected by the tragic earthquake in Morocco and the devastating
flooding in Libya
– Expanded our 4G and 5G coverage
– Continued progress towards closing the mobile usage gap for
people across Europe and Africa
– We completed the world’s first space-based 5G call on a
conventional smartphone with AST SpaceMobile
Our people
Our people are critical to the successful delivery of our strategy. It is
essential that they are engaged and embrace our purpose and values.
Throughout the year we focused on a number of areas to ensure that
everyone is highly motivated, and we remained focused on wellbeing,
diversity and inclusion and employee engagement.
How did we engage with them?
– Regular meetings with managers
–
B European Employee Consultative Committee
–
B Vodacom Group Employee Engagement Forum
–
B Executive Committee discussions
–
B Internal website, live webinars, newsletters and other
communications posted on our internal digital platform called
’workplace’
–
B Employee Speak Up channel
–
B Global employee surveys, including onboarding and exit surveys
What were the key topics raised?
– Market mergers and acquisition activity
– Customer feedback
– Performance management and career development
– Succession and talent development
– Global Pulse and Spirit Beat survey actions
– Leadership behaviours to support strategic priorities
– Ownership and active engagement around safety, health and
wellbeing, including mental health
– Progress on diversity and inclusion
How did we respond?
– Regularly updated employees on business and trading updates
– Launched advanced and intermediary training for critical skills
– Embedded our new performance management approach
– Updated our succession and talent framework
– Refreshed manager learning and support guides
– Launched a new global senior leadership activation programme
– Remained globally committed to safety, health and wellbeing
– Continued to embed diversity and inclusion through attraction,
retention, development, allyship and education
Our suppliers
Our business is helped by 8,000 suppliers who partner with us. These
range from start-ups and small businesses to large multinational
companies. Our suppliers provide us with the products and services
we need to deliver our strategy and connect our customers
How did we engage with them?
– Supplier audits and assessments
– Safety forums, events, conferences and site visits
– Purpose criteria in tenders relating to planet, diversity and safety
What were the key topics raised?
– Driving health and safety standards
– Driving towards net zero emissions in supply chains
– Supplier and product innovation
How did we respond?
– Held quarterly safety forums
– Collaborated with industry peers and suppliers through the Joint
Alliance for CSR (‘JAC’)
– Continued rollout of environmentally-linked supply chain finance
programme
Our local communities and non-governmental
organisations (‘NGOs’)
We believe that the long-term success of our business is closely tied to the
success of the communities in which we operate. To achieve this, we engage
with local communities and international NGOs across our markets.
How did we engage with them?
– Providing relevant products and services
– Collaboration on education, health and inclusive finance projects,
and on our humanitarian response to global issues including the
cost-of-living crisis and war in Ukraine
– Participation in multi-stakeholder working groups on policy issues
at national and international level
What were the key topics raised?
– Increasing access to connectivity and digital services, by closing
the digital divide, connecting more women, and connecting SMEs
– Human rights topics
– Environmental topics, including net zero, biodiversity and the
circular economy
– Delivery of global and national development goals including the
UN Sustainable Development Goals (‘SDGs’)
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How did we respond?
– Engaged with the UN Broadband Commission, with Vodacom CEO
Shameel Joosub elected as Commissioner
– Co-chaired an area of the International Telecommunication Union’s
Partner2Connect initiative and contributed to the UN’s ‘SDG Digital
Day’
– Participated in industry working groups covering human rights,
smartphone access, digital inclusion and biodiversity
– Engaged with environmental initiatives, including the Science
Based Targets initiative, CDP, and our WWF partnership
Governments and regulators
Our relationship with governments and regulators is important and
we hope to work together on policies impacting our industry and
customers, while also enabling governments and regulators to better
understand the positive impact we can have on the environment and
communities we operate in.
How did we engage with them?
–
B Held meetings with EU institutions, governments, elected
representatives, international organisations and regulators
–
B Hosted and participated in workshops and events to improve
sector understanding of connectivity and digitalisation; wrote a set
of white and non-papers
–
B Our Chair chairs the European Round Table for Industrialists,
which engages with European and global institutions, and
governments
–
B Promoted Vodafone’s interests through membership
organisations and trade associations
What were the key topics raised?
– Regulatory and policy environment
– Security and supply chain resilience
– Data protection and privacy in regards to artificial intelligence
– Level playing field, sectoral health of the telecommunications
sector, market structure, market consolidation and competition
– EU single market for the telecommunications industry
How did we respond?
– Engaged on network investments, design and deployment,
allocation of spectrum (especially 6GHz) and the protection of
consumers, future of satellite
– Promoted the need for telecommunications supply chain resilience
and diversity, including highlighting the important role of OpenRAN
– Engaged with the EU with respect to the data economy, including
data protection, digital principles, and data sharing (including the
EU AI Act, Cyber Act and Digital Decade targets)
– Participated in the fair share debate through responding to the
European Commission consultation on the Future of Connectivity.
– Inputted to the Commission White Paper and upcoming reports on
competitiveness and the single market.
Click to read more about our social contract in our investor briefing. The materials
set out why a reset of the European regulatory framework is so important; how
through our social contract we have taken a leadership role in improving our
relationship with governments and policymakers; and what is needed in terms of
policy reform: investors.vodafone.com/social-contract
Our investors
Our investors include individual and institutional shareholders as well
as debt investors. We maintain an active dialogue with our investors
through our extensive investor relations programme.
How did we engage with them?
–
B Personal meetings, roadshows, conferences
–
B Annual and interim reports and presentations
–
B Our investor relations website is used as our primary digital
communications tool and is available to all shareholders
(institutional and retail), including 13 hours of dedicated video
content covering investor events and interviews with Board
Directors
– Regulatory News Service (‘RNS’) announcements
–
B Annual General Meeting (‘AGM’)
–
B Investor perception study and regular feedback survey
– Online presentations aimed at retail investors, hosted by the UK
Individual Shareholders Society in FY24 and ‘Investor Meet
Company’ in FY25
– Our Registrar, Equiniti, operates a portfolio service which provides
shareholders with the ability to manage their holdings
What were the key topics raised?
– Our new strategic roadmap and strategic priorities of Customers,
Simplicity and Growth
– Allocation of capital, including capital investment, leverage and
shareholder returns
– Portfolio right-sizing for growth
– Corporate governance practices
– Environmental, Social and Governance (‘ESG’) strategy, targets and
reporting
How did we respond?
– We conducted over 1,000 investor interactions through meetings
with major institutional shareholders, debt investors, individual
shareholder groups and financial analysts, and attended
conferences
– Meetings were attended by Directors and senior management,
including our Chair, Group Chief Executive, Chief Financial Officer,
and Executive Committee members
– Provided comprehensive reports and transparency disclosures on
ESG matters
Click to read more on our investor website:
investors.vodafone.com
Stakeholder engagement (continued)
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Our people strategy is to create an inclusive
environment for growth where everyone has the
opportunity to thrive and belong. Our engaged and
experienced teams are a key strength and will
support us through the transformation of Vodafone.
The ‘Spirit of Vodafone’
Our culture – the ‘Spirit of Vodafone’ – outlines the beliefs we stand
for and the behaviours that enable our strategy and purpose.
We foster our culture by developing behaviours that reinforce our Spirit,
investing in leadership development to role-model our beliefs, and
ensuring systems, processes and milestone activities are aligned with
the ‘Spirit of Vodafone’. We measure our progress and identify where to
take action via a bi-annual employee survey called ‘Spirit Beat’. In our
latest Spirit Beat survey in April 2024, we had an 88% response rate and
strong scores in engagement, connection to purpose, and Spirit.
Spirit Beat surveys
Measurement
April 2024
May 2023
Engagement
75
75
Purpose
88
88
Team Spirit Index1
85
84
Response rates
88
88
Note:
1. The Team Spirit Index represents an overall view of how people are doing on the ‘Spirit
of Vodafone’ and takes into account each of our Spirit Behaviours. It allows us to understand
how successful we have been in embedding these behaviours when working with each other,
our customers, and the communities in which we operate.
The ‘Spirit Beat’ survey measures our progress on culture change with
a focus on supporting employees to deliver our priorities of
Customers, Simplicity and Growth through Spirit. The ‘Spirit Beat’
results show that teams are becoming more engaged, connected to
our strategy, and have clarity on their goals. Managers who act on
Spirit outperform those who do not take action by 20 points on Team
Spirit Index and 26 points on Engagement. We support our managers
to lead with Spirit and continue to take action on survey results
through development programmes, training and resources. In
November 2023, over 900 managers attended training on taking
action on Spirit.
We continue to evolve our employee listening strategy and deepen the
connection between employee and customer experiences. As
Vodafone transforms, we use pulse surveys to measure the
understanding of our strategy; between June and September 2023,
84% of teams understood and 80% were connected to our strategy.
Onboarding feedback shows new hires are connected to our strategy
and 87% reflect Spirit behaviours, while 84% positively rated their
onboarding experience. Feedback shows that 69% of leavers would
recommend Vodafone as a great place to work.
To improve customer experience, we have deepened our
understanding of our frontline colleague experience. Spirit Beat
results from April 2024 showed the Engagement score was 75% and
Team Spirit Index 85%. Outsourced contractors who serve our
customers also had an opportunity to participate in ‘Spirit Beat’: 65%
responded, an increase of nine percentage points from May 2023.
Insights obtained have been used to inform our overall customer
action plan, designed to improve the frontline and customer experience.
‘Spirit of Vodafone Day’ takes place once a quarter with dedicated
time to focus on connecting with our customers. During those days,
learning hours increase on average by two times compared to other
days in the year. Employees use the ‘Spirit of Vodafone Day’ to connect
with the customer experience through customer-focused learning and
local activities.
Diverse talent and skills
The Vodafone Learning Organisation (‘VLO’) operates across all our
operations to deliver high-quality learning that supports diverse talent
to develop the skills required to transform Vodafone. This is reflected
in the four strategic pillars summarised below.
1. Enable a high-impact performance and learning culture
We continue to support the professional growth of people through
online learning. This year our learning and career development
platform ‘Grow with Vodafone’ was recognised in the Learning
Technologies Awards, winning gold for ‘Best Learning Technologies
Project – Commercial Sector’, and silver for ‘Best Advance in Learning
Management Technology’ at the Brandon Hall Excellence awards.
During the year, our employees spent 2.7 million hours on learning,
with an average of 225,000 hours per month. The annual average
number of hours per employee has increased by 74% since FY23,
with each employee now spending 32 hours on average per annum
on their learning. We invested an average of €386 in both mandatory
and non-mandatory training for each employee to build future capabilities.
In April 2023, we launched a new performance management
framework called ‘Grow my Impact’ to align employee goals to
strategic priorities and assess performance based on individual
impact. Grow my Impact introduced a mid-year check-in to
encourage managers to have growth and career conversations with
their direct reports and provide feedback on how they are tracking
against their goals. We also refreshed our talent rating framework to
support consistent decision-making. The new framework allows us to
recognise a larger population of individuals with potential for bigger,
more complex roles and to better differentiate between types of
potential to provide tailored and value-adding development support
to distinct groups. This also includes identifying those of our
employees with critical skills. To emphasise that leaders are
accountable for strengthening talent across Vodafone, all leaders
must now have a ‘Grow Others’ goal. To recognise varying levels of
impact and talent, year-end ratings drive reward outcomes for bonus
and share awards for eligible employees. Eligibility to receive a bonus
is underpinned by minimum performance standards that include the
completion of our compliance training called ‘Doing What’s Right’.
2. Build the skills for the future
This year we launched and delivered our ‘Skill Accelerators Labs’
across the organisation to develop critical skills such as agile project
management, software engineering, automation, and cyber security.
8,000 employees have already completed these programmes. In May
2023 we also introduced a global software engineering reskilling
programme to equip employees to move into a new role within
Vodafone. Our technical career path (‘TCP’) supports the attraction,
retention and development of our technical experts and sits alongside
a leadership career path. The TCP is designed to provide more formal
ways to recognise and reward technical experts, giving choice in
career direction.
Following our FY23 review of our leaders’ commercial capabilities,
current and future leaders were assessed against the skills we need
for the future and targeted development and learning plans were
subsequently created to close any gaps. To enable the development
of broader skills, we continue to launch and refresh content with
licensing partners, accessed by 28,000 employees this year.
Click to read our technology employee articles:
careers.vodafone.com/life-at-vodafone/projects-stories
3. Drive an efficient engine with the scale and expertise to
deliver our growth ambitions
We continue to simplify VLO operations by scaling training
partnerships with vendors and consolidating duplicate work into our
expanded _VOIS shared services team. We also conduct global
demand planning to ensure our learning investments reinforce our
strategic objectives.
Our people strategy
Our people strategy
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Our people strategy (continued)
4. Engage and retain diverse talent, and unlock potential
through focused succession and people development
Our Group Chief Executive and Chief Human Resources Officer conducted
a series of Succession and Talent Acceleration Review (‘STARs’)
meetings with the market and functional CEOs and HR Directors
during the year. These meetings discussed the Senior Leadership
Team (‘SLT’) succession plan for employees identified as key talent.
Those in the ExCo succession and talent acceleration pool, which
includes 44% women, receive one-to-one support, including
leadership assessment, development planning, and coaching.
To strengthen our market or functional CEO succession pipeline, we
have also established a programme to support 15 senior leaders who
have the potential to become a CEO in the next three to five years
obtain the skills, experience, and exposure required.
To increase our understanding of employees identified as key talent
across the rest of the business, 167 senior leaders at senior
management level completed leadership development assessments
to help inform talent decisions. They also attended development
planning sessions to grow their impact and prepare for future roles.
Leadership development
Leadership is essential to enabling transformation, and we continually
invest in developing inclusive leaders who drive growth and
innovation, act as role models, coach and empower teams, and
lead with Spirit. Programmes delivered this year include:
– ‘Vodafone Leader Labs’, attended by our top 182 ExCo and SLT leaders
to enable the leadership shifts required to deliver our strategy;
– ‘Leading for Customer Loyalty’, attended by leaders to deepen their
connection with customers and shape a customer-centric culture; and
– ‘CEO Accelerator Lab’, attended by 11 market CEOs to support their
transition as newly appointed CEOs. This included assessments,
one-to-one coaching, leadership training and business mentoring.
To complement these programmes, leaders also use coaching and
assessment tools digitally and on-the-go.
Digital and personalised experience
Office space
The shift to hybrid working has redefined the role of the office and inspired
us to create a new global office design primarily for collaboration and
connection. We have improved the digital workplace experience with new
booking systems for desks and collaboration spaces, access control, video
conferencing and presentation facilities. Last year we opened an innovation
campus in Málaga in collaboration with the University of Málaga; we
refurbished a listed building to update it to the newest technology.
Employees work there with university students, fostering greater
opportunities to collaborate on innovations. This is a great example of the
hybrid workplace improving employees’ experience and attracting talent.
We continued to enable remote working through our ‘Office in a Box’
initiative, which was implemented to support employees’ wellbeing
while working from home. This provides a virtual office set-up at
home following a self-assessment.
Digital experience
We remain focussed on digitally transforming the people experience
and evolving ways of working to accelerate the execution of the
people strategy and deliver simplicity, efficiency and an enhanced
experience across people processes. This has been driven by global
initiatives across the people life cycle.
The award-winning Artificial Intelligence (‘AI’) enabled Grow with
Vodafone platform continued to create hiring efficiencies and optimise
the recruiter, hiring manager and candidate experience, enabling:
– Increased diversity through tailoring job recommendations for
candidates and removing bias through anonymous candidate
recommendations;
– Improved recruiter efficiency through simplified navigation between
tools and candidate recommendations based on required skills.
This resulted in a reduction in time-to-hire from 50 days to 48 days; and
– A simplified and faster application process through personalised
skills-based job recommendations and a 78% reduction in questions.
This resulted in 78% of applications moving to submission stage.
To attract, retain and support diverse talent more consistently, this
year a new global talent acquisition policy was launched and our
onboarding tool was also enhanced with new features to provide a
simpler and more personalised experience for new joiners, driving
engagement. This is enabled by automated and tailored notifications,
including the use of SMS in the UK, which has led to a journey
effectiveness score of 87%.
A key priority for Vodafone is having a clear and robust strategic
workforce-planning process. As a result, we implemented a simple
and secure global headcount planning tool to improve accuracy,
reduce manual time and effort, and enable closer collaboration
between those involved in the process. The tool is available in
majority of markets and Group functions1, allowing users access to
gain experience with the new system.
To improve the speed and effectiveness of HR admin support for
employee queries and transactions, our HR chatbot has been scaled
and is now adopted across Vodacom, _VOIS India, the UK, Group UK,
Romania, and _VOIS Romania. The chatbot receives 67% of queries
across all channels, with an average first-time resolution of 53% and
an employee Net Promoter Score of 75.
We are closely following AI and Generative AI advancements in the
market and, based on pilot findings, we are working with multiple
external experts to harness the potential for integration with HR
processes. The top four use cases selected include: automating query
resolution; driving deeper people data insights; enhancing learning
and talent acquisition content and removing bias; using AI-enabled
search and recommendations to find the best candidates, as well as
learning content and career opportunities for employees.
We are enhancing the people data analytics team’s capability with the
implementation of a global HR data lake using Google Cloud Platform.
This is now live for all markets except Germany and enables standardised
insights and dashboards, reducing the need for manual reporting. This
is supported by high-quality people data managed through a data
quality tool, which checks and corrects HR data against pre-set rules,
with 100% error resolution since its launch in FY23.
To complement the changes in the digital ecosystem, we have
continued to invest in our ways of working. We introduced a global
service model for the hiring of employees at executive management
level (SLT and senior managers), which has led to a more standardised
and efficient process. We are also transforming the HR business
partnering support model in an agreed set of markets to improve its
effectiveness. HR business partners will focus on strategic activities,
while transactional HR activities will transfer to _VOIS.
To optimise HR services, we continue to re-locate activities conducted
in markets (including selected learning and development tasks and
resourcing admin tasks) to _VOIS. This will improve service quality at
scale while creating savings of €0.6 million. A transformation plan was
also executed to ensure _VOIS readiness to receive the activity in
preparation for the future service offering.
Note:
1. The headcount planning tool is available for: Albania, DRC, Egypt, Greece, Group Commercial,
Group Corporate Functions, Group Technology, Lesotho, Portugal, Romania, South Africa,
Tanzania, Turkey, and the UK.
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Pay and benefits
As part of the people experience, we continue to ensure pay, benefits
and wellbeing propositions are competitive and fair. Pay is typically
reviewed on an annual basis, with increases aligned to an individual’s
level of skills and experience, as well as external factors like market
competition and inflation. Our total reward approach also encourages
collective performance and ‘in-the-moment’ recognition. For example,
22,253 peer-to-peer ‘Thank You’s’ and 58,951 cash ‘Vodafone Star’
awards were issued through a digital recognition tool during the year.
We continue to apply Fair Pay principles across all markets, working
with the WageIndicator Foundation to ensure a good standard of
living in each market. In the UK, our commitment to these principles is
reflected in being an Accredited Living Wage employer.
Click to read more about Fair Pay at
Vodafone: vodafone.com/fair-pay
Read more about our Fair Pay
principles on page 113
Our people
We are developing a diverse and inclusive global workforce that
reflects the customers and societies we serve.
Key information
2024
2023
Average number of employees1
85,887
83,186
Average number of contractors1
6,848
8,225
Number of markets where we operate
15
15
Employee nationalities
146
146
Footprint: Operating segments
Germany
17%
18%
UK
11%
11%
Other Europe2
13%
14%
Africa2
16%
16%
Turkey
4%
4%
Shared Operations (_VOIS)3
33%
29%
Corporate Services
5%
5%
Central Business Units
3%
4%
Employee experience
Employee engagement index4
75
75
Alignment to purpose4
88%
88%
Voluntary turnover rate5
9%
12%
Involuntary turnover rate5
3%
4%
Average number of employees
from continuing operations
85,887
83,186
Notes:
1. All headcount figures exclude non-controlled operations such as those in the Netherlands,
Kenya, Australia and India. Further information on how headcount is defined and calculated
can be found in the ESG Addendum Methodology document: investors.vodafone.com/
esgmethodology. Calculation considers pro-rated headcount.
2. Other Europe reflects employees based in Albania, Czech Republic, Greece, Ireland, Portugal,
and Romania. Africa reflects employees based in Vodacom Group, including Egypt.
3. Shared Operations constitute a significant number of employees. The figures presented
above include _VOIS headcount across our footprint (Albania, Egypt, Hungary, India, Portugal,
Romania, Turkey and Spain).
4. More detail on the employee survey is included on page 15. The employee engagement
index is based on an average index of responses to three questions: satisfaction working at
Vodafone; experiencing positive emotions at work; and recommending us as an employer.
Alignment to purpose is based on a single question that asks whether employees feel their
daily work contributes significantly to Vodafone’s purpose. Employee engagement index and
purpose alignment scores reflect April 2024 and May 2023 data.
5. The voluntary turnover rate includes retirements and death in service. Further information on
how voluntary and involuntary turnover has been calculated is included in the ESG Addendum
Methodology document: investors.vodafone.com/esgmethodology.
Simplified operating model
We continued to simplify our operating model. For example, the
establishment of the Vodafone Shared Operations business, which will sell
and deliver a portfolio of services to Group, operating companies, and other
customers, via an arm’s length commercial model based on Price x Quantity
x Quality of Service. Separately, the Internet of Things (‘IoT’) Managed
Connectivity business is becoming a separate, standalone company within
Vodafone Group that will offer access to the Global Data Service Platform
(‘GDSP’) Managed Connectivity segment to Vodafone and new customers.
Where aspects of this internal re-organisation of Vodafone’s global IoT
business require notification and regulatory approval, we will be working
closely with the relevant authorities to obtain the necessary clearances. We
are also creating a unified global Vodafone Business team with our business
teams in operating companies to streamline prioritisation and decision-
making for our products and services.
Employee engagement
We have a number of employee forums where elected employee
delegates represent the views of their colleagues. During the year, the
Board’s Workforce Engagement Leads, Delphine Ernotte Cunci and
Christine Ramon, attended employee forums, such as the European
Employee Consultative Committee and the Vodacom Employee
Engagement Forum, to gather employee views. Key discussion topics
from the meetings included business development, customer
experience, growth, and reskilling opportunities.
The Group Chief Executive updates employees regularly on how we
are embedding and progressing our strategy and this is through a
variety of channels, including our internal digital platform ‘Workplace’.
These announcements include any changes to our market portfolio,
services, and organisation. Recently employees were informed of
changes to simplify our Executive Committee structure whereby all
European markets are now under the CEO of European Markets, and
joint ventures, partner markets, and telecom partnerships are now
consolidated under the CEO Vodafone Investments. Alongside the
Chief Commercial Officer and CEO Vodafone Italy; CEO Vodacom
Group; and, CEO Vodafone Business, these form the five Executive
Committee customer-facing units.
Read more about the Board’s engagement with the
employee voice on pages 77-78, and 83
Workers’ councils and union engagement
We respect freedom of association and recognise the rights of employees
to join trade unions and engage in collective bargaining in accordance
with local law. We continue to maintain strong relationships with workers’
councils and unions through their representatives, and we have 13,224
people covered by collective bargaining agreements across our global
footprint. Vodafone Germany employees, all covered by collective
agreements signed with unions, can register and participate in trade
union activities. They can elect or be elected into various union roles at
a local or national level. Across FY24, Vodafone Germany completed
more than 160 agreements across all levels1, with a focus on the
introduction of new IT tools, working conditions and transformation.
The latter includes a refreshed performance management framework.
Workplace equality
As part of our purpose, we aim to make the world more connected,
inclusive, sustainable, and a place where everyone can truly be
themselves and belong.
Diversity and inclusion
Our aim is to create an inclusive and equitable workplace for all. This year
we have sustained momentum on gender equality, accelerated focus
on LGBT+, race and ethnicity, and taken actions to better understand the
experience of neurodiverse people in the workplace. Our focus on inclusion
supports our ambition to create a global workforce that reflects the
customers, communities and colleagues we serve, and the wider
societies in which we operate. We believe that embedding equity and
inclusion to enable diversity is critical to achieving these goals in a
sustainable way.
Note:
1. With the exception of Vodafone Group Services Gmbh Germany (‘VGSG’).
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Embedding inclusion
Multiple employee networks operate across Vodafone including
Women, VodAbility, LGBT+ Friends, Parents & Carers and Multicultural
Inclusion. We actively support them, and this year we provided 29
network chairs and sponsors with specific leadership development
training focused on how to effectively create and assess a network’s
strategy, as well as how to be a visible and effective sponsor. Global
Withstander training continues to be delivered in 11 languages to upskill
employees on how to become active allies by challenging negative and
inappropriate behaviours when they witness them. Over 74% of employees
and 91% of managers completed the training in FY24. We continued
to engage with colleagues and raise awareness of why inclusion matters.
During the year, we held global sessions on diversity and inclusion
topics and these received over 10,0001 viewers across all markets.
Gender diversity
Goal: We aim to have 40% women in management roles by 2030.
We have reached 35%, which is on track towards our ambition. We continue
to drive progress through programmes, policies and leadership incentives.
2024
2023
Women on the Board
42%
54%
Women on the Executive Committee
33%
33%
Women in senior leadership positions1
37%
34%
Women in management and senior
leadership roles2
35%
33%
Women as a percentage of external hires
44%
40%
Women as a percentage of graduates
53%
44%3
Women as a percentage of employees4
39%
39%
Notes:
1. Percentage of senior women in our top 135 positions includes the Executive Committee
and Senior Leadership Team (FY23: 158).
2. Percentage of women in our 6,350 management and leadership roles (FY23: 6,328).
3. Includes Vodafone Italy and Vodafone Spain.
4. Percentage of women based on 85,225 total employees (FY23: 93,095). The total number of
employees represents the position on 31 March for the applicable year and excludes
employees that left the Company after this date. The numbers do not represent pro-rated
headcount. Further information on how employees are defined and calculated can be found
in the ESG Addendum Methodology document: investors.vodafone.com/esgmethodology.
We work to ensure there is gender diversity when resourcing for
senior leadership roles, and our leadership team is accountable for
maintaining diversity and inclusion in their teams. Women in
management targets are also embedded in our long-term incentive
plans.
Across youth programmes, 49% of hires were women. We have also
now connected with over 15,000 girls via the digital skills programme
‘Code Like a Girl’ since 2017. We support managers on inclusive hiring
practices through training and by embedding inclusion in our talent
acquisition systems. This includes the introduction of blind CVs, which
exclude personal details such as the candidate’s gender and age.
Domestic violence
Our global domestic violence policy sets out comprehensive workplace
resources, support, security, paid safe leave and other measures for
employees at risk of experiencing, and recovering from, domestic violence
and abuse. We expanded our support by creating an allyship programme
for domestic abuse survivors. This expands training beyond HR and line
managers to all employees, including our frontline workforce, on how
to recognise the signs of abuse, respond, and refer survivors to support.
Menopause
Our external research identified that 62% of women with symptoms
of menopause found that it impacted their work. We are committed
to supporting women experiencing menopause, including providing
a global toolkit, which is freely available to download externally, and
menopause e-learning on common symptoms’ impact to work.
Our people strategy (continued)
Maternity and parental leave
Our global maternity and parental leave policies are available across
markets, providing 16 weeks of fully paid leave with a phased return
to work over six months, where parents work the equivalent of four
days and are paid for five days. This policy is open to all employees
regardless of sex, gender identity, sexual orientation, length of service,
and whether they or their partner is having a baby, or they are
welcoming a child through surrogacy or adoption. This year, over
2,300 women have taken our maternity leave and over 2,500 men
have taken parental leave, with 72% of the latter taking four or more
weeks of leave. Of those who identify as LGBT+, 5% have taken
parental leave. In addition, 70% of employees remained with
Vodafone 12 months after their return from parental leave.
LGBT+
We accelerated our focus on supporting our LGBT+ community with
2,700 allies and active support from senior executive sponsors. For
the first time we included the question ‘Are you out at work?’ as part
of our Spirit Beat survey to better understand experiences of our
LGBT+ employees in the workplace2. 44%3 of our LGBT+ community
are out at work. To further support them, we launched a guide for
managers and colleagues to support employees coming out in the
workplace and have also updated our LGBT+ travel toolkit advising on
safe travel. In addition, we launched the pronoun functionality in
Microsoft Teams and Outlook on the web; this gives employees the
option to easily add their preferred pronouns to their profile. The
Vodafone Foundation continues to promote the Zoteria app in the
UK, which helps the LGBT+ community and the wider public to come
together and tackle the issue of LGBT+ hate crime.
Accessibility in the workplace
During the year, we upskilled our people through continued promotion
of and education about the accessibility features available within
Microsoft 365. We also have accessibility guidelines, which are reinforced
through workshops and training for developers. Assessments continue
to be conducted to improve the accessibility of our own products.
We have seven sessions available and hosted a podcast to promote
accessibility in the digital workplace.
Vodafone took part in research to understand the experience of
neurodiverse people in technology, along with Colt, Samsung, and Nokia,
as part of the #ChangeTheFace alliance. The aim was to provide
insights for employers to support neurodiverse people in the workplace.
Race, ethnicity and cultural heritage (‘REACH’)
We continue to promote greater workplace inclusion through allyship and
anti-racism. REACH executive sponsors continued to be appointed across
our markets, and REACH fluency training continued to be adapted to local
contexts and rolled out in our European markets. This year, we extended
the McKinsey Black, Asian, and Hispanic/Latino Leadership Programmes to
all our markets with over 500 signing up to the sessions so far. In 2020, we
set ethnic diversity targets at leadership level, presented below.
Ethnic
category
31 March
2024
Long-term
ambition
Population
Global
Ethnically diverse
background
20%
2030:
25%
Global Senior Leadership
Team (123 positions)
UK
Black, Asian, other
diverse ethnicities
16%
2025:
20%
UK-based senior leadership
and management
(1340 positions)
UK
Black
2%
2025:
4%
South Africa
Ethnically diverse
background
71%
2030:
75%
South African-based
senior leadership and
management
(412 positions)
Notes:
1. Includes Vodafone Spain and Vodafone Italy.
2. Markets not asking LGBT+ questions include: DRC, Tanzania, Turkey, and Egypt; the latter also
does not ask ethnicity questions.
3. Includes Vodafone Italy.
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Leadership diversity
To better understand representation across the organisation and
inform our diversity and inclusion programmes, we use ‘#CountMeIn’,
an initiative that encourages employees to voluntarily self-declare
their diversity demographics. These include race, ethnicity, disability,
sexual orientation, gender identity, and caring responsibilities, in line
with local privacy and legal requirements1. Our senior leadership
positions have the highest self-declaration rate at 75%, and this
enables transparency about our diversity at senior leadership level.
Read more about Board and executive management
diversity on pages 87 and 88
Gender
identity1
Sexual
orientation2
Ethnic
diversity3
Disability4
Representation in senior
leadership positions
0%
3%
24%
3%
Notes:
1. Self-identification of gender identity, including trans and non-binary identities, excluding cisgender.
2. Lesbian, gay, bisexual, and other sexual orientations, excluding heterosexual.
3. Asian, Arab, Black/African/Caribbean, Latinx, mixed ethnic groups, and ‘other’ identities.
4. Self-identification of disability, including long-term conditions and visible and non-visible disabilities.
Policies, initiatives and targets
Our commitment to diversity and inclusion is reflected across our
global policies and principles, such as our code of conduct and fair
pay principles.
Click to read more about Fair Pay at
Vodafone: vodafone.com/fair-pay
Read more about our Fair Pay
principles on page 113
The achievement of our diversity targets is dependent on the
attraction, engagement and retention of diverse talent and skills. To
support this, we have inclusive initiatives such as: hybrid and flexible
working, parental leave, a mental health toolkit, learning and
development programmes, allyship training, and menopause support,
reinforced by the work of employee networks and executive sponsors.
We refreshed our training for hiring managers and recruiters to
support an inclusive candidate experience from application to offer
stage. Programmes are designed to help employees through all life
stages and challenge societal norms to create an environment where
everyone can contribute at their best and thrive.
Read more about diverse talent, future-ready skills and personalised employee
experience on pages 15 and 16
Safety, health and wellbeing
Nothing is more important to us than the safety, health, and wellbeing
(‘SHW’) of our customers, communities, employees, and suppliers. We
have a simple global commitment: no one gets hurt. This has been
captured in our refreshed Global Commitment Statement which is
supported by a video message from our Group CEO.
Our SHW framework provides a consistent approach to safety leadership,
planning, performance monitoring, governance, and assurance.
Risks
We continue to focus on our key risks, which account for the majority
of reported incidents and remain amongst our top priorities:
occupational road risk, falls from height, working with electricity,
and civil works.
In recognition of our key risks, we continue to use the ‘Vodafone
Absolute Rules’. These rules focus on risks that present the greatest
potential for harm for anyone working for or on behalf of Vodafone.
The Absolute Rules apply everywhere we work and provide clear
expectations for safe behaviour for everyone to follow. The Absolute
Rules must be followed by all Vodafone employees and contractors,
as well as our suppliers’ employees and contractors. Where this
requirement is not met, we take appropriate management action. In
the April 2024 Spirit Beat survey 94% of employees agreed that the
Absolute Rules are taken seriously at Vodafone.
Leadership engagement
Our Group Executive Commmitee (‘ExCo’) and operating company ExCo’s
provide visible and clear leadership in SHW. Our senior leaders are
actively engaged and carry out regular face-to-face safety
engagement throughout the year. Our leaders recognise the
importance of connecting with teams and frontline workers as they
continue to maintain our networks and work in our retail stores and on
customer sites. We encourage our people to raise any concerns or
ideas for improvements in SHW and ensure the support of our leaders
when they do so.
We continue to mandate our ‘Leading for Health & Safety at Work’
e-learning module. This module sets out the specific impact we
expect our leaders to have. On 31 March 2024, 93%2 of assigned
leaders had completed the module.
Supplier engagement
Most of our high risk work is carried out by suppliers on our behalf.
Engagement and collaboration is essential to achieve our common
goal of protecting people. We have held quarterly forums with our
global suppliers for the last 10 years to develop common ways of
working and share best practice. This year we held four in-person
safety forums with our larger global suppliers. This year our forums
have worked on collaboration with suppliers via work streams on
improving how work is supervised on site, improving driver safety, and
managing the risk of sub-contracting.
Community engagement
We play an active role in the communities where we conduct our business
and as a result we have various community focused safety programmes.
In Mozambique, a road safety campaign was conducted. The
campaign involved the Chairman of the Mozambican Traffic Police,
and the Vodafone Mozambique safety team. The event took place in
the main transport corridor at critical points identified with a higher
occurrence of accidents.
In Lesotho, a radio campaign was run focusing on Vodacom Absolute
Rules and pedestrian safety, with the key message ‘#NoOneGetsHurt’.
This was aired on five national radio stations over three weeks.
In Tanzania, we worked with five selected primary schools that were
identified as exposed to high road risk. Our road-education
programme reached 6,745 students and 100 junior traffic patrol
officers were appointed and trained.
In Greece, road safety events were held during April and May in
collaboration with the Road Safety Institute. More than 550
employees, building tenants, and children participated in safety
training using simulators. We also installed automated external
defibrillators in six of our premises, which are available to all tenants.
Governance
SHW is managed through a global framework. This includes the
monitoring and assessing of risks, setting targets, reviewing progress,
and reporting performance. Our global framework is based on
international standards for occupational health and safety. It is
aligned to internationally recognised best practice and always meets
or exceeds local requirements. In addition, five of our European local
markets, one Vodacom market, and four _VOIS locations have chosen
to undergo independent external certification to ISO 45001, the
international standard for occupational health and safety.
All incidents relating to key risks or breaches of the Vodafone
Absolute Rules are reported and investigated within the timescales
contained in our Incident Reporting Standard. We ensure that
Notes:
1. #CountMeIn is not live in Mozambique.
2. Figure includes Vodafone Italy and Vodafone Spain.
19
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Annual Report 2024
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Our people strategy (continued)
incidents are investigated in accordance with their severity, and
appropriate remedial actions and improvements are identified and
implemented. We strongly believe in the importance of prevention
and we also believe that every incident should be treated as an
opportunity for learning and improvement.
SHW is a global policy and is included within our global risk and
compliance governance programme. This year we continued
in-country audits and remote validation continued as a
complementary process. Our eight audits focused on the control of
contractors and lifting operations across Europe, Africa, and Asia. Six
additional visits were made to our Europe and Africa markets to focus
on engagement and communication. They included a combination of
team meetings, site visits with contractors and suppliers and, where
applicable, verification checks following any serious incidents.
Training
We continue to include a health and safety module as part of our
mandatory ‘Doing What’s Right’ training. Every employee must
complete the training within six weeks of joining and then follow our
learning intervention cycle. During FY24, 96% of assigned Vodafone
employees completed the health and safety module.
Each local market is also responsible for delivering training that
supports the development of appropriate leadership skills, behaviours,
and identification of risks. Additional training is specific to an
individual’s role and aligned to each market’s local legislation.
Key performance indicators
We have a global set of key performance indicators which are reported
monthly to the Group ExCo and bi-annually to the Board:
– Number of fatalities;
– Number of employee lost-time incidents (‘LTIs’); and
– Near misses.
All fatalities that may be connected with our activities in any way,
including those affecting employees, suppliers and members of the
public, are formally reported to the Group’s ExCo and to the Board by
the Head of Safety, Health and Wellbeing.
Each incident is investigated to determine the facts and any actions
required to prevent recurrence. The investigation’s findings are
reviewed by the Chief Human Resources Officer at a formal review
meeting to ensure the thoroughness of the investigation, the
suitability of corrective and preventive actions, and to determine
whether the fatal accident was within Vodafone’s control or not. All
fatalities determined to be within Vodafone’s control are considered
‘recordable’ and are publicly reported.
Fatal accidents from FY20 onwards which had not reached
determination of recordability, due to ongoing legal processes, were
reviewed during FY24. Of these events three were determined to be
within Vodafone control and therefore recordable. The incidents were a
road traffic accident in Turkey in FY21, a fall from height in Italy in
FY22, and a gas explosion in Germany in FY23. There are no fatal
accidents awaiting determination from prior years.
Our aim is to ensure no one gets hurt. Any loss of life related to our
operations is unacceptable. It is therefore with great regret that we
record two fatal accidents this year.
The first recordable fatality occurred in South Africa when a supplier’s
vehicle struck a child that ran into the path of the vehicle. The injured
child was taken to hospital but sadly died. Support for the child’s
family has been provided in line with cultural and contractual
requirements via our supplier. The investigation identified that our
suppliers control of its fleet and driver operations required
improvement. Our supplier control and monitoring process had not
identified those weaknesses in these supplier’s controls prior to the
incident. Additional audits of field operations vehicle maintenance
and driver monitoring programmes are being undertaken as is
consequence management of the supplier company.
The second recordable fatality occurred in Mozambique when a
supplier technician fell from height. The technician was working at
the top of a tower when a bee swarm began to sting him. As he
descended he detached himself from his fall protection harness, went
into shock at around seven metres and then fell to ground level. The
review identified that the controls for managing natural hazards such
as bees could be improved. A safety directive to prohibit work in the
presence of bees has since been mandated across all Vodacom
markets. An industry leading innovative rescue from height practice
has been created by Vodafone and is being implemented across all
markets to allow safe descent even when incapacitated. Specialist
contractors are being used to remove bee swarms and only such
specialist contractors are permitted to work in the presence of bees.
Lost-time incident (‘LTI’) is the term we use when an employee or contractor
is injured while carrying out a work-related task and is consequently unable
to perform their regular duties for a complete shift or period of time after the
incident. During the year, 18 employee and contractors LTIs were reported.
In total these incidents account for 164 lost workdays.
Key performance indicators
2024
2023
Work-related injuries or ill health
(excluding fatalities)
Employees and contractors
18
13
Suppliers’ employees and contractors
8
14
Lost-time incidents (‘LTI’)
Number of lost-time employee and
contractor incidents1
18
13
Lost-time incident rate per 1,000
employees and contractors
0.19
0.14
Total recordable fatalities
Employees and contractors
0
0
Suppliers’ employees and contractors
1
0
Members of the public
1
12
Notes:
1. Lost-time incident means the loss of one or more workdays as a result of injury.
2. During FY24, an internal investigation into an incident during the year ending 31 March 2023 concluded
and an additional fatality is reported. This has been reflected in the reported figure for FY23.
Wellbeing
We remain focused on mental health and wellbeing. Training
and services are available in each market, including the provision of
employee assistance and psychological support services.
Our global wellbeing framework includes pillars for mental health,
physical health, and financial management. The framework is a guide
to help our people achieve optimal wellbeing and to ensure we all
have access to the best possible wellbeing resources across Vodafone.
Globally we delivered two online sessions on mental health to the Vodafone
Global Youth Connect Community (over 500 attendees). Youth Connect is
a network of over 20,000 under-30’s from across Vodafone’s markets.
In the UK, we continued the professional development of our Mental
Health First Aider Network, providing bi-monthly support and
education to over 300 trained volunteers. We delivered wellbeing
education to over 1,200 employees through online training and
face-to-face courses on anxiety, mindfulness and financial planning.
In Albania, Lesotho and the Democratic Republic of the Congo we
organised sessions on financial balance.
In South Africa, we launched a campaign during Mental Health Week,
consisting of personal mental health journeys together with our
wellbeing ambassadors. We placed primary healthcare nurses in our
four smaller regional clinics. We also launched mental health people
leader training. We hosted sessions throughout the year on a range of
topics including living a purposeful life, financial wellbeing, mental
health, mental illness, healthy boundaries, and suicide awareness.
Click to read more about mental health and wellbeing:
vodafone.com/wellbeing
20
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
– Total revenue: Declined by 2.5% to €36.7 billion due to the disposals of Vantage Towers, Vodafone Hungary and Vodafone Ghana in the prior
financial year and adverse exchange rate movements.
– Service revenue: Decreased by 1.3%, however on an organic basis, increased by 6.3%, with Europe, Africa and Business all growing. Excluding
Turkey, the Group had good service revenue growth of +3.7% on an organic basis.
– Operating profit: Decreased by 74.6% to €3.7 billion primarily reflects business disposals in the prior financial year, in particular the €8.6 billion
gain on disposal of Vantage Towers.
– Adjusted EBITDAaL: Increased by 2.2% on an organic basis as good service revenue progress was partially offset by higher energy costs and
other inflationary impacts. Excluding Turkey, adjusted EBITDAaL declined by 0.6% on an organic basis.
– Earnings per share: Basic earnings per share from continuing operations was 4.45 eurocents, compared to basic earnings per share of 43.66
eurocents in the prior year, primarily due to lower operating profit. Adjusted basic earnings per share was 7.47 eurocents, compared to 11.28
eurocents in the prior year, primarily due to lower adjusted EBITDAaL.
– Discontinued operations: Following the announcement that we entered into binding sale agreements with respect to the sales of Vodafone
Spain and Vodafone Italy, both businesses are now reported separately as discontinued operations in the consolidated financial statements.
Improved service revenue trends
Our financial performance
Click or scan to watch our Group Chief Executive, Margherita Della Valle and
Group Chief Financial Officer, Luka Mucic, talk about our financial performance in FY24:
investors.vodafone.com/videos
Group financial performance
FY241
€m
Re-represented2
FY23
€m
Reported
change %
Revenue
36,717
37,672
(2.5)
– Service revenue
29,912
30,318
(1.3)
– Other revenue
6,805
7,354
Adjusted EBITDAaL3,4
11,019
12,424
(11.3)
Restructuring costs
(703)
(538)
Interest on lease liabilities5
440
355
Loss on disposal of property, plant and equipment and intangible assets
(34)
(41)
Depreciation and amortisation of owned assets
(7,397)
(7,520)
Share of results of equity accounted associates and joint ventures
(96)
433
Impairment reversal/(loss)
64
(64)
Other income
372
9,402
Operating profit
3,665
14,451
(74.6)
Investment income
581
232
Financing costs
(2,626)
(1,609)
Profit before taxation
1,620
13,074
Income tax expense
(50)
(492)
Profit for the financial year - Continuing operations
1,570
12,582
Loss for the financial year - Discontinued operations
(65)
(247)
Profit for the financial year
1,505
12,335
Attributable to:
– Owners of the parent
1,140
11,838
– Non-controlling interests
365
497
Profit for the financial year
1,505
12,335
Basic earnings per share - Continuing operations
4.45c
43.66c
Basic earnings per share - Total Group
4.21c
42.77c
Adjusted basic earnings per share3
7.47c
11.28c
Notes:
1. The FY24 results reflect average foreign exchange rates of €1:£0.86, €1:INR 89.80, €1:ZAR 20.31, €1:TRY 29.08 and €1: EGP 34.83.
2. The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note 7
‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
3. Adjusted EBITDAaL and Adjusted basic earnings per share are non-GAAP measures. See page 235 for more information.
4. Includes depreciation on leased assets of €3,003 million (FY23: €2,682 million).
5. Reversal of interest on lease liabilities included within Adjusted EBITDAaL under the Group’s definition of that metric, for re-presentation in financing costs.
21
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Annual Report 2024
Strategic report
Governance
Financials
Other information
Our financial performance (continued)
Geographic performance summary
Following the announcements that we have entered into binding agreements in relation to the sale of Vodafone Spain and Vodafone Italy, we
have updated our financial reporting to recognise that Vodafone Spain and Vodafone Italy are now discontinued operations, in accordance with
International Financial Reporting Standards (‘IFRS’). Accordingly, Vodafone Spain and Vodafone Italy are excluded from the results of continuing
operations and are instead presented as a single amount as a loss after tax from discontinued operations in the Group’s consolidated income
statement. Discontinued operations are also excluded from the Group’s segment reporting. The FY23 comparatives in the tables below have been
re-presented to reflect that Vodafone Spain and Vodafone Italy are discontinued operations and should be used as the basis of comparison to our
FY24 results.
Total revenue
Service revenue
Adjusted EBITDAaL1
Adjusted EBITDAaL margin1
Capital additions
Segment results
FY24
€m
FY23
€m
FY24
€m
FY23
€m
FY24
€m
FY23
€m
FY24
%
FY23
%
FY24
€m
FY23
€m
Germany
12,957
13,113
11,453
11,433
5,017
5,323
38.7
40.6
2,515
2,558
UK
6,837
6,824
5,631
5,358
1,408
1,350
20.6
19.8
866
882
Other Europe
5,504
5,744
4,722
5,005
1,516
1,632
27.5
28.4
845
880
Turkey2,3
2,362
2,072
1,746
1,593
510
424
21.6
20.5
319
234
Africa3
7,420
8,076
5,951
6,556
2,539
2,880
34.2
35.7
1,005
1,123
Vantage Towers
-
1,338
-
-
-
795
-
551
Common Functions
1,864
1,750
559
530
29
20
781
839
Eliminations
(227)
(1,245)
(150)
(157)
-
-
-
-
Group4
36,717
37,672
29,912
30,318
11,019
12,424
30.0
33.0
6,331
7,067
FY23
FY24
Segment service
revenue growth
Q4
%
H2
%
Total
%
Q1
%
Q2
%
H1
%
Q3
%
Q4
%
H2
%
Total
%
Germany
(2.8)
(2.3)
(1.6)
(1.3)
1.0
(0.1)
0.3
0.6
0.5
0.2
UK
(1.6)
0.5
4.0
3.0
5.1
4.1
5.5
6.8
6.2
5.1
Other Europe
(5.2)
(1.8)
0.1
(7.4)
(7.2)
(7.3)
(7.8)
0.3
(4.0)
(5.7)
Turkey2,3
32.4
9.3
(4.6)
(8.5)
21.6
7.4
6.8
15.6
11.7
9.6
Africa3
(11.2)
(4.5)
2.7
(14.3)
(14.8)
(14.6)
(7.5)
1.2
(3.4)
(9.2)
Group4
(3.2)
(1.6)
0.4
(4.7)
(1.9)
(3.3)
(1.5)
2.9
0.7
(1.3)
FY23
FY24
Segment organic service
revenue growth1
Q4
%
H2
%
Total
%
Q1
%
Q2
%
H1
%
Q3
%
Q4
%
H2
%
Total
%
Germany
(2.8)
(2.3)
(1.6)
(1.3)
1.1
(0.1)
0.3
0.6
0.5
0.2
UK
3.8
4.6
5.6
5.7
5.5
5.6
5.2
3.6
4.4
5.0
Other Europe
3.6
2.8
2.8
4.1
3.8
3.9
3.6
5.5
4.6
4.2
Turkey2,3
54.9
51.7
43.5
74.1
85.0
79.3
90.4
105.6
97.8
88.5
Africa3
7.0
7.5
7.5
9.0
9.0
9.0
8.8
10.0
9.4
9.2
Group4
3.4
3.6
3.9
5.4
6.6
6.0
6.3
7.1
6.7
6.3
Notes:
1. Organic service revenue growth, Group Adjusted EBITDAaL and Group Adjusted EBITDAaL margin are non-GAAP measures. See page 235 for more information.
2. Comprises only Vodafone Turkey in FY24. The comparative period includes the results of Vodafone Ghana which, as previously reported, was sold in February 2023.
3. Service revenue growth and Organic service revenue growth metrics for FY23 have been re-presented to reflect the move of Vodafone Egypt to Vodacom from 1 April 2023 and the segment has
been re-named Africa.
4. Prior year Group metrics for Total revenue, Service revenue, Service revenue growth, Organic Service revenue growth, Adjusted EBITDAaL Adjusted EBITDAaL margin and Capital
additions have been re-presented to reflect that Vodafone Spain and Vodafone Italy are now reported as discontinued operations and are therefore excluded from these Group metrics.
22
Vodafone Group Plc
Annual Report 2024
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Financials
Other information
Growth
Total revenue decreased by 1.2% to €13.0 billion, driven by lower equipment revenue. Service revenue grew by 0.2% (Q3: 0.3%, Q4: 0.6%) as the
contribution from higher broadband ARPU was largely offset by the cumulative impact of broadband and TV customer losses and lower regulated
rates for terminating mobile calls. Growth improved in Q4, as higher consumer mobile ARPU and customer base growth was partially offset by a
0.9 percentage point impact from the end to bulk TV contracting in Multi Dwelling Units (‘MDUs’).
Fixed service revenue increased by 0.3% (Q3: 1.0%, Q4: -0.2%) as broadband ARPU growth was partially offset by the impact of a lower broadband
and TV customer base. The slowdown in fixed service revenue growth in Q4 was primarily driven by a 1.7 percentage point impact from changes
to German TV laws. Mobile service revenue was stable year-on-year (Q3: -0.5%, Q4: +1.8%) as ARPU growth and higher roaming and visitor
revenue were offset by a lower prepaid customer base and a reduction in mobile termination rates. Mobile service revenue growth in Q4 improved
having lapped the renewal and rephasing of a large multi-year IoT contract last year, which had adversely impacted prior quarters. Mobile service
revenue growth in Q4 was also supported by higher IoT project revenue, consumer contract ARPU growth, and a higher customer base. Vodafone
Business service revenue was stable year-on-year (Q3: -1.9%, Q4: +1.0%) as good demand for fixed services, including cloud and security, was
offset by a strong prior year performance in public sector and lower IoT revenue following the renewal of a major multi-year IoT automotive
contract in the prior year.
Adjusted EBITDAaL declined by 5.8%, reflecting a 2.7 percentage point impact from higher energy costs. The decline also reflected higher wage,
inflation-linked lease costs, and customer acquisition costs, as well as investments made to support the MDU transition. The Adjusted EBITDAaL
margin was 1.9 percentage points lower year-on-year at 38.7%.
Customers
During the year, we re-engineered our commercial model and launched a number of new products and services to better serve our customers. In
broadband, we restored our market leading network quality position. This was reflected in four major independent network test results from
Connect, CHIP, Computer BILD and nPerf where we achieved leading quality and reliability scores. Reflecting inflationary pressure, we have
increased the price of our broadband packages. As expected, this impacted our commercial performance with our broadband customer base
declining by 392,000 during the year. Our converged customer base increased by 99,000 to 2.4 million.
Ahead of changes to German TV laws, which take effect from July 2024 and change the practice of bulk TV contracting in MDUs, we have started
migrating end users to new contracts at scale. Based on our experience to date, we expect to retain around 50% of the 8.5 million MDU TV
households. At the end of March 2024, we had already actively retained 1.9 million households. Our total TV customer base declined by 1.0
million during the year, primarily due to the MDU transition, which began in the last quarter of FY24.
We added 239,000 new mobile contract customers in FY24, supported by our new propositions, the ongoing optimisation of sales channels and
an improved performance of Vodafone’s own brands. We also added 8.0 million IoT connections, driven by continued strong demand from the
automotive sector. During the year, we agreed a long-term national roaming partnership with 1&1. We expect to deliver mobile coverage
nationwide to 1&1’s customers from the second half of the 2024 calendar year. Our fibre-to-the-home (‘FTTH’) joint venture, OXG Glasfaser,
started its network rollout during the year, initially in Neuss, Düsseldorf, Marburg and Kassel. OXG Glasfaser will deploy FTTH to up to seven million
homes over a six-year period and is complementary to our upgrade plans for our existing hybrid fibre cable network.
FY24
€m
FY23
€m
Reported
change
%
Organic
change1
%
Total revenue
12,957
13,113
(1.2)
Service revenue
11,453
11,433
0.2
0.2
Other revenue
1,504
1,680
Adjusted EBITDAaL
5,017
5,323
(5.8)
(5.8)
Adjusted EBITDAaL margin
38.7%
40.6%
Note:
1. Organic growth is a non-GAAP measure. See page 235 for more information.
Germany: Underlying improvement offset by first MDU impact
23
Vodafone Group Plc
Annual Report 2024
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Financials
Other information
Our financial performance (continued)
UK: Strong growth in Consumer and Business
FY24
€m
FY23
€m
Reported
change
%
Organic
change1
%
Total revenue
6,837
6,824
0.2
Service revenue
5,631
5,358
5.1
5.0
Other revenue
1,206
1,466
Adjusted EBITDAaL
1,408
1,350
4.3
4.0
Adjusted EBITDAaL margin
20.6%
19.8%
Note:
1. Organic growth is a non-GAAP measure. See page 235 for more information.
Growth
Total revenue increased by 0.2% to €6.8 billion as service revenue growth
was offset by a decline in equipment revenue. Service revenue increased by
5.1% (Q3: 5.5%, Q4: 6.8%). Organic growth in service revenue increased by
5.0% (Q3: 5.2%, Q4: 3.6%), driven by continued strong growth in the
Consumer and Business segments. The lower service revenue growth in Q4
was driven by Business following strong project revenue in prior periods.
Mobile service revenue grew by 5.4% (Q3: 5.8%, Q4: 6.8%). Organic
growth in mobile service revenue was 5.4% (Q3: 5.4%, Q4: 3.7%), driven
by good commercial momentum, annual price increases, and higher
roaming revenue, partially offset by the migration of the Virgin Media
MVNO off our network. The lower growth in Q4 was driven by a strong
Business performance in prior periods. Fixed service revenue grew by
4.1% (Q3: 4.6%, Q4: 7.0%). Organic growth in fixed service revenue was
3.9% (Q3: 4.6%, Q4: 3.5%) driven by good Consumer customer base growth.
Vodafone Business service revenue increased by 3.3% (Q3: 6.3%, Q4:
2.6%). Organic growth in Vodafone Business service revenue was 3.2%
(Q3: 5.8%, Q4: -0.5%), due to strong growth in mobile supported by
annual price increases. Growth was also supported by our IoT business
and during the year, we announced we will be providing IoT connectivity to
Britain’s smart metering network through our partnership with Data
Communications Company (‘DCC’). Fixed sales momentum continued
to improve throughout the year. We also announced a new channel
called Business IT Hubs, which is planning to establish 300 franchise
partners to help SMEs better manage their IT solutions.
Adjusted EBITDAaL increased by 4.3% in the year. On an organic basis,
Adjusted EBITDAaL increased by 4.0%, with strong service revenue
growth, partially offset by a 1.8 percentage point impact from higher
energy costs, and the migration of the Virgin Media MVNO off our
network. The adjusted EBITDAaL margin improved by 0.8 percentage
points year-on-year on a reported and organic basis to 20.6%.
Customers
During the year our mobile contract customer base continued to grow,
however this was offset by low value disconnections in Business. In the
second half of the year, we were recognised as a Consumer NPS
co-leader in the market and we are now the joint lowest complained
about mobile operator, as measured by Ofcom, reflecting the significant
improvements and investment we have made to our customer experience
over the last few years. Our digital prepaid sub-brand ‘VOXI’ continued
to grow, with 120,000 customers added during the year. Through our
partnerships with CityFibre and Openreach we can now reach 15.3 million
households with full fibre broadband, more than any other provider in
the UK. We are one of the fastest growing broadband providers in the
UK and our broadband customer base increased by 160,000.
Portfolio
In June 2023, we announced a binding agreement to combine our UK
business with Three UK to create a sustainable, and competitive third scaled
network operator in the UK. Following the merger, which we expect to close
around the end of the 2024 calendar year, Vodafone and CK Hutchison will
own 51% and 49% of the combined business, respectively. This
combination is expected to provide customers with greater choice
and more value, drive greater competition, and enable increased
investment with a clear £11 billion plan to create one of Europe’s most
advanced standalone 5G networks.
Other Europe1: Service revenue growth in all markets
FY24
€m
FY231
€m
Reported
change
%
Organic
change2
%
Total revenue
5,504
5,744
(4.2)
Service revenue
4,722
5,005
(5.7)
4.2
Other revenue
782
739
Adjusted EBITDAaL
1,516
1,632
(7.1)
1.5
Adjusted EBITDAaL
margin
27.5%
28.4%
Notes:
1. Other Europe markets comprise Portugal, Ireland, Greece, Romania, Czech Republic and
Albania. The comparative metrics include the results of Vodafone Hungary which, as
previously reported, was sold in January 2023.
2. Organic growth is a non-GAAP measure. See page 235 for more information.
Growth
Total revenue declined by 4.2% to €5.5 billion, reflecting the disposal
of Vodafone Hungary in the prior year. Service revenue decreased by
5.7% (Q3: -7.8%, Q4: +0.3%). Organic growth in service revenue
increased by 4.2% (Q3: 3.6%, Q4: 5.5%), with all six markets growing
during the year, supported by good commercial momentum and our
price actions in most markets. The acceleration in quarterly trends
was driven by public sector project work.
In Portugal, both our Consumer and Business segments continued to
perform well, also supported by inflation-linked contractual price
increases implemented in March 2023. In Ireland, service revenue
increased, driven by a higher average customer base, and supported
by our annual contractual price increases. Service revenue in Greece
grew, reflecting strong demand for Business fixed services.
Vodafone Business service revenue increased by 0.4% (Q3: -1.3%, Q4:
8.1%). Organic growth in Vodafone Business service revenue was 7.9%
(Q3: 7.8%, Q4: 12.2%) during the year, with growth in both
connectivity and digital services, including IoT and Cloud. Growth in
connectivity was supported by a higher customer base, price
increases in the Soho and SME customer segments across our
markets and growth in digital services, with public sector contract
wins in Romania.
Adjusted EBITDAaL decreased by 7.1% in the year. On an organic
basis, Adjusted EBITDAaL grew by 1.5%, as service revenue growth
and ongoing cost efficiencies were offset by the 0.6 percentage point
impact from higher energy costs, as well as one-off bad debt impacts
in relation to certain customer contracts in Greece. The Adjusted
EBITDAaL margin decreased by 0.9 percentage points year-on-year
(organic: -1.4 percentage points) at 27.5%.
Customers
During FY24, we maintained our good commercial momentum. In
Portugal, we added 167,000 mobile contract customers and 58,000
fixed broadband customers. In Ireland, our mobile contract customers
base increased by 30,000. Through our fixed wholesale network
access partnerships, we now cover over 1.4 million households in
Ireland with FTTH. In Greece, we added 146,000 mobile contract
customers, and our broadband customer base declined by 12,000.
Portfolio
In September 2022, we announced that we had entered into an
agreement to buy Portugal’s fourth largest converged operator, Nowo
Communications, from Llorca JVCO Limited, the owner of Masmovil
Ibercom S.A. The transaction is conditional on regulatory approval. We
submitted proposed remedies which were rejected in early 2024.
After reviewing the competition authority’s comments and exploring
further options to address the authority’s concerns, we submitted
revised proposals that are currently being considered by the
competition authority.
24
Vodafone Group Plc
Annual Report 2024
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Financials
Other information
Africa: Resilient performance
FY24
€m
Re-presented1
FY23
€m
Reported
change
%
Organic
change2
%
Total revenue
7,420
8,076
(8.1)
Service revenue
5,951
6,556
(9.2)
9.2
Other revenue
1,469
1,520
Adjusted EBITDAaL
2,539
2,880
(11.8)
6.4
Adjusted EBITDAaL
margin
34.2%
35.7%
Notes:
1. The comparative metrics for FY23 have been re-presented to reflect the move of Vodafone
Egypt to Vodacom from 1 April 2023 and the segment has been re-named Africa.
2. Organic growth is a non-GAAP measure. See page 235 for more information.
Growth
Total revenue declined by 8.1% to €7.4 billion due to the depreciation
of local currencies versus the euro. Service revenue decreased by
9.2% (Q3: -7.5%, Q4: +1.2%). Organic growth in service revenue grew
by 9.2% (Q3: 8.8%, Q4: 10.0%) with growth in South Africa, Egypt and
Vodacom’s international markets.
In South Africa, service revenue growth was supported by the
Consumer mobile contract segment, which benefited from a price
increase in the first quarter, and good fixed line growth in Consumer
and Business. Growth slowed in Q4 due to a strong prior year
comparative, reflecting an acceleration in customer data usage during
widespread power outages, and pressure on wholesale revenue.
Financial services revenue grew by 7.9% to €156.9 million on an
organic basis, supported by growth in our insurance services.
Service revenue in Egypt grew strongly during the year and
accelerated in Q4, above inflation. The acceleration was supported by
sustained customer base growth, price increases in mobile and fixed,
robust demand for data and strong growth in our financial services
product, ‘Vodafone Cash’. Vodafone Cash revenue more than doubled
in FY24 to €95.8 million.
In Vodacom’s international markets, service revenue growth was
supported by a higher customer base and strong M-Pesa and data
revenue growth. M-Pesa revenue grew by 13.4% on an organic basis
and now represents 26.8% of service revenue.
Adjusted EBITDAaL declined by 11.8% during the year. On an organic
basis, adjusted EBITDAaL increased by 6.4%, supported by service
revenue growth and cost initiatives, partially offset by an increase in
technology operating expenses associated with higher energy costs.
The Adjusted EBITDAaL margin decreased by 1.5 percentage points
year-on-year (organic: -1.1 percentage points) to 34.2%.
Customers
In South Africa, we added 125,000 contract customers in the year,
and now have a mobile contract base of 6.8 million. We added 5.7
million mobile prepaid SIMs in the year, supported by our big data led
customer value management capabilities which offer personalised
bundles to customers. Across our active customer base, 81.5% of our
mobile customers now use data services, an increase of 3.3 million
year-on-year. Our ‘VodaPay’ super-app continued to gain traction with
5.8 million registered users.
In Egypt, we added 437,000 contract customers and 2.4 million
prepaid mobile customers during the year, and we now have 48.3
million customers. ‘Vodafone Cash’ now has 8.2 million active users
with 2.8 million users added during the year.
In Vodacom’s international markets, we added 4.0 million mobile
customers and our mobile customer base is now 54.2 million, with
63.5% of active customers using our data services.
Turkey: Outperforming in an inflationary environment
Turkey
FY24
€m
Turkey and
Ghana1
FY23
€m
Reported
change
%
Organic
change2
%
Total revenue
2,362
2,072
14.0
Service revenue
1,746
1,593
9.6
88.5
Other revenue
616
479
Adjusted EBITDAaL
510
424
20.3
99.9
Adjusted EBITDAaL
margin
21.6%
20.5%
Notes:
1. The comparative period includes the results of Vodafone Ghana which was sold in February
2023 (previously reported within Other Markets, which also included Turkey).
2. Organic growth is a non-GAAP measure. See page 235 for more information. .
Growth
Total revenue increased by 14.0% to €2.4 billion, with strong service
revenue growth partly offset by a significant devaluation of the local
currency and the disposal of Vodafone Ghana in the prior financial
year.
Despite material currency devaluation, service revenue increased in
euro terms by 9.6% (Q3: 6.8%, Q4: 15.6%). Organic growth in service
revenue in Turkey was 88.5% (Q3: 90.4%, Q4: 105.6%), driven by
ongoing repricing actions to reflect the high inflationary environment
and value accretive base management activities.
Vodafone Business service revenue increased by 20.1% (Q3: 20.5%,
Q4: 20.3%). Organic growth in Vodafone Business service revenue was
87.4% (Q3: 94.7%, Q4: 102.2%) during the year, driven by higher
connectivity revenue and strong Business demand for our cloud and
IoT services. In February 2024, we announced our partnership with
DAMAC to build a new data centre in Izmir.
Adjusted EBITDAaL increased by 20.3% in the year, growing in euro
terms during FY24. On an organic basis, adjusted EBITDAaL in Turkey
increased by 99.9%, supported by ongoing digitalisation and our
continued focus on cost efficiency, in the context of significant
inflationary pressure on our cost base. The Adjusted EBITDAaL margin
increased by 1.1 percentage points year-on-year (organic: 1.0
percentage points) at 21.6%.
Customers
We maintained our good commercial momentum, adding 1.4 million
mobile contract customers during the year, including migrations of
prepaid customers. We also increased investments to improve our
networks after the earthquake in the prior year.
Hyperinflationary accounting in Turkey
Turkey was designated as a hyperinflationary economy on 1 April
2022 in line with IAS 29 ‘Financial Reporting in Hyperinflationary
Economies’. See note 1 ‘Basis of preparation’ in the consolidated
financial statements for further information.
Organic growth metrics exclude the impact of the hyperinflation
adjustment and foreign exchange translation in Turkey. On an organic
basis, Group service revenue growth excluding Turkey was 3.7% (Q3:
3.6%, Q4: 4.0%) and adjusted EBITDAaL excluding Turkey declined by
0.6%.
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25
Vodafone Group Plc
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Other information
Italy
FY24
€m
FY23
€m
Reported
change
%
Organic
change1
%
Total revenue
4,668
4,809
(2.9)
Service revenue
4,184
4,251
(1.6)
(1.6)
Other revenue
484
558
Note:
1. Organic growth is a non-GAAP measure. See page 235 for more information.
On 15 March 2024, we announced that we had entered into a binding
agreement to sell Vodafone Italy to Swisscom AG for €8 billion
upfront cash proceeds (subject to customary closing adjustments).
Completion is expected to take place during the first half of the 2025
calendar year. The Group recorded a non-cash charge of €83 million,
included in discontinued operations as a result of the re-
measurement of Vodafone Italy to fair value less costs to sell. See
note 7 to the consolidated financial statements for further
information.
Total revenue declined 2.9% to €4.7 billion due to lower service
revenue and equipment revenue. Service revenue declined by 1.6%
(Q3: -1.3%, Q4: -2.5%), as continued price pressure in the mobile value
segment was only partly offset by strong Business demand for our
fixed line connectivity and digital services. Vodafone Business service
revenue increased by 7.6% (Q3: 7.5%, Q4: 6.1%) during the year,
driven by strong fixed connectivity and digital services growth.
Spain
FY24
€m
FY23
€m
Reported
change
%
Organic
change1
%
Total revenue
3,846
3,907
(1.6)
Service revenue
3,429
3,514
(2.4)
(2.4)
Other revenue
417
393
Note
1. Organic growth is a non-GAAP measure. See page 235 for more information.
On 31 October 2023, we announced that we had entered into binding
agreements with Zegona Communications plc in relation to the sale
of 100% of Vodafone Spain. We expect final approval from the
Spanish authorities to be granted imminently, with completion to
occur shortly thereafter. On completion, we will receive €4.1 billion in
cash (subject to customary closing adjustments) and €0.9 billion in
the form of Redeemable Preference Shares, which redeem no later
than six years after closing. Vodafone and Zegona have entered into
an agreement whereby Vodafone will provide certain services to
Vodafone Spain after completion of the transaction and Vodafone will
continue to have a presence in Spain through its Innovation Hub in
Malaga. The Group recorded a non-cash charge of €345 million,
included in discontinued operations as a result of the re-
measurement of Vodafone Spain to fair value less costs to sell. See
note 7 to the consolidated financial statements for further
information.
Total revenue declined by 1.6% to €3.8 billion due to lower service
revenue. Service revenue declined by 2.4% (Q3: -1.1%, Q4: -2.9%) due
to continued price competition in the Consumer value segment, a
lower customer base and a reduction in mobile termination rates.
Vodafone Business service revenue declined by 1.2% (Q3: +2.2%, Q4:
-2.7%) as lower mobile connectivity revenue, due to price competition
in the SoHo customer segment, was only partially offset by good
demand for Business digital services, particularly in Q3.
Our financial performance (continued)
Vodafone Investments
FY24
€m
FY23
€m
Vantage Towers (Oak Holdings 1 GmbH)
(85)
-
VodafoneZiggo Group Holding B.V.
(177)
137
Safaricom Limited
159
195
Indus Towers Limited
140
50
Other1 (including TPG Telecom Limited)
(133)
51
Share of results of equity accounted
associates and joint ventures
(96)
433
Note:
1. The Group’s investment in Vodafone Idea Limited (‘VIL’) was reduced to €nil in the year ended
31 March 2020 and the Group has not recorded any profit or loss in respect of its share of
VIL’s results since that date.
Vantage Towers – 53.9% ownership
On 23 March 2023, we announced the completion of Oak Holdings
GmbH, our co-control partnership for Vantage Towers with a
consortium of long-term infrastructure investors led by Global
Infrastructure Partners and KKR. We received initial net proceeds of
€4.9 billion in March 2023, and a further €500 million in July 2023,
taking total net proceeds to €5.4 billion and the Consortium’s
ownership in Oak Holdings GmbH to 40%. During the year, total
revenue increased 6.3% to €1.1 billion, driven by 2,400 net new
tenancies and 1,100 new macro sites. As a result, the tenancy ratio
increased to 1.50x. Vodafone’s share of results in FY24 reflects the
amortisation of intangible assets arising from the completion of the
co-control partnership for Vantage Towers. During the year, Vodafone
received €196 million in dividends from Vantage Towers.
VodafoneZiggo Joint Venture (Netherlands) – 50.0% ownership
The results of VodafoneZiggo are prepared under US GAAP, which is
broadly consistent with Vodafone’s IFRS basis of reporting. Total
revenue increased 1.5% to €4.1 billion, as contractual price increases
and mobile contract customer growth were partially offset by a
decline in the fixed customer base. During the year, VodafoneZiggo
added 129,000 mobile contract customers. VodafoneZiggo’s
broadband customer base declined by 115,000 customers to 3.2
million due to the competitive price environment. The number of
converged households increased by 20,000 and 48% of broadband
customers are now converged, delivering significant NPS and
customer loyalty benefits. VodafoneZiggo now offers gigabit speeds
to 7.5 million homes, providing nationwide coverage. Vodafone’s
lower share of results in FY24 was largely due to lower adjusted
EBITDA, lower gains on derivative financial instruments and higher
third-party interest expenses. During the year, Vodafone received
€100 million in equity distributions and €51 million in interest
payments from the joint venture.
Discontinued Operations
26
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Safaricom Associate (Kenya) – 27.8% ownership
Safaricom service revenue declined to €2.1 billion, as the devaluation
of the local currency was only partially offset by a higher customer
base and strong mobile data and M-Pesa growth. Vodafone’s lower
share of results was due to the depreciation of the Kenyan shilling
versus the euro. During the year, Vodafone received €122 million in
dividends from Safaricom.
Indus Towers Limited Associate (India) – 21.0% ownership
Following the sale of shares in Indus Towers Limited (‘Indus Towers’)
in February and March 2022, the Group holds 567.2 million shares in
Indus Towers. Vodafone’s higher share of results in FY24 was largely
due to higher adjusted EBITDAaL.
Vodafone Idea Limited Joint Venture (India) – 31.4% ownership
See note 29 ‘Contingent liabilities and legal proceedings’ in the
consolidated financial statements for more information.
Vodafone Idea Limited has undertaken equity fund-raisings totalling
€2.2 billion since 31 March 2024, reducing the Group’s shareholding
to 23.2%.
TPG Telecom Limited Joint Venture (Australia) – 25.1%
ownership
TPG Telecom Limited is a fully integrated telecommunications
operator in Australia. Hutchison Telecommunications (Australia)
Limited owns an equivalent economic interest of 25.1%, with the
remaining 49.9% listed as free float on the Australian stock exchange.
We also hold a 50% share of loan facilities of AU$2.5 billion, US$1.0
billion and €0.6 billion (2023: US$3.5 billion) held within the structure
that holds the Group’s equity stake in TPG Telecom. During the year,
Vodafone received €23 million in dividends from TPG Telecom.
Net financing costs
FY24
€m
Re-presented1
FY23
€m
Reported
change %
Investment income
581
232
Financing costs
(2,626)
(1,609)
Net financing costs
(2,045)
(1,377)
(48.5)
Adjustments for:
Mark-to-market losses
97
(534)
Foreign exchange losses
173
135
Adjusted net financing costs2
(1,775)
(1,776)
0.1
Notes:
1. The results for the year ended 31 March 2023 have been re-presented to reflect that the
results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations.
See note 7 ‘Discontinued operations and assets held for sale’ in the consolidated financial
statements for more information.
2. Adjusted net financing costs is a non-GAAP measure. See page 235 for more information.
Net financing costs increased by €668 million, primarily due to
year-on-year changes of mark-to-market gains recycled from reserves
on derivatives that were previously in cash flow hedge relationships
and mark-to-market movements on the revaluation of the embedded
derivative option linked to the Group’s bank borrowings secured
against Indian assets.
Adjusted net financing costs are in line with prior year, reflecting both
a decrease in average net debt balances and higher returns on cash
and short-term investments, offset by interest movements on lease
liabilities and other items outside of net debt.
Taxation
FY24
%
Re-presented1
FY23
%
Change
pps
Effective tax rate
3.1%
3.8%
(0.7)
Adjusted effective tax rate2
24.5%
25.6%
(1.1)
Notes:
1. The results for the year ended 31 March 2023 have been re-presented to reflect that the
results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations.
See note 7 ’Discontinued operations and assets held for sale’ in the consolidated financial
statements for more information.
2. Adjusted effective tax rate is a non-GAAP measure. See page 235 for more information.
The Group’s effective tax rate (‘ETR’) for the year ended 31 March
2024 was 3.1%, (FY23: 3.8%). The rate remains low following the
recognition of a €1,019 million deferred tax asset on losses in
Luxembourg as a result of favourable case law during the year. The
ETR also reflects a tax credit of €249 million (2023: €309 million)
relating to the impacts of inflation in Turkey.
The year ended 31 March 2023 included gains on the disposals of
Vantage Towers and Vodafone Ghana which were largely exempt
from tax, except for a €88 million charge relating to the disposal of
Vantage Towers, as well as the hyperinflation accounting impacts in
Turkey and utilisation of losses in Luxembourg.
The Group’s Adjusted ETR (‘AETR’) for the year ended 31 March 2024
was 24.5% (FY23: 25.6%). The AETR excludes the recognition of a
deferred tax asset in Luxembourg, the impact of a €598 million tax
charge (2023: €33 million) relating to the use of losses in
Luxembourg and the effects of inflation in Turkey.
The charge on losses in Luxembourg is higher than the prior year
because of an internal restructuring in 2023 which resulted in a loss.
As a result of that restructuring, profits in Luxembourg are no longer
subject to changes in the value of investments. The effects of
hyperinflation accounting in Turkey, and the tax charge relating to the
disposal of Vantage Towers in 2023, are set out above.
The main drivers for the reduction in the AETR are the mix of profits
between jurisdictions in 2024 compared to 2023 and Vodafone Spain
moving to discontinued operations accounting in 2024 as previously
the non-recognition of tax losses in Spain increased AETR.
27
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Earnings per share
FY24
eurocents
Re-presented1
FY23
eurocents
Reported
change
eurocents
Basic earnings per share -
Continuing operations
4.45c
43.66c
(39.21)c
Basic earnings per share - Total
Group
4.21c
42.77c
(38.56)c
Adjusted basic earnings
per share2
7.47c
11.28c
(3.81)c
Notes:
1. The results for the year ended 31 March 2023 have been re-presented to reflect that the
results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations.
See note 7 ‘Discontinued operations and assets held for sale’ in the consolidated financial
statements for more information.
2. Adjusted basic earnings per share is a non-GAAP measure. See page 235 for more
information.
Basic earnings per share from continuing operations was 4.45
eurocents, compared to 43.66 eurocents for FY23. The decrease was
primarily due to gains on disposal in the prior year of Vantage Towers
A.G. and Vodafone Ghana, partially offset by the loss on the disposal
of Vodafone Hungary.
Adjusted basic earnings per share was 7.47 eurocents, compared to
11.28 eurocents for FY23. The decrease was primarily due to lower
Adjusted EBITDAaL.
Consolidated statement of financial position
The consolidated statement of financial position is set out on page
136. Details on the major movements of both our assets and liabilities
in the year are set out below.
In accordance with IFRS requirements, Vodafone Spain and Vodafone
Italy are reported as discontinued operations in the consolidated
financial statements. The assets and liabilities of these discontinued
operations of €19.0 billion and €6.9 billion, respectively, are classified
as held for sale and are presented separately as current items in the
consolidated statement of financial position as at 31 March 2024. This
results in significant year-on-year movements in reported assets and
liabilities in the consolidated statement of financial position.
See note 7 ‘Discontinued operations and assets held for sale’ in the
consolidated financial statements for more information.
Our financial performance (continued)
Assets
Non-current assets
Intangible assets decreased by €8.4 billion between 31 March 2023
and 31 March 2024 to €38.9 billion. This primarily reflects a reduction
of €6.7 billion from the classification of Vodafone Spain and Vodafone
Italy as discontinued operations and amortisation exceeding additions
in the year by €1.2 billion.
Property, plant and equipment decreased by €9.5 billion between 31
March 2023 and 31 March 2024 to €28.5 billion. This reflects a
decrease of €6.5 billion in owned assets and a decrease of €3.0 billion
in right-of-use assets. These decreases are primarily attributable to
the classification of Vodafone Spain and Vodafone Italy as
discontinued operations.
Investments in associates and joint ventures decreased by €1.0 billion
between 31 March 2023 and 31 March 2024, primarily attributable to
a stake sale of 3.9% in Oak Holdings 1 GmbH (Vantage Towers) and
dividends received in the year exceeding our share of results.
Deferred tax assets increased by €0.9 billion between 31 March 2023
and 31 March 2024 to €20.2 billion. See note 6 ‘Taxation’ in the
consolidated financial statements for more information.
Trade and other receivables decreased by €1.9 billion between 31
March 2023 and 31 March 2024 to €6.0 billion, primarily attributable
to a decrease in the carrying value of derivative financial instruments.
Current assets
Current assets decreased by €10.1 billion between 31 March 2023
and 31 March 2024 to €20.5 billion. This was primarily due to a
decrease in cash and cash equivalents of €5.5 billion, a decrease of
€2.1 billion in Trade and other receivables, which principally reflects
the classification of Vodafone Spain and Vodafone Italy as
discontinued operations, and a decrease of €1.9 billion in Other
investments.
Total equity and liabilities
Total equity decreased by €3.5 billion between 31 March 2023 and
31 March 2024 to €61.0 billion, primarily due to comprehensive
expense in the period of €0.7 billion and €2.7 billion of dividends paid
to the Group’s shareholders.
Non-current liabilities
Non-current liabilities decreased by €3.3 billion between 31 March
2023 and 31 March 2024 to €53.2 billion, primarily due to a decrease
in Borrowings arising from the classification of Vodafone Spain and
Vodafone Italy as discontinued operations (€2.4 billion).
Current liabilities
Current liabilities decreased by €11.3 billion between 31 March 2023
and 31 March 2024 to €23.3 billion, primarily due to a €6.1 billion
decrease in Borrowings and a €4.8 billion decrease in Trade and
other payables, of which €2.7 billion reflects the classification of
Vodafone Spain and Vodafone Italy as discontinued operations
and €1.2 billion reflects the sale of M-Pesa Holding Company
Limited to Safaricom plc.
Inflation
The Group continues to apply hyperinflationary accounting, as
specified in IAS 29, at its Turkish operations where the functional
currency is the Turkish lira and to Safaricom’s operations in Ethiopia
where the Ethiopian birr is the functional currency. See note 1 ‘Basis
of preparation’ in the consolidated financial statements for more
information and for a summary of the impact on the financial results
of the Group for the year ended 31 March 2024.
28
Vodafone Group Plc
Annual Report 2024
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Governance
Financials
Other information
Cash flow, capital allocation and funding
Analysis of cash flow
FY24
€m
FY23
€m
Reported
change %
Inflow from operating activities
16,557
18,054
(8.3)
Outflow from investing activities
(6,122)
(379)
(1,515.3)
Outflow from financing activities
(15,855)
(13,430)
(18.1)
Net cash outflow
(5,420)
4,245
(227.7)
Cash and cash equivalents at
beginning of the financial year
11,628
7,371
Exchange gain on cash and cash
equivalents
(94)
12
Cash and cash equivalents at
the end of the financial year
6,114
11,628
Cash inflow from operating activities decreased to €16,557 million
reflecting lower operating profit, excluding a lower share of results in
equity accounted associates and joint ventures and a net gain in the
prior year resulting from the sale of Vantage Towers, Vodafone Ghana
and Vodafone Hungary, and adverse working capital movements,
which offset lower taxation payments.
Outflows from investing activities increased to €6,122 million,
primarily in relation to the decrease in proceeds received in the prior
year from disposal of interests in subsidiaries and a lower net inflow in
respect of short-term investments, which outweighed proceeds from
the sale of 3.9% of Oak Holdings 1 GmbH and the decrease in the
purchase of intangible assets and property, plant and equipment in
the year. Short-term investments include highly liquid government
and government-backed securities and managed investment funds
that are in highly rated and liquid money market investments with
liquidity of up to 90 days.
Outflows from financing activities increased to €15,855 million as
higher net cash outflows in respect of borrowings, primarily arising
from movements in collateral balances, outweighed lower outflows in
relation to the purchase of treasury shares and in respect of
discontinued operations.
FY24
€m
Re-presented1
FY23
€m
Reported
change %
Adjusted EBITDAaL2
11,019
12,424
(11.3)
Capital additions3
(6,331)
(7,067)
Working capital
(309)
377
Disposal of property, plant and
equipment and intangible assets
14
90
Integration capital additions
(81)
(200)
Restructuring costs including
working capital movements4
(254)
(249)
Licences and spectrum
(454)
(773)
Interest received and paid5
(1,279)
(1,172)
Taxation
(724)
(1,228)
Dividends received from associates
and joint ventures
442
617
Dividends paid to non-controlling
shareholders in subsidiaries
(260)
(400)
Other
-
164
Free cash flow2
1,783
2,583
(31.0)
Acquisitions and disposals
(346)
8,727
Equity dividends paid
(2,430)
(2,484)
Share buybacks5
-
(1,893)
Foreign exchange gain/(loss)
(64)
141
Other movements in net debt6
1,065
(613)
Net debt decrease2
8
6,461
Opening net debt2
(33,250)
(39,711)
Closing net debt2
(33,242) (33,250)
-
Net debt of Vodafone Spain and
Vodafone Italy2
(107)
(125)
Closing net debt incl. Vodafone
Spain and Vodafone Italy2
(33,349) (33,375)
0.1
Free cash flow2
1,783
2,583
Adjustments:
– Licences and spectrum
454
773
– Restructuring costs including
working capital movements4
254
249
– Integration capital additions
81
200
– Vantage Towers growth
capital expenditure
-
497
– Other adjustments7
28
(163)
Adjusted free cash flow2
2,600
4,139
Notes:
1. The results for the year ended 31 March 2023 have been re-presented to reflect that the
results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations.
See note 7 ‘Discontinued operations and assets held for sale’ in the consolidated financial
statements for more information.
2. Adjusted EBITDAaL, Free cash flow, Adjusted free cash flow and Net debt are non-GAAP
measures. See page 235 for more information.
3. See page 248 for an analysis of tangible and intangible additions in the year.
4. Includes working capital in respect of integration capital additions.
5. Interest received and paid excludes €406 million outflow (FY23: €296 million) in relation to
the cash portion of interest on lease liabilities included within Adjusted EBITDAaL, and €nil of
cash flow (FY23: €26 million outflow) from the option structures relating to the issue of the
mandatory convertible bonds which is included within Share buybacks. The share buyback
programmes completed on 15 March 2023.
6. Other movements in net debt for FY24 includes a net inflow from discontinued operations of
€455 million (FY23: €1,175 million outflow), mark-to-market losses recognised in the income
statement of €97 million (FY23: €534 million gain) and of €185 million (FY23: €371 million)
for the repayment of debt in relation to licences and spectrum.
7. The amount for FY23 includes €120 million received in respect of the Group’s fibre joint
venture in Germany and an allocation of €43 million from the Vodafone Hungary proceeds
for future services to be provided by the Group.
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Funding position
FY24
€m
FY23
€m
Reported
change %
Bonds
(40,743)
(44,116)
Bank loans
(767)
(795)
Other borrowings including
spectrum
(1,457)
(1,744)
Gross debt1
(42,967)
(46,655)
7.9
Cash and cash equivalents
6,183
11,705
Short-term investments2
3,225
4,305
Derivative financial instruments3
2,204
1,917
Net collateral liabilities4
(1,887)
(4,647)
Net debt1
(33,242)
(33,375)
0.4
Notes:
1. Gross debt and Net debt are non-GAAP measures. See page 235 for more information.
2. Short-term investments includes €1,201 million (FY23: €1,338 million) of highly liquid
government and government-backed securities and managed investment funds of €2,024
million (FY23: €2,967 million) that are in highly rated and liquid money market investments
with liquidity of up to 90 days.
3. Derivative financial instruments excludes derivative movements in cash flow hedging reserves
of €498 million gain (FY23: €2,785 million gain).
4. Collateral arrangements on derivative financial instruments result in cash being
held as security. This is repayable when derivatives are settled and is therefore deducted
from liquidity.
Net debt decreased by €133 million to €33,242 million. This was
driven by the free cash inflow of €1,783 million together with other
movements of €1,065 million, offset by acquisitions and disposals of
€346 million and equity dividends of €2,430 million.
Other funding considerations include:
FY24
€m
FY23
€m
Lease liabilities
(9,672)
(13,364)
Financial liabilities under put options
(KDG minority interests)
-
(485)
Net pension fund liabilities
(196)
(258)
Guarantees over loan issued by
Australia joint venture
(1,479)
(1,611)
Equity characteristic of 50% attributed by
credit rating agencies to ‘Hybrid bonds’
included in net debt of €8,993 million
(€9,942 million as at 31 March 2023)
4,497
4,971
The Group’s gross and net debt includes certain bonds which have
been designated in hedge relationships, which are carried at €1,229
million higher value (€1,282 million higher as at 31 March 2023) than
their euro equivalent redemption value. In addition, where bonds are
issued in currencies other than the euro, the Group has entered into
foreign currency swaps to fix the euro cash outflows on redemption.
The impact of these swaps is not reflected in gross debt and if it were
included, the euro equivalent value of the bonds would decrease by
€1,559 million (€1,440 million as at 31 March 2023).
Adjusted free cash flow decreased by €1,539 million to €2,600 million
in the period. This reflects a decrease in Adjusted EBITDAaL in the
period, adverse working capital movements and lower dividends from
associates and joint ventures, which outweighed lower capital
additions, lower taxation, and lower dividends paid to non-controlling
shareholders in subsidiaries.
Acquisitions and disposals includes €500 million in relation to the
disposal of 3.9% of Oak Holdings 1 GmbH in the year, offset by a final
payment of €494 million to settle the Group’s obligations to the
minority shareholders in Kabel Deutschland Holding A.G.
Borrowings and cash position
FY24
€m
FY23
€m
Reported
change %
Non-current borrowings
(48,328)
(51,669)
Current borrowings
(8,659)
(14,721)
Borrowings
(56,987)
(66,390)
Cash and cash equivalents
6,183
11,705
Borrowings less cash and
cash equivalents
(50,804)
(54,685)
7.1
Borrowings principally includes bonds of €40,743 million (€44,116
million as at 31 March 2023), lease liabilities of €9,672 million
(€13,364 million as at 31 March 2023), cash collateral liabilities of
€2,628 million (€4,886 million as at 31 March 2023) and €1,720
million (€1,485 million as at 31 March 2023) of bank borrowings that
are secured against the Group’s shareholdings in Indus Towers and
Vodafone Idea.
The decrease in borrowings of €9,403 million was principally driven
by repayment of bonds of €4,847 million, a decrease in collateral
liabilities of €2,258 million and the transfer of borrowings in Italy and
Spain to discontinued operations (€3,553 million), offset by the
issuance of new bonds of €1,314 million.
Our financial performance (continued)
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Other information
Return on capital employed
Return on capital employed (‘ROCE’) reflects how efficiently we are
generating profit with the capital we deploy. We calculate two ROCE
measures: i) Pre-tax ROCE for controlled operations only and ii)
Post-tax ROCE including associates and joint ventures. ROCE
calculated using GAAP measures for the 12 months ended 31 March
2024 was 3.4% (FY23: 13.0%), impacted by gains on disposal in the
prior year of Vantage Towers A.G. and Vodafone Ghana, partially offset
by the loss on the disposal of Vodafone Hungary.
The table below presents adjusted ROCE metrics.
FY242
%
Re-presented1
FY232
%
Change
pps
Pre-tax ROCE (controlled)2,3
7.5%
8.2%
(0.7)
Post-tax ROCE (controlled and
associates/joint ventures)2,3
4.5%
6.1%
(1.6)
Notes:
1. The results for the year ended 31 March 2023 have been re-presented to reflect that the
results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations.
See note 7 ’Discontinued operations and assets held for sale’ in the consolidated financial
statements for more information.
2. FY23 ROCE calculations exclude the results of Vantage Towers until its disposal on 22 March
2023 and the investment in Oak Holdings 1 GmbH from that date. FY23 capital employed for
calculating post-tax ROCE (controlled and associates/joint ventures), FY22 Capital employed
for calculating pre-tax ROCE (controlled) and FY22 capital employed for calculating post-tax
ROCE (controlled and associates/joint ventures) have been adjusted to €57,911 million,
€56,192 million and €61,515 million, respectively, for the purposes of calculating relevant
FY23 averages.
3. ROCE is calculated by dividing Operating profit by the average of capital employed as
reported in the consolidated statement of financial position. Pre-tax ROCE (controlled) and
Post-tax ROCE (controlled and associates/joint ventures) are non-GAAP measures. See page
235 for more information.
Share buybacks
There were no share buybacks during the year ended 31 March 2024.
On 15 March 2024, the Group announced that the Board has approved
the capital return through share buybacks of up to €2 billion of
proceeds from the sale of Vodafone Spain. This is expected to
commence following the completion of the sale of Vodafone Spain.
This year’s report contains the Strategic Report on pages 1 to 69,
which includes an analysis of our performance and position, a
review of the business during the year, and outlines the principal
risks and uncertainties we face. The Strategic Report was approved
by the Board and signed on its behalf by the Group Chief Executive
and Group Chief Financial Officer.
Margherita Della Valle
Group Chief Executive
14 May 2024
Luka Mucic
Group Chief Financial Officer
14 May 2024
Dividends
The Board is recommending total dividends per share of 9.0
eurocents for the year. This includes a final dividend of 4.5 eurocents
which compares to 4.5 eurocents in the prior year.
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Financials
Other information
This year we have simplified and evolved our Purpose strategy to focus on ‘Empowering People’ and ‘Protecting the Planet’ in a digital society.
This is underpinned by our commitment to ‘Maintaining Trust’ in everything we do. This evolution from our previous three-pillar Purpose approach
reflects the importance of creating a digital society as Vodafone’s overarching aim, with a special focus on efforts to ensure the digital society is
inclusive and sustainable.
Read more
on pages 35 to 37
Empowering People
We want everyone to fully benefit from the digital society, regardless of who
they are or where they live.
Closing the digital divide
We are implementing new technology to roll out our network to rural
locations and increase access to smartphones in our markets.
Supporting communities
We provide relevant products and services which aim to address societal
challenges such as gender equality, financial inclusion and digital skills,
helping to increase productivity and enabling small businesses to thrive.
Supporting vulnerable communities
We provide connectivity and services to some of the most vulnerable groups
including refugees, those experiencing abuse or poverty, and after natural disasters.
Protecting the Planet
We help to protect our planet by reducing our environmental impact and
helping society decarbonise.
Net zero
We are working to reach net zero GHG emissions across our full value chain
by 2040.
Enablement
We are helping to enable our customers to reduce their own carbon
emissions by 350 million tonnes between 2020 and 2030.
E-waste
We are driving action with the aim of ensuring our network and device waste
is reused, resold or recycled.
Read more
on pages 38 to 42
Click or scan to learn more about
how we help improve digital inclusion:
investors.vodafone.com/videos
Click or scan to learn more about
our approach to cyber security:
investors.vodafone.com/videos
Click or scan to learn more about
our net zero goal:
investors.vodafone.com/videos
Click or scan to learn more about
our human rights approach:
investors.vodafone.com/videos
Click or scan to learn more about
our approach to data privacy:
investors.vodafone.com/videos
Click or scan to learn more about
our approach to tax:
investors.vodafone.com/videos
Maintaining Trust
Maintaining trust with our customers, employees, suppliers and the societies we serve is at the heart of everything we do.
Read more
on pages 45 to 51
Customers
Customers trust us with their data
and maintaining this trust is critical.
Data privacy
We respect the privacy preferences
of our customers and help improve
society through the responsible
use of data.
Cyber security
As a provider of critical national
infrastructure and connectivity that
is relied upon by millions of
customers, we prioritise cyber
and information security across
everything that we do.
Read more
on pages 51 to 53
Society
We aim to ensure that our business
operates ethically, lawfully and with
integrity.
Human rights
We seek to contribute to the protection
and promotion of human rights and
freedoms.
Tax and economic contribution
As a major investor, taxpayer and
employer, we make a significant
contribution to the economies of the
countries in which we operate.
Anti-bribery, corruption and fraud
We have a policy of zero tolerance
towards bribery, corruption and fraud.
Employees
We create a safe and inclusive
environment for our
colleagues.
Health and safety
Creating a safe working
environment for everyone
working for, and on behalf of
Vodafone.
Workplace equality
We seek to develop a diverse
and inclusive global workforce
that reflects the customers and
societies we serve.
Read more
on pages 15 to 20
Suppliers
We collaborate with our
suppliers to promote
sustainable and responsible
business practices along the
entire value chain.
Responsible supply chain
We manage relationships with
our direct suppliers and
evaluate their commitments to
diversity, inclusion and the
environment.
Read more
on page 52
Our approach to ESG
We connect for a better future
Purpose, sustainability and responsible business
We address Environmental, Social and Governance (‘ESG’) topics through our Purpose strategy, with the goal
of enabling an inclusive, sustainable and trusted digital society.
Our purpose is to connect for a better future. We aim to build an inclusive, sustainable and trusted digital society
where individuals and businesses can thrive.
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Financials
Other information
85%
4G population coverage
We aim to connect
everyone to digital
services by expanding
network coverage to
rural communities in
Europe and Africa.
66.2m
million customers2
connected to our financial
inclusion services
We aim to connect 75
million customers to
mobile money and
financial inclusion
services by 31 March
2026.
3.3m
V-Hub unique visitors
To better support micro,
small and medium
enterprises (‘MSMEs’)
across Europe and
Africa, Vodafone
Business offers V-Hub,
its digital advice service3.
35%
women in
management and
senior leadership roles
We aim to have
40% women in
management roles
by 2030.
100%
electricity used in
Europe matched with
renewable sources
Target achieved from
July 2021, four years
ahead of our original
2025 target.
59%
reduction in
Scope 1 and 2 GHG
emissions since 2020
Aiming for net zero
operations in Europe
by 2028 and in Africa
by 2035.
External ESG assurance
KPMG LLP has provided independent limited assurance over selected
data within our ESG Addendum and this report, using the assurance
standards ISAE (UK) 3000 and ISAE (UK) 3410 for selected
greenhouse gas (‘GHG’) data. KPMG has issued an unqualified opinion
over the selected data, and their full assurance statement, along with
the reporting criteria, is available in our ESG Addendum.
Reporting frameworks
Vodafone reports against a number of reporting frameworks to help
stakeholders understand our sustainable business performance:
Our Global Reporting Initiative (‘GRI’) disclosure is included in
our ESG Addendum.
Click to download our ESG Addendum:
investors.vodafone.com/esgaddendum
Disclosures are prepared in accordance with the Task Force
on Climate-related Financial Disclosures (‘TCFD’) framework.
Read more in our Climate-related risk section
on pages 64 to 69
Disclosures are prepared in accordance with the Sustainability
Accounting Standards Board’s (‘SASB’) Standards.
Click to read our SASB disclosures:
investors.vodafone.com/sasb
Vodafone supports the Ten Principles of the United Nations
Global Compact (‘UNGC’).
Click to read our 2024 UNGC Communication on Progress:
unglobalcompact.org
Vodafone participates in the CDP’s annual climate
change questionnaire.
Click to read our CDP response:
vodafone.com/sustainability-reports
GRI
TCFD
SASB
UNGC
CDP
Read more on pages
38 to 39
Read more on page 35
Read more on pages
36 to 37
Read more on page 36
Read more on page 18
Read more on pages
39 to 40
Read more about the governance underpinning our Maintaining Trust
practices on pages 53 to 54
ESG Committee
Executive Committee
Board
Empowering People
Executive-level sponsor:
Serpil Timuray
Protecting the Planet
Executive-level sponsor:
Joakim Reiter
Our ESG targets, reporting and governance
Over the past year we have progressed against our ESG targets. These targets are supported by governance
from the Board level down, as well as a comprehensive reporting programme.
ESG and Reputation Committee
Maintaining Trust
Audit and Risk Committee
ESG governance structure
Executive Committee
The Executive Committee has overall accountability to the Board for
our purpose and sustainable business strategy and reviews progress
annually. Our ESG and Reputation Committee (‘ESGR’) meets monthly
and has responsibility to drive purpose activities and review the
submissions to the Board ESG Committee. We continue to include
ESG measures in the long-term incentive plan for our senior leaders,
and our purpose targets and activities have executive-level ownership.
Read more about remuneration
on pages 100 to 118
Board
The Board delegates responsibility for oversight of our ESG
programme to the ESG Committee, which regularly engages with our
Executive Committee twice a year to provide oversight of our ESG
strategy, sustainability activities and responsible business practices.
Read more about the ESG Committee
on pages 96 to 97
The ESG Committee meets with the Audit and Risk Committee
annually to review ESG annual reporting for which they have joint
responsibility.
Read more about the Audit and Risk Committee
on pages 89 to 94
ESG highlights1
Notes:
1. Continued operations only. Excludes Italy and Spain.
2. As at 31 March 2024.
3. These are cumulative figures since the V-Hub launch in July 2020.
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Our purpose
Purpose
Our purpose is to connect for a better future. We aim to
create a digital society where everyone can thrive. As
one of the largest European and African telecoms
companies, we acknowledge our unique position to
support making the world a better place.
Vodafone’s connectivity and digital services can transform our
customers’ lives. Every day, more than 300 million people and
businesses put their trust in us to connect them to those who matter
the most. We give people access to the digital tools that can help
them improve their lives and livelihoods. We support small, medium
and large businesses to serve their customers and grow. We offer
access to financial services for people and businesses left out of
traditional banking systems.
The opportunities offered by digital technology are numerous. By
connecting 187 million devices to our advanced networks, cloud and
Artificial Intelligence services, we are able to help facilitate farmers to
increase their yields, mayors to create smarter and greener cities, and
delivery drivers to reduce their fuel consumption. We seek to ensure
that governments can deliver essential public services digitally,
improving citizens’ access to education and healthcare.
The digital society we help to enable aims to make our communities
more prosperous and more resilient. However, we must seek to
ensure that as many people as possible are included and that
progress does not come at the cost of the planet. This is why we place
Empowering People, Protecting our Planet, and Maintaining Trust at
the heart of our purpose as a business, guiding everything we do.
Empowering People
We believe everyone should fully benefit from the digital society,
regardless of who they are or where they live. However, with a third of
the world’s population still offline, a digital divide between the
connected and unconnected persists. We focus on overcoming the
main barriers to connectivity by increasing network coverage,
increasing access to smart devices, and providing services aimed
specifically at bringing more women online.
We support millions of small businesses, with 3.3 million micro,
small and medium-sized enterprises (‘MSMEs’) accessing benefits
of digitalisation through our V-Hub. Our fintech services in Africa
connect more than 66.2 million people, helping to support
entrepreneurship, lift communities out of poverty and transform
national economies.
We are also there to support people in times of crisis. We provide vital
emergency connectivity and relief during major disasters. We connect
refugees to digital education and our emergency material transport
programme helps provide emergency relief in Africa.
Protecting our Planet
Digital technology has an important role to play in enabling the
climate transition, by helping reduce carbon emissions and
underpinning climate adaptation technologies.
However, recognising that technology can create its own impact on
our climate and nature, we strive to minimise the environmental
footprint of our operations, value chain and products and services.
We are working to reduce our environmental impact to reach net zero
across our full value chain by 2040. We drive energy efficiency in our
operations and seek to match our energy with electricity from
renewable sources.
Digital technology has been recognised as a key enabler of carbon savings.
We work with our business customers to build solutions to reduce
greenhouse gas emissions (‘GHG’) and lower their planetary impact.
As use of technology expands, we are playing our role in the growing
circular economy. We work to minimise the impact of the waste we
create from our own operations and encourage greater reuse, repair
and recycling of the hardware our customers use.
Maintaining Trust
Integrity is core to who we are and how we act at Vodafone.
Recognising that digitalisation can be disruptive and pose new
challenges, we want to be a trusted partner to customers, employees,
suppliers and the communities we serve in the digital society. We
protect their data, ensure that services are delivered securely and
responsibly, and provide guidance on how to navigate new
technology. We aim to respect human rights across all our operations,
and proactively manage risks in our supply chain.
We continue to foster a diverse and inclusive global workforce that reflects
the customers and societies we serve. We behave responsibly and
transparently and always strive to uphold the highest industry standards.
Read more
on pages 53 to 54
Materiality assessment
In FY24 we undertook a detailed stakeholder engagement
exercise to assess our ESG strategy and prioritisation of related
topics. The assessment provided an analysis of critical enablers
and identified emerging ESG issues relevant to our business, our
stakeholders and the societies in which we operate.
Identification of material issues was determined by extensive
stakeholder engagement. The views of employees, customers,
investors, suppliers and peers were gathered via surveys,
interviews and workshops. The preliminary results of the
assessment are scheduled for discussion at executive level and
will be presented to the ESG Committee.
This stakeholder engagement is a critical step on our journey
towards completion of our double materiality assessment (‘DMA’)
as required by the EU’s Corporate Sustainability Reporting
Directive (‘CSRD’). Once completed, the results of the DMA are
expected to drive our future strategic focus and non-financial
reporting as set out in the CSRD.
UN Sustainable Development Goals (‘SDGs’)
We have identified two primary SDGs where we and our partners
directly contribute to finding lasting solutions to social, economic
and environmental challenges and thereby accelerate the delivery
of many other SDGs.
SDG 9: Build resilient infrastructure, promote inclusive and
sustainable industrialisation and foster innovation.
SDG 17: Strengthen the means of implementation and
revitalise the global partnership for sustainable development.
Read more on our SDG alignment
on page 43
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Other information
additional 1,408 sites across these countries, providing 4G coverage
to an additional 13.8 million people.
Meanwhile, our partnership with AST & Science LLC seeks to develop
the first space-based mobile network. This is designed to connect
directly to consumers’ 4G and 5G devices without the need for
specialised hardware. This year we successfully made the world’s first
space-based 5G call using a conventional smartphone. The space-
based network is intended to enable even those in the hardest-to-
reach areas to connect to the internet, ultimately reaching an
estimated 1.6 billion people across 49 countries. This will include a number
of LDCs where coverage is currently lowest.
We are also partnering to increase capacity, quality and availability of
internet connectivity between Africa and the rest of the world
through the 2Africa submarine cable partnership. The system will
deliver more than the total combined capacity of all subsea cables
serving Africa today, supporting the growth of 4G, 5G and fixed
broadband access for hundreds of millions of people.
In Europe, we are investing in rural areas, helping small businesses
overcome barriers to connectivity and digitalisation.
FY24 network deployment1
4G sites
deployed
(000s)
4G population
coverage
Europe
68.0
99%
Africa
33.4
74%
Group (Europe, Africa and Turkey)
128.5
85%
Note:
1. Excludes discontinued operations in Italy and Spain.
Increasing smartphone ownership
The digital divide goes beyond coverage, and relates to usage
of networks already deployed.
Globally, 38% of the world’s population (three billion people) are not
using mobile internet despite living in areas with mobile broadband
coverage. This usage gap remains almost eight times the size of the
coverage gap.2 There are many barriers preventing the use of mobile
broadband, including lack of awareness, low digital skills, and the
prohibitive upfront cost of smartphones. Given that smartphones are
increasingly the main gateway to digital services, lowering the cost of
devices is key to addressing the digital divide.
Smartphone ownership is lowest in emerging markets. Only 45% of
adults in emerging markets own a smartphone compared to 76% in
advanced economies. Women are less likely to own a smartphone
than men. Affordability is one of the key challenges to smartphone
adoption. Smartphones can cost more than 70% of average income in
LDCs, making them unaffordable.
We recognise that we cannot solve this issue by ourselves, and in
2022 we co-chaired the ITU/UNESCO Broadband Commission for
Sustainable Development Working Group on Smartphone Access. The
working group drew upon the expertise of a cross-sectoral body of
commissioners and experts. The outcome report, ‘Strategies towards
universal smartphone access’ identified key interventions to make
smartphones accessible to all, including: increasing device financing
options; introducing fair taxation and import duties; and improving
distribution to remote areas. In addition, the working group
recommended investigating further the use of device subsidies and
pre-owned smartphones. We continue to work with partners to
address the barriers to smartphone ownership; for example, through
the GSMA Smartphone Access working group.
We want to spread the benefit of the digital society
to more people, regardless of who they are or
where they live. Firstly, through closing the digital
divide by connecting those who are still
unconnected. Secondly, by providing digital
services to help people and small businesses
prosper. Through Vodafone Foundation we support
some of the most vulnerable groups in society.
One third of the planet (2.6 billion) is still offline. In Africa, just 37% of
people are using the internet, and in the world’s least developed
countries the figure drops to 35%.1 Although the number of internet
users in low-income countries is growing, it remains below growth
requirements to achieve the UN’s target of universal meaningful
connectivity by 2030. This target is further threatened by high
inflation and the cost-of-living crisis, which has eroded real incomes
and pushed millions more into poverty.
The internet is a vital part of everyday life, enabling us to
communicate, and to access entertainment and vital services such as
mobile money. Research from the World Bank shows that mobile
broadband can reduce the number of households in extreme poverty
by four percentage points. Expanding broadband penetration across
Africa by 10% could boost GDP per capita by 2.5%.2
Likewise, we know that MSMEs are less likely to use digital services
compared to their larger counterparts. More than 1.2 million
European businesses with fewer than 250 employees are not yet
digitalised, to compete globally and increase resilience, they need to
access the digital opportunities of the future. This will provide an
economic boost to the economies where the MSMEs operate as they
contribute in excess of €4 trillion to the EU economy annually.
Our Empowering People strategy focuses on three key areas to
ensure that everyone benefits from the digital society. Firstly, we want
to close the digital divide through targeted interventions to bring
those who are still unconnected online. Secondly, we want to provide
a range of digital services that help people and small businesses
prosper online. Finally, through our Vodafone Foundation we support
some of the most vulnerable groups in society who often fall outside
our customer base, including refugees and victims of domestic abuse.
Closing the digital divide
Increasing broadband coverage
Connecting everyone to digital services, particularly across Africa, is a
significant challenge. Fixed and mobile services are increasing
globally, with 4G mobile broadband networks reaching 90% of the
world’s population, but coverage in sub-Saharan Africa lags behind at
65%.1
Expanding coverage to rural networks remains a key focus for us, with
25% of the EU population and 58% of the population in sub-Saharan
Africa living in rural areas.2 Expansion of rural networks can often be
more challenging and have a lower return on investment due to lower
population densities. New approaches, partnerships and a blend of
technologies across land, sea and space will help us to overcome
some of these barriers and help deliver universal coverage.
In order to drive digital inclusion to the hardest-to-connect
communities, we continue to make good progress on our goal to
bring 4G to an additional 70 million people in sub-Saharan Africa (as
part of our participation in the UN Partner2Connect digital coalition in
March 2022). This targeted intervention includes four of the least
developed countries (‘LDCs’) – Mozambique, Tanzania, Lesotho and
the Democratic Republic of the Congo (DRC) – and will help to close a
particular gap in internet usage between urban communities and rural
communities. During the year we have added 4G technology to an
Empowering People
Notes:
1. The State of Mobile Internet Connectivity Report, GSMA, 2023.
2. World Bank, 2022.
Click to read the UN General Assembly Report:
broadbandcommission.org
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Purpose (continued)
Supporting communities
Building platforms for financial inclusion
Goal: To connect 75 million people and their families to mobile
money services by 31 March 2026.
Globally, 1.7 billion adults do not have a bank account, but among them, an
estimated 1.1 billion have a mobile phone.2 Digital services are key to
helping people access safe, secure financial services. Without the ability
to transfer money, people are limited in their ability to save, access
loans, start a business and even be paid. Together with Safaricom, we
developed the first mobile money platform, M-Pesa, which provides
financial services to millions of people who have a mobile phone but
have limited access to a bank account. Mobile money is also widely
used to manage business transactions, pay salaries, pensions,
agricultural subsidies and government grants, and reduces the risks of
robbery and corruption in cash-based societies. In Egypt, Vodafone Cash
is a comprehensive e-wallet and financial services platform, catering to the
needs of the unbanked, two thirds of the Egyptian population. In
addition, some markets benefit from insurance offerings. Through
VodaPay, customers in South Africa can access payment products
and services, including lending and insurance.
In Ethiopia, Safaricom was awarded a licence to provide mobile money
services in May 2023, launching M-Pesa in the country three months later.
Over 33 billion transactions amounting to more than €351 million were
made in the year using M-Pesa, the equivalent of around 4 million per hour
on average through a network of more than 617,000 agents. M-Pesa is also
accepted by over one million merchants. As of the end of March 2024, 66.2
million customers were using Vodafone’s financial inclusion services.
Mobile money customers
Financial
inclusion
customers
(million)
%
of service
revenue
%
penetration
of base
South Africa
2.6
-
-
Tanzania
10.2
36%
63%
Egypt
8.2
6%
22%
Mozambique
5.8
27%
68%
Democratic Republic of the Congo
5.5
21%
45%
Lesotho
0.9
16%
86%
Vodafone Group
33.2
-
-
Safaricom (Kenya and Ethiopia)
33.0
42%
88%
Supporting small businesses to thrive in a digital world
MSMEs are the lifeblood of many communities, providing
opportunities for socio-economic participation, as well as social
mobility for women, young people and ethnic minorities.
Through Vodafone Business, we provide products and services that
are specifically tailored for MSME and, small-office home-office,
(‘SOHO’) businesses, helping guide them through technology choices
and improving their digital readiness. These segments also represent
a significant commercial opportunity for Vodafone. We estimate that
the total addressable market for MSME and SOHO customers in our
markets3 is €45 billion, and we currently have over five million MSME
and SOHO customers.
To better support MSMEs across Europe and Africa, Vodafone
Business offers V-Hub, its digital advice service. This free service
provides access to online information and connects MSMEs with
experts who provide one-to-one advice and support on digitally
transforming businesses in an ever-changing digital world.
In Africa, we continued to expand device-financing options. In South
Africa, the Easy2Own payment plan now allows customers to
purchase a smartphone with an upfront deposit and a payment plan
with monthly, weekly or daily instalments. Airtime or data is allocated
based on the instalment payment being made. Over 3,700 customers
have signed up to Easy2Own. Lipa Mdogo Mdogo (Pay Little by Little)
has been running in Kenya since 2020. The partnership between
Safaricom, Google and Meta offers a flexible payment plan from as
little as KSh20 a day. This initiative is also supporting the digitalisation
of the farming sector, where devices are bundled with DigiFarm, a free
Safaricom service that offers farm inputs at discounted prices, input
loans and learning content. Since the launch in 2020, 1.2 million 4G
devices have been connected through Lipa Mdogo Mdogo.
Safaricom Kenya, in a joint venture with TeleOne and Jamii Telkom,
has also established the country’s first smartphone assembly plant to
kick-start production of locally-assembled smartphones. The factory
has the capacity to produce up to three million smartphones
annually, which are expected to be up to 30% cheaper than imported
smart phones. It is also projected that it will generate between 300
and 500 direct jobs, foster local talent development and contribute to
the country’s economic growth.
Addressing the digital gender gap
The majority of those still unconnected are women.
The digital gender gap continues to grow in many less developed
countries, creating a specific need to support digital gender equality.
In 2023, 70% of men were using the internet globally, compared with
65% of women. In LDCs just 30% of women used the internet in 2023
compared to 93% in high-income countries. Research indicates that
women who have access to mobile internet via a smartphone have
9% higher levels of wellbeing than women who have access via a
basic or feature phone. However, across low and middle-income
countries, women are 17% less likely than men to own a smartphone
and 19% less likely to use mobile internet.1
Vodafone’s aim is to realise digital gender equity, giving everyone the
opportunity to benefit from safe, enriching, productive and affordable
online experiences. Through fair and equitable digital transformation,
we can support the delivery of the UN Sustainable Development
Goals, addressing some of humanity’s greatest challenges. Therefore,
in order to progress towards digital gender equity, this year we began
evolving our Connected Women strategy to focus on measuring
gender equity across our markets in order to monitor progress.
Focusing on creating relevant services for women is also a key strategy
to bring more women online. Through connectivity, we seek to support
positive outcomes for women in education, skills and jobs, health and
wellbeing, safety and economic empowerment. For example, in many
African markets, gaining access to quality health information and
antenatal care can be very difficult. Information delivered by mobile
can help to bridge the gaps in crucial, basic information. Responding to
this, our Mum & Baby service continues to grow, giving customers
free access to maternal, neonatal and child health information in our
African operations. The service helps parents and caregivers to take
positive actions to improve their children’s health. In the DRC, the
initiative Je Suis Cap, (‘I am Capable’), provided 950 women living with
disabilities, free financial education provided jointly by M-Pesa and
Visa. Each woman received a starter kit to establish their own business
as an M-Pesa agent.
Notes:
1. The State of Mobile Internet Connectivity Report, GSMA, 2023.
2. World Economic Forum, 2022.
3. Includes the Netherlands, where we have our Joint Venture, VodafoneZiggo.
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Notes
1. FAO, 2024.
2. Cumulative figure from 1 April 2019 to 31 March 2024.
3. Cumulative figure from 1 April 2022 to 31 March 2024.
4. OECD, 2023.
5. Percentage reduction since 2018.
Beyond our direct customers, we are working to support MSMEs in
our supply chain. We offer optional supply chain financing, which
allows suppliers to leverage Vodafone’s credit position to access
cheaper funding and liquidity. This has no impact on Vodafone’s
commercially negotiated payment terms.
Digitalising key sectors: agriculture and healthcare
According to the Food and Agriculture Organization, by 2050, the
world will need to produce 70% more food than current levels.1 There
is also a growing need to address the environmental impact of
agriculture.
Through Vodacom’s subsidiary Mezzanine, we are helping to digitalise
agriculture in Sub-Saharan Africa through a second generation eVuna
platform. eVuna is Mezzanine’s smallholding agriculture product
suite. The product suite includes various software as a service (SaaS)
offerings, as well as a Marketplace. The eVuna software line offered to
farmers includes dairy management, seasonal and evouchering.
In Kenya, using eVuna evouchering, Safaricom supported the Kenyan
Ministry of Agriculture, Land, and Fisheries (‘MoALF’) with the rollout
of a government fertiliser subsidy to over 5.9 million smallholder
farmers in around 40 counties throughout Kenya. These vouchers can
be used to buy inputs to support maize, rice, and coffee cultivation.
Another solution we have in Kenya is our dairy management software,
an SMS-based system that digitally records and reconciles litres of
milk delivered by each farmer to the milk cooperative. The system
also stores the information on a client-facing dashboard, which
provides accurate records of each day’s produce by automatically
adding the amounts reported. Following this, the totals are sent to
farmers via a daily SMS, in replacement of a manual dairy milk card
which was used for many years. In FY24, this catered to over 50,0002
dairy farmers.
In South Africa, Mezzanine continues to support the Department of
Agriculture, Land Reform, and Rural Development (‘DALRRD’). This
programme has issued over 270,000 vouchers3 to smallholder
farmers, worth a combined value of over ZAR 1.6 billion3.
The global healthcare sector continues to grapple with
unprecedented transformation and challenges, as the effects of the
COVID-19 pandemic persist. The convergence of an ageing
population, a shortage of skilled health and social care professionals,
and a challenging economic climate has continued to disrupt
healthcare systems worldwide4.
Amidst these challenges, the sector has witnessed significant
digitalisation efforts, including the expanding role of electronic health
monitoring solutions and the adoption of artificial intelligence (‘AI’)
and analytics. At the core of these efforts lies the crucial role of robust
connectivity infrastructures. Technologies like 5G are already making
a significant impact and provide numerous use cases that simplify the
work of healthcare professionals.
In Portugal, we introduced an innovative solution called ‘Hospital@
Home’. This remote patient monitoring solution enables healthcare
professionals to monitor and clinically evaluate vital patient data,
including blood pressure, heart rate, blood glucose and more. The
connected solution ensures uninterrupted capture and secure
transmission of patient data to medical professionals.
In Germany, we established dedicated 5G networks at Frankfurt
University Hospital and University Hospital Schleswig-Holstein.
These networks, with their low latency, facilitate diagnostic data
transmission, enabling clinicians to make timely patient diagnoses.
Supporting vulnerable communities
Recognising that some of the most vulnerable in society can fall
outside our customer base and may struggle to access our commercial
propositions, we continue to provide a suite of targeted services for
vulnerable groups. During FY24 we continued to grow our Connected
Education programme, providing access to our ready-made classroom,
which includes connectivity, devices and collaboration software for
students and teachers across the world.
Vodafone Foundation continues to connect refugee and host
community students to a quality digital education through the Instant
Network Schools programme, developed and delivered in partnership
with UNHCR and the UN refugee agency, in the DRC, Egypt, Kenya,
South Sudan, Tanzania and Mozambique.
Since 2013, we have worked with the UNHCR on Instant Network
Schools to transform classrooms into multimedia learning hubs,
complete with internet connectivity, sustainable solar power, classroom
kits including tablets, laptops, projectors and speakers, localised digital
content, and teacher training. In FY24, 32 new Instant Network Schools
were deployed, taking the total number of schools in operation to 118,
with over 274,000 students and 4,700 teachers having benefited from
the programme. By the end of 2025, Vodafone Foundation and UNHCR
are aiming to reach 500,000 refugee and host-community students and
10,000 teachers with our Connected Education programme.
In addition to its work supporting refugees, Vodafone Foundation
published research in October 2022 that showed 92% of teachers
surveyed believe that schools have a responsibility to promote digital
literacy, but only a fifth are competent in the use of digital technologies.
The Foundation is working to address this through ‘SkillsUpload Jr’,
which supports young people to thrive in a digital society through
digital skills training for teachers and students, tools for use in schools
and access to teaching materials and lesson plans via online platforms.
Beyond education, the Foundation is using mobile technology with the
aim of helping to protect people and save lives at scale. Through
‘m-mama’, our technology is contributing to the reduction of maternal
mortality, the number one health goal of the SDGs, by increasing access
to emergency transport. The first region in Tanzania to fully deploy the
m-mama system saw a 38% reduction of maternal mortality5. The
programme, which is also preparing to launch in Kenya in 2024,
provides a national, 24/7 emergency transport system for women and
newborns in need, by coordinating ambulances and volunteer car
owners from a woman’s village or local health facility, to transport them
to higher level medical care.
At the same time the Foundation has also supported 2.6 million people
affected by abuse and hate crime by connecting them to information,
advice and support through a suite of apps. The Bright Sky platform is
accessible across four continents, to anyone who is concerned about
domestic abuse. In addition, the UK app, Zoteria promotes the safety
and wellbeing of the LGBTQ+ community.
Click to read more
www.vodafone.com/vodafone-foundation
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Purpose (continued)
Protecting the Planet
We provide connectivity and digital solutions that help to
enable the climate transition and aim to empower others
to reduce GHG emissions, protect nature and improve
the efficiency of resource usage. We are working to
minimise the environmental footprint of our operations,
our value chain and our products and services – by
reaching net zero and improving the circularity of the
technology we use and sell. This year, we continued to
embed our Planet strategy across our business.
Our Protecting the Planet strategy centres around three key areas:
net zero, enablement and circularity. During the year, we reviewed
our near and long-term Planet goals against our business plans,
opportunities and external constraints, which led to the refresh of
some of our goals at the end of this financial year.
Our Planet goals
2025
– Match 100% of the grid electricity we use globally with
electricity added to the grid from renewable sources1,2
– Reuse, resell or recycle 100% of our network waste
2028
– Net zero GHG emissions from our operations
(Scope 1 and 2) in Europe3,4,5
2030
– Reduce GHG emissions from our operations
(Scope 1 and 2) by at least 90%2,4,5
– Halve GHG emissions from our value chain (Scope 3)2,4
– Enable 350 million tonnes of carbon emissions to be
avoided through green digital solutions6
2035
– Net zero GHG emissions from our operations (Scope 1 and 2) in
Africa3,4,5
2040
– Net zero GHG emissions across our full value chain (Scope 1, 2 and 3)4,7
Notes:
1. Our renewable electricity purchasing is partly enabled through the procurement of
renewable electricity certificates, which certify that electricity has been added to the grid
from renewable generation sources (‘RECs’), such as wind, solar and hydropower.
2. These goals are part of our SBTi-validated near-term target, which was re-validated this year. The
Scope 1 and 2 GHG emissions target was revised as part of the revalidation process to align with
the SBTi Corporate Net Zero Standard, which targets a minimum 90% emissions reduction. This
target was previously presented as a 90-95% emissions reduction in our FY23 Annual Report.
3. During the year, we introduced these goals to reflect the two pathways we have set towards
net zero operations (Scope 1 and 2) – specific to the regions where we operate (Europe and
Africa). These regional net zero goals replace our previous goal (net zero emissions from our
operations (Scope 1 and 2) globally by 2030) to support transition planning within each
regional context (see our Climate Transition Plan for more detail of our transition pathway).
These goals include a minimum 90% emissions reduction, with any remaining emissions
neutralised through carbon offsetting from the net zero target year.
4. Against a baseline of financial year ended 31 March 2020 from our continuing operations.
5. Our Scope 1 & 2 GHG emissions are those that come directly from continuing operations under
our operational control and indirectly from the energy we purchase and use in those operations.
6. Cumulatively from 2020 to 2030, based on carbon emissions avoided by our business
customers through the use of digital solutions (products and services) that we sell.
7. This goal is part of our SBTi-validated long-term net zero target, which was approved this year. This
includes at least 90% absolute reduction in Scope 1, 2 and 3 GHG emissions.
Click to download our ESG Addendum:
investors.vodafone.com/esgaddendum
Click to read our ESG Addendum Methodology document:
investors.vodafone.com/esgmethodology
Net zero
Climate Transition Plan
We are proud to publish Vodafone’s first Climate Transition Plan in
2024, which outlines the actions we plan for FY25 to FY27 to reduce
GHG emissions in line with our net zero pathway and build resilience
into our business in response to our changing climate. Our Climate
Transition Plan signifies a step-change in how we have embedded
decarbonisation into our business and financial planning process.
Climate transition planning has enabled us to look at our business
plans with greater granularity and develop emission reduction
pathways appropriate to each region, whilst retaining our
commitment to our SBTi-validated climate targets.
Click or scan to watch a video
summarising how we plan to reach
net zero by 2040:
investors.vodafone.com/videos
Our Climate Transition Plan includes actions to build the climate
resilience of our business model in response to the physical impact of
climate change and changes driven by the transition to a lower-
carbon economy. Once again this year, we reviewed our exposure to
climate-related risks and opportunities as part of a scenario analysis.
Click to read our
Climate Transition Plan:
vodafone.com/ctp
Goals: To reduce the greenhouse gas emissions (‘GHG’) from our own
operations (Scope 1 and 2) to net zero in Europe by no later than
2028 and in Africa by no later than 2035, and across our full value
chain (Scope 3) by 2040.
We recognise the need to address the global climate crisis. In 2023,
public awareness of the climate impact of technology continued to
grow. Creating a more digital society is core to our purpose at
Vodafone. This inevitably comes with increasing volumes of internet
use and mobile data traffic, which have historically correlated to
increased GHG emissions. We continue to work to drive down our
emissions in absolute terms as well as shifting our energy mix to
renewable sources, in line with what is required by science to avoid
the most negative impacts of climate change.
In FY24, our long-term climate goal – to achieve net zero GHG
emissions across our full value chain (Scope 1, 2 and 3) by 2040 – was
validated by the Science Based Targets initiative (SBTi). This reinforces
our commitment to science-based emission reductions from our own
operations, our supply chain and the products and services we sell.
Read more about our climate-related risk and opportunities
in our TCFD-aligned disclosure on pages 64 to 69
Our FY24 performance: Our total Scope 1 and Scope 2 (market-based)
GHG emissions decreased by 24% to 0.69 million tCO2e (tonnes of
carbon dioxide equivalent). This equates to a 59% reduction from our
2020 baseline. Our Scope 3 GHG emissions decreased 12% to 6.07
million tCO2e, representing a 20% increase from our 2020 baseline.
We were proud to be A-rated by CDP for climate change again in
December 2023.
Net zero operations (Scope 1 and 2 GHG emissions)
Over the year, we continued to reduce GHG emissions from our
operations and the energy we purchase and use in those operations
(Scope 1 and 2 GHG emissions), with a focus on driving energy
efficiency across our mobile and fixed-line networks, phasing out the
use of fossil fuels and increasing renewable sources of energy for
both our stationary equipment and vehicle fleet.
Driving energy efficiency
Improving energy efficiency continued to be a strategic priority for
Vodafone, to control both energy costs and GHG emissions. Energy
use by our mobile access network, fixed-line network and technology
centres accounted for 93% of our total global energy consumption.
Energy efficiencies were achieved through a wide range of initiatives
including modernisation of legacy equipment with new generation
and highly efficient network equipment, new software functionality
that reduces energy consumption in low-load conditions, improving
energy efficiency in our data centres, digital solutions for energy
optimisation, and rationalisation of our properties. We invested €31
million of capital expenditure in energy efficiency and on-site
renewable projects, which led to annual savings of 11 GWh.
In FY24, Vodafone launched a global tender for new network
equipment for our radio access network (‘RAN’). The scope of the
tender includes approximately 170,000 of our mobile access base
stations. It aims to further improve network energy efficiency through
deployment of the latest generation of network equipment products,
such as more efficient power amplifiers, new network technology
architectures such as ´OpenRAN´ and smart power-saving features.
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Our performance1,2,3
Unit
2024
2023
Total Scope 1 and Scope 2 emissions (market-based) from continuing operations
Million tonnes of CO2e
0.69
0.91
Scope 1 emissions from continuing operations
Million tonnes of CO2e
0.26
0.25
Scope 2 emissions (market-based) from continuing operations
Million tonnes of CO2e
0.43
0.66
Scope 2 emissions (location-based) from continuing operations
Million tonnes of CO2e
1.75
1.70
Total Scope 3 emissions from continuing operations4
Million tonnes of CO2e
6.07
6.92
Total Scope 1 and Scope 2 emissions (market-based) from discontinued operations
Million tonnes of CO2e
0.01
0.02
Scope 1 emissions from discontinued operations
Million tonnes of CO2e
0.01
0.01
Scope 2 emissions (market-based) from discontinued operations
Million tonnes of CO2e
0.01
0.00
Scope 2 emissions (location-based) from discontinued operations
Million tonnes of CO2e
0.36
0.37
Total Scope 3 emissions from discontinued operations4
Million tonnes of CO2e
0.77
0.89
Total Scope 1 and Scope 2 emissions (market-based)
Million tonnes of CO2e
0.71
0.92
Scope 1 emissions
Million tonnes of CO2e
0.27
0.26
Scope 2 emissions (market-based)
Million tonnes of CO2e
0.44
0.66
Scope 2 emissions (location-based)
Million tonnes of CO2e
2.11
2.06
Total Scope 3 emissions4
Million tonnes of CO2e
6.84
7.80
Renewable electricity
Percentage of purchased electricity from renewable sources
%
84
75
Percentage of purchased electricity from renewable sources from continuing operations in Europe
%
100
100
Vodafone total energy use from continued operations
Gigawatt hours
5,217
5,052
Notes:
1. Data is calculated using local market actual or estimated data sources from invoices, purchasing requisitions, direct data measurement and estimations. Carbon emissions are calculated in line with
GHG Protocol standards. Scope 2 market-based emissions are reported using the market-based methodology in effect as at the date of this report. For full methodology see our ESG Addendum
Methodology document: investors.vodafone.com/esgmethodology.
2. Data includes all entities within the control of Vodafone Group Plc during FY24, both continuing operations and discontinued operations (Italy and Spain), unless otherwise stated.
3. During the current year, information relating to 2023 and 2022 has been restated to reflect portfolio changes completed during 2023 and 2024.
4. Data for 2023 has been restated to reflect changes to our methodology for calculating emissions, see our ESG Addendum Methodology document for more information: investors.vodafone.com/
esgmethodology.
We continued to implement the ISO 50001 Energy Management
Standard globally across our operations. Certification was achieved by
an additional five of our operating companies, bringing the total number
of ISO 50001 certified markets to 16. Digitalisation of the energy system,
data and analytics are key enablers for optimising energy consumption
across our operations. Our energy data management and digital
artificial intelligence and machine learning (‘AI-ML’) based analytics
system, which collects and stores data from our electricity suppliers
and from smart meters, is now live across 10 markets in Europe and
one market in Africa, with smart meters installed at over 40,000 sites.
Click to read more about our energy efficiency initiatives:
vodafone.com
Switching to renewables
The majority of the energy we use in our operations comes from purchased
grid electricity. Our network also uses electricity generated by stationary
generators, which are mostly powered by fossil fuels (diesel or petrol).
Our fleet of vehicles is fuelled by a mix of diesel, petrol and, increasingly,
purchased electricity. This year, we continued our efforts to phase out
fossil fuels from our operations in favour of renewable energy sources.
Purchasing renewable electricity
Our goal is to match 100% of the grid electricity we use globally with
electricity added to the grid from renewable sources by 2025. This
year, 100% of the grid electricity used in our European network (FY23:
100%), and 84% globally, (FY23: 75%), was matched with electricity
from renewable sources. While maintaining our renewable electricity
purchasing in Europe, our main focus this year has been on creating
new models for renewable electricity purchasing in Africa, where
renewable electricity markets are significantly less mature.
In South Africa, we signed a first-of-its-kind ‘virtual wheeling’ agreement
with the national power producer – Eskom – which allows Vodacom
to secure renewable electricity from independent power producers
(‘IPPs’) that are connected to the national grid. The first phase is
underway and will see IPPs providing approximately 30% of Vodacom
South Africa’s power demand. Previously, this was not possible for a
company of the size and complexity of Vodacom, which has over
15,000 low-voltage mobile sites in 168 municipalities. This innovation
was co-developed by Mezzanine (a Vodacom subsidiary) and Eskom.
We are optimistic this project can make a positive difference to the
energy transition in South Africa, where regular planned power cuts
are implemented as Eskom seeks to prevent national blackouts
resulting from demand exceeding generation capacity. This virtual
wheeling model enables broader private sector participation, which
can help accelerate efforts to solve the country’s energy crisis.
In Egypt, we implemented an agreement, signed at COP27 in
November 2022, with the Egyptian Ministry of Electricity and Energy
to purchase renewable electricity from the New and Renewable
Energy Authority (‘NREA’). The agreement is the first of its kind in
Egypt, where a national system of renewable electricity certificates is
not yet established. As part of this agreement, the Egyptian Ministry of
Electricity and Energy will match the electricity used by Vodafone
Egypt’s mobile network with electricity added to the grid from
renewable sources over a one-year period, renewed annually. This
supports the investment case for growing the Egyptian renewable
energy sector and the development of a market mechanism to sell
and purchase renewable electricity and offers a reference for other
corporate renewable electricity buyers to follow.
In Europe, we continued to increase the proportion of electricity we
source directly from renewable generators through power purchase
agreements (‘PPAs’). We signed additional renewable supply in FY24
representing an increase in our long term contracted PPA volumes by
over 20%. We now have PPAs established in Germany, Greece,
Portugal and the UK. Those currently in operation delivered around
24% of the grid electricity we used in Europe1. From 2026 our PPAs
will be fully operational and they will generate approximately 39% of
our grid electricity demand in Europe1. PPAs provide us with more
price certainty against current volatile wholesale electricity prices.
The remainder of our electricity consumption is matched with
renewable energy certificates (‘RECs’) that we purchase through our
energy suppliers or from the REC market.
Click to read more about our renewable electricity purchasing strategy:
vodafone.com/renewables
Note:
1. Relates to electricity consumed by our continuing operations that has been purchased
exclusively for use by Vodafone via a PPA.
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Purpose (continued)
On-site renewable generation
We also continued to install and deploy new solar photovoltaic (‘PV’)
systems at sites in Germany, the UK, Turkey, Egypt and Albania. This
increased our annual on-site generation of renewable electricity to 21
GWh per annum.
We are seeking to expand our current implementation of micro-grids in
the DRC, as well as collaborating with partners to develop new innovative
solutions for renewable energy generation. For example, in Egypt we
have trialled a site powered solely from on-site solar and wind generation.
To get the most benefit from our on-site renewables, we have carried
out investigations into battery technology and have currently
identified sodium-ion batteries as the most promising technology for
energy storage. We have tested prototypes from a supplier with
positive results and are looking to carry out similar tests with
additional suppliers.
Reducing diesel and petrol use for generators
We used 76.3 million litres of diesel in FY24 (a 5.6% increase from
FY23: 72.3 million litres) to fuel generators at sites that are off-grid or
have unreliable grid electricity supply. Use of fuels in generators
contributed 79% to our Scope 1 GHG emissions (FY23: 78%).
Reducing diesel use continues to be particularly challenging in
markets with unreliable grids (where electricity supply from the
national grid is routinely interrupted due to insufficient generation),
such as the DRC, South Africa and Egypt. This year we conducted
further research into alternatives to diesel, including the feasibility
and environmental credibility of hydrotreated vegetable oil (HVO), a
bio-based fuel, with a view to establishing some proof-of-concept trials
over the coming year.
We are also testing hydrogen fuel cell technology in South Africa. The
technology comprises a fuel cell, an electrolyser and low-pressure
hydrogen storage whereby hydrogen is generated from water that is
recycled through a closed circuit. The technology can generate
hydrogen when renewable electricity is available – from the grid or
small scale on-site renewable power generation – which can be used
to power our mobile base stations when renewable electricity is not
available. We also continue to connect off-grid sites to the grid where
possible to minimise the use of generators.
Electrification of our fleet
We continued to increase the number of electric vehicles (EVs) in our
company fleet (with EVs making up 58% of the fleet compared to 51%
in FY23). We continue to improve the total cost of ownership for EVs and
deliver cost savings that can be reinvested into fleet electrification and
EV-charging infrastructure. This year, we introduced EV training and
organised EV test drives to raise drivers’ awareness. In November 2023, we
won Fleet Europe’s award for European Green Fleet Manager of the Year.
Net zero value chain (Scope 3 emissions)
We aim to halve the emissions from our full value chain by 2030 and
bring them to net zero by 2040 (against a 2020 baseline). This
includes our indirect (Scope 3) emissions, which we estimate to be
6.07 million tCO2e in FY24, 12% lower than the previous year),
forming 90% of our total GHG emissions.
We continued to strengthen the methodologies and underlying
assumptions used for calculating our Scope 3 emissions data. In line
with GHG Protocol standards, we recalculated our base year and
previous years’ Scope 3 emissions to account for recent organisational
changes, including the FY23 divestment of our operating companies in
Ghana and Hungary, and our tower company, Vantage Towers.
We also improved the accuracy of factors used in the spend-based
calculation of the embodied emissions of the goods and services we
procure. Using a spend-based methodology for calculating the
emissions from parts of our upstream supply chain means that
economic trends (such as foreign exchange rate fluctuations and
inflation) can also affect the modelling of our Scope 3 GHG emissions.
Our Scope 3 GHG emissions decreased by 12% compared to the
previous year. Since 2020, Scope 3 emissions have increased by 20%.
Currently, one of the key drivers of year-to-year trends in our Scope 3
emissions is improvements in the quality of data inputs, emission
factors or calculation methods. This year, we were pleased that more
of the companies in which we hold an equity stake have shared their
Scope 1 and 2 GHG inventory with us, indicating an increase in the
maturity of GHG measurement. In particular, this year we observed a
decrease in energy consumption by Vodafone Idea (India). Combined
with a decrease in the carbon intensity of India’s electricity grid, this
has driven a decrease in the emissions we finance through our
investments (Scope 3 Category 15), which has resulted in a significant
decrease in the Scope 3 GHG emissions from our investments. This
year we have also observed a decrease in lifecycle emissions
associated with devices that we purchase and sell to customers.
The continued evolution of Scope 3 data sources and methodologies
creates a significant challenge. Likewise, the low availability of
product carbon footprint data remains a constraint on the calculation
of accurate Scope 3 GHG emissions across the market. Improvements in
data quality and availability will help us continue to move away from
estimating using a spend-based methodology, towards methodologies
that use more specific product carbon footprint data provided by our
suppliers. We therefore continue to invest in improving our Scope 3
data models as better data sources become more accessible and
available. We have also continued to collaborate with our industry
peers through forums such as the Joint Alliance for CSR (‘JAC’) and
GSMA to improve access to high quality carbon data from our common
supply chain. Over time, these efforts aim to improve measurement
and reduction of Scope 3 GHG emissions across our industry.
To drive Scope 3 GHG emission reductions in FY24, we continued to
engage with our suppliers on climate action through our procurement
process, which includes a 20% weighting on ESG criteria (including
5% weighting on climate-related performance) during supplier
selection. Vodafone is a member of JAC, a telecommunications
industry organisation that promotes a consistent and simplified
approach to engaging suppliers and supporting the transition of our
industry towards net zero. Following its launch, our banking partners
also continue to roll out an environmental supply chain finance
programme, which offers financial incentives for our suppliers to
disclose carbon data to CDP and take action to improve their
environmental performance over time. We also progressed activities
to improve the circularity of devices we sell, which helps reduce our
Scope 3 GHG emissions and reduces e-waste.
Although we are pleased that our Scope 3 emissions have decreased
compared to the previous year, we recognise that they are 20%
higher than our 2020 base year. This has primarily been driven by
increases in our estimated emissions from two parts of our value
chain: upstream supply chain (from purchased goods and services,
and capital goods); and investments. In both cases, the accuracy and
completeness of the underlying data used to calculate the emissions
has improved since 2020. In relation to our upstream supply chain,
the increase in emissions also correlates to an increase in
procurement spend.
The 20% increase in our Scope 3 GHG emissions compared to 2020
means we are not yet on track to achieve our goal of halving Scope 3
emissions by 2030 and achieving net zero across our full value chain
by 2040. This year, we published our Climate Transition Plan, which
outlines actions we plan to take to further drive Scope 3 emissions
Click to read more about Scope 3
emissions in our ESG Addendum:
investors.vodafone.com/
esgaddendum
Read more about how
we are improving
Circularity on pages 41
to 42
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reductions – including increasing supplier engagement, building a
more circular economy for electronic devices, and engaging companies
we invest in to support their transition to net zero. We will implement
these planned actions in parallel with continued improvement of our
Scope 3 data modelling to better reflect our emission reduction efforts.
Enablement
Goal: To enable our business customers to reduce their own GHG
emissions by 350 million tonnes between 2020 and 2030 through the use
of our green digital solutions.1
Research suggests that 84% of existing Internet of Things (‘IoT’)
deployments have the potential to also address the UN Sustainable
Development Goals (‘SDGs’)2. With increasing adoption rates of IoT,
one of our most important contributions to protecting our planet is
enabling our customers, including consumers, businesses and
governments, to reduce their environmental footprint using our
digital technologies and services. We continued this journey with a
focus on using digital solutions to tackle climate change and help
decarbonise society.
Our FY24 performance: This year, we estimate we have enabled the
avoidance of 32.8 million tCO2e, which is around 75 times the
emissions generated from our own operations (Scope 1 and 2 in
FY24). Since setting our enablement target in 2020, we estimate we
have enabled our customers to avoid a cumulative 78.3 million tCO2e.
This year, we reviewed the emissions reduction impact of an additional
four green digital solutions within our product portfolio, including
connectivity solutions that use software defined local area networks
(‘SD LAN’). IoT products remain the most significant contributor to
enablement. We estimate that 55% of our 187 million IoT connections
directly enabled customers to reduce their emissions in the past year.
For example, we continue to support customers to improve operational
efficiency, reduce fuel costs and reduce their emissions through our
Vodafone Business Fleet Analytics solution, which helps our customers
to optimise routes and identify opportunities to electrify their fleet.
FY24 enablement overview1
Estimated GHG emissions avoided (million tonnes CO2e)1
2024
2023
Smart meters
4.4
3.7
Fleet management
3.9
3.3
EV charging
2.9
0.9
Healthcare
4.9
3.1
Other transport solutions and logistics solutions
15.8
13.3
Other (e.g. remote working, water leak detection)
0.8
0.6
Total emissions avoided (enablement)
32.8
24.9
Scope 1 and Scope 2 market-based emissions
(million tonnes of CO2e)
0.43
0.66
Enablement ratio
75.4x
38.2x
Cumulative total emissions avoided (since FY20)2
78.3
45.5
Notes:
1. Enablement data is estimated using the methodology detailed in our ESG Addendum
Methodology document: investors.vodafone.com/esgmethodology.
2. Cumulative total since FY20 is based on the total of FY21 to FY24 emissions avoided,
including restated FY22 emissions avoided as detailed in our ESG Addendum: investors.
vodafone.com/esgaddendum.
As part of our continued efforts to raise awareness of the role of digital
technology in the green transition, we hosted a summit for our Vodafone
Business customers in London in January 2024, on the theme of
‘Innovation for Impact’. The summit was attended by over 100 Vodafone
Business customers and visitors and included a range of talks and events
to help them think about our collective role in the green digital transition.
Vodafone is a founding member of the European Green Digital Coalition
(‘EGDC’). Since its establishment in 2021, we have actively participated
in the development of an ICT sector methodology for measuring the
carbon enablement impact, known as the ‘net carbon impact’, of green
digital solutions, leveraging the lessons learned from our own
experience of carbon enablement reporting over the past four years.
Circularity
Goals: To reuse, resell or recycle 100% of our network waste by 2025; to
collect 1 million used mobile phone devices for reuse, recycling or donation.
The UN estimates that as much as 50 million tonnes of electronic and
electrical waste (e-waste) is produced globally each year, with only
20% being formally recycled. As the use of technology expands and
develops, we are playing our part to address the growing global
e-waste problem. Our circular economy (‘circularity’) initiatives look at
two main types of e-waste; network equipment, such as radio
equipment used to run our fixed and mobile access networks and the
electronic devices that we sell to customers such as smartphones.
Our FY24 performance: We reused, resold or recycled 96% of network
waste in FY24 (FY23: 95%). In partnership with WWF, we have collected
337,680 used phones for refurbishment and reuse, recycling or donation,
which is 34% towards our ‘1 million Phones for the Planet’ goal.
Network waste
We implement resource efficiency and waste disposal management
programmes in all our markets to minimise environmental impacts
from network waste and IT equipment waste. This year, we generated
an estimated 6,205 tonnes of network waste equipment (including
hazardous waste) (FY23: 7,716). We reused, resold and recycled 96%
of the non-hazardous waste, partly via our asset marketplace, which
was established in 2020 to resell and repurpose excess or
decommissioned network equipment (thus extending its life cycle) by
enabling trading between our operating companies and across the
telecommunications industry. This year, we estimate that we have
saved €3.9 million of spend and avoided over 398 tCO2e through our
asset marketplace platform. This is in addition to our strategy to reuse
equipment within individual operating companies. For example,
Vodafone UK avoided an estimated 1,045 tonnes of CO2e in FY24 by
reusing network equipment.
FY24 network waste management (excluding hazardous waste)1,2
2024
2023
Reused3
2%
2%
Recycled
94%
93%
Disposed4
4%
5%
Total network waste (metric tonnes)
3,831
4,633
Notes:
1. During the current year, information relating to 2023 has been restated to reflect the portfolio
changes during 2023 and 2024.
2. Excludes our discontinued operations in Italy and Spain.
3. Includes network equipment resold between markets where we operate, or to external third parties,
for reuse for the same purpose.
4. Disposed network waste includes used network equipment that is disposed to landfill or incineration.
Devices
We are exploring a range of ways to help build a more circular economy
for home and mobile devices, including collection of used devices,
supporting refurbishment and reuse, increasing recycling of end-of-life
devices, and improving the market availability of more sustainable devices.
Collection
Over the year, we continued with campaigns, initiatives and the
provision of services to support our customers to keep electronic
devices in use for longer – through repair, refurbishment and reuse.
When devices reach the end of their useful life, our aim is for them to
be responsibly recycled instead of being sent to landfill.
Notes:
1. Target currently under review in light of evolving methodologies for measuring the ‘net
carbon impact’ of digital solutions.
2. WEF, 2020
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Purpose (continued)
This year, we introduced a target to collect 1 million used mobile phone
devices for reuse, recycling or donation. This new target relates to our
campaign to collect ‘1 million Phones for the Planet’, which was
launched in November 2022 in partnership with WWF. Since the start
of the campaign, we have collected an estimated 337,680 used phones
for refurbishment and reuse, recycling or donation to social causes.
Increasing the rate of collection of used devices is an essential step in
building a more circular economy for mobile phones and preventing
them from ending up in landfill. Partnering with WWF on this
campaign has enabled Vodafone to raise the profile of the
environmental importance of bringing back e-waste. Since launching
the campaign, we have worked together with WWF on campaign
communications and promotional materials that build consumer
understanding and raise awareness of the issue of e-waste.
Click to see how we are supporting more of our customers to switch to green
vodafone.com/sustainable-business/switch-to-green
Reuse
Our ‘trade in’ service encourages consumers to extend the lifetime of
their device by trading it in to be refurbished and resold. Our Group
trade-in programme is now live in three European markets through a
digital trade-in platform or via retail, offering customers a guaranteed
price to make the trade-in customer journey convenient, cost effective and
attractive. This year we increased the reach of our digital trade-in proposition
by expanding our digital platform to Portugal and Germany. Together
with our partner, Recommerce, we also launched our digital diagnostics
solution in the Czech Republic, with other markets to follow in 2024.
We are helping to build a more circular economy through our
products and services for business customers too. For example, our
Vodafone Business Device Lifecycle Management solution offers
companies a managed device-as-a-service solution with reuse and
recycling at end of life, helping our business customers to reduce the
environmental impact of mobile devices used by their workforces.
Recycling
We continued our ‘One for One’ campaign in Germany, in partnership
with Closing the Loop. This e-waste reduction initiative promises that
for every phone purchased directly from Vodafone by consumers in
Germany, one ’end-of-life’ phone will be collected and recycled.
Closing the Loop is a waste collector that solely works in countries
where e-waste is normally not properly collected and recycled. This
campaign diverts e-waste from landfill or improper recycling while
also enabling precious metals to be safely recovered from hazardous
waste. As at January 2024, our One for One campaign has enabled
the collection of over 1.1 million scrap mobile devices in Ghana,
equating to over 63,000 kilograms of e-waste, from which about
5,000 kilograms of precious metals (gold, silver and copper) will be
recovered. At least 3,000 monthly living wages have been created
since the start of the collaboration, thus supporting the livelihoods of
people in local communities and providing opportunities for them to gain
income and develop new skills.
Improving device sustainability
Vodafone is a co-founder of Eco Rating, a pan-industry eco-labelling
consortium for newly manufactured smartphones. It seeks to help
consumers identify and compare the sustainability of mobile phones,
enabling them to make more sustainable product choices. Through our
work as part of the consortium, we engaged with mobile device
manufacturers to encourage improvements in their Eco Rating score,
by improving overall environmental impact, including device circularity
and reducing GHG emissions – both of which also help to reduce the
Scope 3 GHG emissions from Vodafone’s upstream supply chain.
Eco Rating is now operational in 39 countries, supported by 22
manufacturers and a total of nine operators. Since its introduction, the
rating has contributed to improving the environmental performance
of mobile phones on the market, illustrated by the increase of the
average Eco Rating score from 74 to 77 out of a maximum 100
since it was launched in 2021. Vodafone now operates this initiative
in nine markets, with over 275 handsets assessed and available to
our customers.
Click to learn more about our work as part of Eco Rating:
vodafone.com/sustainable-business/switch-to-green
We also encourage our customers to consider purchasing ‘second-
life’ refurbished devices. Purchasing a refurbished smartphone saves
around 50 kilograms of CO2e, making its contribution to climate change
87% lower than that of the equivalent, newly manufactured smartphone,
and removes the need to extract 77 kilograms of raw materials.1
We offer customers high quality and competitively priced refurbished
smartphone ranges in UK, Turkey, and Vodacom South Africa.
We also design a number of home products including broadband
routers and TV set-top boxes. We have begun integrating sustainability
principles into the design process for our products and packaging. For
example, our new Vodafone Hub family of broadband routers was
designed using 95% post-consumer recycled resin, a mechanical
design to enable simpler refurbishment, energy optimisation features
and zero plastic packaging. This year, in recognition of the sustainable
features of its product design (including use of recycled materials,
durability, repairability and energy efficiency), we also obtained TÜV
Green Seal certification for our first Vodafone branded product, a
television set-top box.
Nature
The world is currently undergoing a dangerous decline in nature with
one million species threatened with extinction, impacting the lives of
billions of people and economies. In December 2022, 188
governments adopted the Kunming-Montreal Biodiversity Framework
consisting of four overarching goals to reverse the loss of nature by
2050. We recognise the need for a sustainable approach to nature
and in FY24 initiated a review of the biodiversity impacts, risks and
dependencies of our business operations, products and services.
Digital technology can be applied to enable interventions and actions
to protect, manage and restore nature. The so-called nature
technology market is expected to be worth $6 billion within 10 years.2
Our review highlighted the variety of nature technology solutions
Vodafone is already building across a number of ecosystems. Several
of our operating companies are taking action on biodiversity through
a range of initiatives appropriate for their local contexts. For example,
in South Africa, Vodacom has created an AI-based technology
solution to use cameras and hydrophones to identify and alert mussel
farmers to the presence of marine mammals including whales in
order to prevent entanglement in mussel farming ropes.
In Romania, the IoT team has created a system based on acoustic
sensors deployed in forest areas. The sensors pick up forest sounds
and the AI can identify the specific sound of logging and trigger the
sending of real time alerts with geolocation to forest administrators
and directly to rangers’ phones so they can intervene immediately.
This year, Vodafone Group has also successfully completed proof of
concept for mTwiga, our digital technology solution for preventing
human-wildlife conflict, which was developed by the winners of
Vodafone’s in-house innovation accelerator programme, Launchpad,
in 2022. mTwiga uses cameras with advanced video analytics and
AI-enabled software to recognise predator species (such as leopard,
hyena and lion) within close proximity to human settlements. mTwiga
is able to send real-time alerts to communities and rangers and is
designed to operate off-grid. Our field trials in Kenya in March 2024
identified a number of opportunities around bespoke AI models and
species deterrents that we hope to build on during 2024.
Notes:
1. Agence de l’Environnement et de la Maîtrise de L’Énergie (ADEME), 2022.
2. World Economic Forum, 2022.
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We contribute to the Sustainable Development Goals
The UN Sustainable Development Goals (‘SDGs’)
provide a blueprint for human progress and a clear call
to action for businesses to contribute to a better future.
The climate crisis, war and the lingering effects of the COVID-19
pandemic and other global crises have meant that the world is facing
a reversal of progress on many of the SDGs. At their mid-point, around
half are off-track and over 30% have regressed or stalled. Under
current trends, the UN estimates that 575 million people will be living
in extreme poverty by 2030 and 84 million children will be out of
school. Meanwhile, the world is at hunger levels not seen since 2005,
the window to limit the rise in global temperatures is closing quickly,
and it will take an estimated 286 years to close the gender gap.1
Digital technology will be essential in reducing these impacts and
helping progress towards delivering the SDGs. We are working to play
our part and believe we can increase the speed and scale of delivery
across a wide number of SDGs through leveraging our technology and
services, and through partnering with others. Simultaneously, we can
drive significant growth. For example, our M-Pesa and other mobile money
plaforms, designed to enable financial inclusion, has 66.2 million active
customers generating revenue this year of €351 million.
Note:
1. UN, 2023.
Industry, innovation
and infrastructure
Partnerships for
the goals
Through connectivity infrastructure, digital innovations and
partnerships, we deliver impact across many of the SDGs.
Examples of our projects and initiatives supporting
the SDGs over the last year
Read more about our contribution to the SDGs:
vodafone.com/sdgs
No poverty
Our ‘everyone.connected’ campaign in the UK has delivered
over £163 million in social value since May 2020 to
December 2023, helping customers deal with the
increased level of poverty due to cost-of-living increases.
Read more about our approach to the cost of living: vodafone.com
Sustainable cities and communities
Our IoT solutions help local governments take control of
their energy usage across multiple sites, improve air
quality via monitors and optimise waste collection.
Read more about our digital solutions to build sustainable cities:
vodafone.com/sustainable-business
We are a co-founder of Eco Rating, a pan-industry
eco-labelling consortium for newly manufactured
smartphones. We operate Eco Rating in 11 markets with
over 275 handsets assessed and available to our
customers.
Read more about Eco Rating for mobile phones:
vodafone.com/eco-rating
Responsible consumption
Good health and wellbeing
In Portugal, we introduced an innovative solution called
Hospital@Home. This remote patient-monitoring
solution enables healthcare professionals to monitor
and clinically evaluate vital patient data, including blood
pressure, heart rate, blood glucose and more.
Quality education
In 2024, 32 new Instant Network Schools were
deployed, taking the total number of schools in
operation to 118, with over 274,000 students and 4,700
teachers having benefited from the programme.
Read more about how Vodafone is providing digital learning through
connected education: vodafone.com
Gender equality
Vodafone Foundation’s Bright Sky app and website is live
in 13 countries, connecting nearly one million people
affected by domestic violence and abuse to information,
advice and support.
Read more at: www.vodafone.com/vodafone-foundation
Affordable and clean energy
In Africa, we enabled the implementation of the
first-of-its-kind virtual wheeling solution in South Africa
with Eskom. This will help accelerate efforts to solve the
country’s energy crisis and contribute to Vodacom’s
renewable energy targets. We also delivered a first for
Egypt, where the Egyptian Ministry of Electricity and
Energy will match the electricity used by the Vodafone
Egypt mobile network with electricity added to the grid
from renewable sources.
Read more about reducing GHG emissions in our operations:
vodafone.com/sustainable-business
We enable inclusive and sustainable digital societies
At Vodafone, we are accelerating connectivity and digitalisation in
order to achieve the SDGs by 2030. We have identified two priority
SDGs (SDG 9 Build Resilient Infrastructure, promote sustainable
industrialisation and foster innovation, and SDG 17 revitalise the
global partnership for sustainable development) that will enable
us and our partners to find lasting solutions to social, economic
and environmental challenges and thereby accelerate the delivery
of other SDGs.
The SDGs will only be achieved through partnerships, and we
continue to pioneer new models of co-operation between
business, governments, international organisations and civil
society to deliver progress and scale. For example, we were a
founding member of the International Telecommunication Union’s
Partner2Connect coalition to connect the unconnected.
In FY24, our partnership in Ethiopia with Safaricom PLC, Vodacom,
Sumitomo Corporation and British International Investment
received a major boost with news that the World Bank Group, one
of the world’s major development finance institutions has invested
in the business. Together with its partners, Safaricom Ethiopia has
committed to help meet Ethiopia’s SDGs and improve the
agriculture, medical, education, financial and tourism sectors of
the country by rolling out, launching and operating 4G and 5G
mobile networks across the entire country – including in rural and
urban areas.
We continue to develop our partnerships to address environmental
challenges. For example, our major global partnership with WWF
will support our goals to reduce carbon emissions to net zero by
2040 and encourage a more circular economy for mobile phones.
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As an integral part of our purpose, we need to ensure
that we are maintaining trust in everything that we do.
This section of the Strategic Report covers the elements
underpinning our responsible business strategy. On this page, we
explain how we embed an understanding of our Code of Conduct
throughout the Group and provide our people and suppliers with
access to a whistleblowing hotline (‘Speak Up’). This section also
summarises our approach to protecting data and people, as well as
how we ensure we behave ethically, lawfully and with integrity
wherever we operate.
Code of Conduct
Our Code of Conduct sets out what we expect from every single
person working for Vodafone, regardless of location. We also expect
our suppliers and business partners to uphold the same standards as
set out in our Code of Ethical Purchasing.
Click to read our Code of Conduct:
vodafone.com/code-of-conduct
Our Doing What’s Right (‘DWR’) training and communication
programme is key to embedding a shared understanding of the Code
of Conduct across Vodafone. Throughout the year, the DWR
communication programme promoted different areas of our Code of
Conduct, including Speak Up, anti-bribery, privacy, competition law,
security, and health and safety. This year, we shared a message
reminding everyone about our responsibility to act ethically through a
special message featuring our leadership members.
Training on our Code of Conduct is included in our standard induction
process for new employees. We expect every employee to complete
refresher training when assigned, and this is typically every two years.
Of those employees assigned induction or refresher DWR training during
the period, 93.6% had completed the training as of 31 March 20241.
To keep the knowledge of our Code of Conduct fresh, we launched
assessment tests this year across areas like the Code of Conduct,
anti-bribery, health and safety, privacy and security within selected
markets. The newly launched refreshers have helped us test and
refresh knowledge of key concepts. These tests have received a high
Net Promoter Score of 86-93%. Those who did not pass are required
to complete learning in the relevant subject area. These assessment
tests will also be launched across other markets in FY25.
This year our competition law learning module was also upgraded.
This course was assigned to select learners who are closest to competition
law risks. It had a completion rate of 88% as of 31 March 20241.
We also strive to make compliance easy for our employees and
continue to improve our digital Code of Conduct and global policy
portal, the internal platform where employees can find information
about our policies and procedures. A programme is underway to
streamline our policy environment and optimise the number of
policies so that we can effectively address our risk environment.
Our digital Code of Conduct and policy sites continue to be accessed
widely by users across the Group with over 200,000 visits to the policy
portal in the last quarter of FY241.
Our Code of Conduct is well understood throughout Vodafone. In the
April 24 Spirit Beat employee survey, 95% of respondents agreed with
the statement ‘Our team lives by the Code of Conduct’.
Speak Up
Everyone who works for or on behalf of Vodafone has a responsibility
to report any behaviour at work that may be unlawful or criminal, or
could amount to an abuse of our policies, systems or processes and,
therefore, be a breach of our Code of Conduct. Employees are able to
raise concerns with a line manager, with a colleague from human
resources or through our anonymous confidential third-party hotline,
Speak Up, which is accessible in local languages online or by telephone.
We have a non-retaliation policy when a genuine concern has been
reported. Everyone who raises a concern in good faith is treated fairly,
with no negative consequences for their employment with Vodafone,
regardless of the outcome of any subsequent investigation.
Speak Up reports are confidentially investigated by local specialist
teams, with a senior team in place to triage reports. Each grievance is
monitored to verify that any corrective action plan or remediation has
been conducted. Our Group Risk and Compliance Committee reviews
the effectiveness of the Speak Up process and trends once a year,
and the Audit and Risk Committee receives an annual update, with
additional ad hoc reviews carried out where appropriate.
Our employees trust our Speak Up process, as evidenced by our
April 24 Spirit Beat survey, with 87% of respondents agreeing that
they believe appropriate action would be taken as a result of using
the process. We also track the proportion of ‘named’ versus
‘anonymous’ reports as a higher number of named reports suggests
higher levels of trust in the Speak Up process. During the year,
52% (FY23: 58%) of reports were ‘named’ and this was higher than
available industry benchmarks.
This year, 6491 (FY23: 5051) separate concerns were reported using
Speak Up. These concerns could relate to matters of unlawful
behaviour or matters of integrity, such as bribery, fraud, price fixing, a
conflict of interest, or a breach of data privacy. Reports could also
relate to people issues such as discrimination, bullying or harassment,
danger to the health and safety of employees or the public, or
potential abuses of human rights.
If we decide to proceed with an investigation, a corporate security
investigator or member of HR will investigate, keeping the person
who raised the concern informed throughout the process. Where
reports made to Speak Up require remedial action, this could include
consequences at the individual level or changes to internal processes
and procedures.
Speak Up is owned by the Chief Human Resources Officer and
overseen by the Group Risk and Compliance Committee.
Speak Up is also made available to our suppliers and is communicated
through our Code of Ethical Purchasing. For suppliers that decide
to maintain their own grievance mechanisms, we require that they
inform us of any grievances raised relating to work done on behalf of
Vodafone directly.
Speak Up topics raised during the year
Topic1
Speak Up
reports
Requiring
remedial action
People issues2
77%
36%
Integrity
18%
51%
Other
3%
41%
Health and safety
2%
43%
Notes:
1. There were was one report relating to modern slavery concerns reported during the period
(FY23: zero reports).
2. Diversity and inclusion topics accounted for 2% of the People issues reported during the year.
Maintaining Trust
Purpose (continued)
Note:
1. Includes our discontinued operations in Italy and Spain.
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Privacy risks
As data volumes continue to grow and regulatory and customer
scrutiny increases, it is important to be clear on the privacy risks we
face, as well as how our policies and programmes can mitigate these.
We categorise data privacy risk into three main areas:
– Collection: collection of personal data without permissions, or
excessive collection of data;
– Access & use: use of personal data for unauthorised purposes,
excessive data retention or poor data quality; and
– Sharing: unauthorised disclosure of personal data, including
supplier non-compliance with the law or our own policies.
To help us identify and manage evolving risks, we constantly evaluate
our business strategy, new technologies, products and services, as
well as government policies and regulation.
Privacy principles
Our privacy programme governs how we collect, use and manage our
customers’ personal data to ensure we respect the confidentiality of
their communications and any choices that they have made regarding
the use of their data. Our privacy programme is based on the
following principles: accountability; fairness and lawfulness; choice
and access; security safeguards; privacy by design; openness and
honesty; responsible data management; and balance.
Click to read more about our privacy principles and how they guide the way our
products are designed and built: vodafone.com/privacy
Using customer data
We want to enable our customers to get the most out of our products
and services. To provide these services, we need to use our customers’
personal information. We aim to protect our customers’ data and only
to use it for a stated and specific purpose, and we are always open
about what customer data we collect, and why we collect it.
Click to read more about uses of customer data:
investors.vodafone.com/sasb
Each local market publishes a privacy statement to provide clear,
transparent and relevant information on how we collect and use personal
data, what choices are available regarding its use and how customers can
exercise their rights. Our product-specific privacy notices include details
relating to a particular product. These statements and notices are available
to customers online, in the MyVodafone app and in our retail stores.
We provide our customers with access to their data through online and
physical channels. These channels can be used to request deletion of data
that is no longer necessary, or for correcting outdated or incorrect data, or
for data portability.
Our customer privacy statements and other customer-facing
documents provide comprehensive information on how these rights
can be exercised and how to raise complaints or contact the relevant
data protection authority. Our frontline retail and customer support
staff are trained to respond to customer requests.
Our state-of-the-art, multi-channel permission management
approach has been deployed across our channels (MyVodafone app,
website, call centres and retail stores) since 2018. This approach
allows our customers to control how we use their data for marketing
and other purposes at any time and the permissions are synchronised
across our channels. For example, customers can:
– Opt-in for the processing of special categories of data;
– Choose what data we collect through the MyVodafone app and
how it is used;
– Opt-out from marketing across different channels (call, SMS,
notifications), or opt-in to the use of their communications
metadata for marketing purposes or for receiving third-party
marketing messages; and
– Opt-out from the use of anonymised network and location data
(‘Vodafone Analytics’).
Click to read more about our privacy policies:
vodafone.com/privacy
Operating model
We have an experienced team of privacy specialists dedicated to
ensuring compliance with data protection laws and our policies in the
countries where we operate.
We have a clear process for managing privacy risks across the data life cycle
and teams from across Vodafone ensure end-to-end coverage. Dedicated
security teams are tasked with applying appropriate technical and
organisational information security measures to protect personal data against
unauthorised access, disclosure, loss or use during transit and at rest.
Read more about cyber security
on pages 46 to 51
All products, services and processes are subject to privacy impact
assessments as part of their development and throughout their life
cycle. We maintain personal data processing records, supplier privacy
compliance, data breach management and individual rights
processes, as well as internal and international data transfer
compliance frameworks, and training and awareness programmes.
In our supply chain, privacy and security requirements form a key part
of our supplier management processes. All suppliers go through a
thorough onboarding process to verify their adherence to these
requirements, with appropriate data protection measures and
continuous monitoring agreed.
Our teams monitor and influence regulatory and industry
developments and work to build and maintain relationships with local
data protection authorities and other key stakeholders.
Our privacy control frameworks are subject to continuous risk-based
improvements. In addition to introducing updates to our global privacy
controls, we also require every employee, and where possible contractors,
to complete DWR privacy training within six weeks of joining. In addition,
they need to complete refresher courses in line with our annual learning
intervention cycle. We also have targeted training for high-risk teams
with a key role in personal data processing. With this approach we aim to
achieve a 90% completion rate on both types of training for all target
groups across our global footprint. In FY24, 94% of assigned
employees completed DWR or more specific privacy training.
The effectiveness of control implementation is subject to quarterly
reporting, and annual evidence-based testing by the privacy teams,
as well as internal audit. Control implementation is also reviewed by
local market CEOs, the Group Risk and Compliance Committee and
the Audit and Risk Committee. Any findings are subject to remedial
actions by the responsible control operator, and completion is monitored.
Customers
Responsible use of data
Millions of people communicate and share information over our
networks, enabling them to connect, innovate and prosper.
Customers trust us with their data and maintaining this trust is critical.
Data privacy
We believe that everyone has a right to privacy wherever they live in the
world, and our commitment to our customers’ privacy goes beyond
legal compliance. As a result, our privacy programme applies globally,
irrespective of whether there are local data protection or privacy laws.
Our privacy management policy is based on the European Union General
Data Protection Regulation (‘GDPR’) and this is applied across Vodafone
markets both inside and outside the European Economic Area. Our
privacy management policy establishes a framework within which local
data protection and privacy laws are respected and sets a baseline for
those markets where there are no equivalent legal requirements.
Click or scan to watch our privacy experts summarise our approach to
data privacy:
investors.vodafone.com/videos
Note:
1. Includes Vodafone Italy and Vodafone Spain.
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Purpose (continued)
Cyber security
Strategy
Our cyber security strategy
Our vision is a secure connected future for our customers and society.
We are motivated by a clear purpose to inspire customer trust and
loyalty through providing sustained cyber security, ultimately
contributing to a secure society and an inclusive future for all.
Our cyber security strategy and operating model support our vision
and goals, and form part of our wider Company strategy. Each year we
refresh our cyber security strategy and every five years redevelop the
cyber security strategy based on changes in the internal and external
environment.
Our strategy is based on core principles, including:
– Act as an enabler for the business;
– Be proactive, risk and threat-led, supported by data-driven
decisions, automation and digitalisation;
– Build and assure security in all products and services; and
– Simplify architecture though partnership with key suppliers.
To implement these principles, our strategy is delivered through six
pillars of change:
Control evolution: Maintain and improve our security controls and
procedures beyond the existing cyber security baseline with an
adaptive and risk-based framework;
Secure by design: All products and services have security built in,
whether we build them ourselves or buy them from vendors;
Dynamic trust: Strong zero-trust security based on dynamic
risk-based access that is frictionless for users: for example, multi-
factor authentication and moving away from passwords;
Real-time data and real-time response: The next generation of our
detection and response capability, more automated and based on
advanced analytics;
Spirit of Vodafone and cyber culture: Engaging our people, nurturing
our engineering community and Group-wide cyber security training
and simulations; and
Security for society: Collaborate widely to encourage standardisation,
share intelligence, and engage on regulation.
Each year we define and communicate priorities for a three-year
period, so all areas of our business are clear on the investment
priorities for security. We track progress against these priorities
throughout the year.
Year ahead
The priorities for the coming year include updating and redeveloping
our cyber security strategy in line with future technology changes
and expected threats. This strategy will position us to manage
changes in technology, threats and the external environment.
Key priorities for the year include:
– Design and development of a new security operations platform;
– Further strengthening of identity, access control and
authentication;
– End-to-end security of our telecommunications networks,
transforming how we manage the security of our third parties; and
– New adaptive cyber risk methodology.
Alongside these priorities, we continue to focus on security control
improvement, efficiency and automation, including automation of key risk
indicators that provide data driven measurement of our security position.
Click or scan to watch our cyber
security experts summarise
our approach to cyber security:
investors.vodafone.com/videos
Click to read our cyber
security factsheet:
investors.vodafone.com/
cyber
Governance
The General Counsel and Company Secretary, a member of the
Executive Committee, oversees the global privacy programme. The
Group Privacy Officer, reporting to the General Counsel, is responsible
for managing and overseeing the privacy programme on a day-to-day
basis across the markets and provides regular status reports to the
General Counsel and Company Secretary and an annual update to the
Audit and Risk Committee. During the year, the Group Chief Executive
conducted regular compliance reviews, to seek to ensure operating
companies were adhering to the Group’s policies and procedures. This
included oversight of our privacy programme.
Whilst each employee is responsible for protecting personal data they
are trusted with, accountability for compliance sits with each
operating company. A member of the local executive committee
oversees the local implementation of our privacy programme. Each
operating company also has a dedicated privacy officer, privacy legal
counsel and other privacy specialists. Local privacy officers report to
the Group Privacy Officer throughout the year.
The privacy leadership team approves new standards and guidelines and
monitors the implementation of global privacy plans. Operating companies
also maintain privacy steering committees that bring together privacy and
security teams and senior management from relevant business functions.
Privacy incidents
We have a strong culture of data privacy and our assurance and
monitoring activities are designed to identify potential issues before
they materialise. However, during the financial year, excluding Italy
and Spain, Vodafone was fined €42,000 (FY23: €65,000) for separate
data privacy issues, primarily relating to marketing without consent,
human and system errors in data processing, and delayed execution
of data subject rights. In response, we have introduced new standards
and increased monitoring.
Read more about how we respond to a data breach
on pages 46 to 51
Vodafone’s approach to responsible artificial intelligence (‘AI’)
Vodafone’s AI governance approach demonstrates our desire to
engage with AI in an ethical and responsible manner for the
benefit of customers, employees, and society. We first released
our ethical AI framework in 2019. We have further formalised our
governance of AI. The AI Governance Board is a senior steering
group that defines strategy and policy for AI and monitors its
execution. The board is chaired by the Vodafone Chief Commercial
Officer, and is attended by the CEO of Vodafone Business, Chief
Technology Officer, Chief HR Officer and Chief Legal Officer.
The AI Governance Board is supported by the following functions:
the Global AI Data and Analytics function leads the deployment of
the AI initiatives. The AI innovation team drives AI innovation. HR is
responsible for upskilling our workforce, and the Responsible AI
Office ensures compliance and ethical use of AI, together with our
Secure and Privacy by Design and External Affairs teams.
Case study: De-risking personal data with synthetic data
Privacy enhancing technologies (‘PET’s) reduce the risks
associated with personal data. PETs are part of Vodafone’s privacy
risk management approach. Vodafone has been experimenting
with synthetic data recently. Synthetic data is data that is
artificially created instead of collected from real-world events, it is
produced by algorithms and is used, for example, to replace test
data sets of production or operational data, test mathematical
models, train machine learning models, or run different analytics
use cases. Synthetic data is not personal data, but it maintains the
statistical features of the original data. This means it can be used
for many use cases without regulatory obstacles.
Click to read more about our approach to artificial intelligence
vodafone.com/privacy
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New technologies and industry collaboration
We adopt new technologies to better serve our customers and gain
operational efficiency. For every technology programme, new or
existing, we follow our Secure by Design process, evaluating suppliers’
hardware and software, modelling threats and understanding the risks
before designing, implementing and testing the necessary security
controls and procedures.
Mobile networks
Every new mobile network generation has brought increased
performance and capability, along with new opportunities in security.
As we deploy 5G core networks alongside our 5G radio networks,
often described as 5G Standalone, we have updated our security
standards to implement the latest 5G features in our core networks.
We also test security in our radio networks using independent
third-party testing companies.
OpenRAN is a new way of building and managing radio access
network (‘RAN’) components within telecommunication
infrastructure. Instead of purchasing all the components from one
supplier, we use hardware and software components from multiple
vendors and integrate these via open interfaces. Over time, this will
create a more competitive landscape for telecommunications
equipment. We continue to collaborate with other players in the
OpenRAN ecosystem to improve security. This includes adding
requirements to the OpenRAN specification, publishing internal
security standards, and benchmarking vendors against these. The first
OpenRAN sites are now live in the UK, Romania and DRC.
Quantum computing
We are preparing for a time when quantum computing is available at
scale. Through our joint research with IBM, we have developed a
risk-based approach to mitigate the risks of existing cryptography,
which could be more easily broken by a quantum computer. We are
identifying potential quantum vulnerabilities, defining supplier
requirements and developing the ability to update our cryptography
when new threats emerge. Vodafone also co-chairs the
telecommunications industry-wide task force on this issue.
Artificial intelligence (‘AI’)
We take the responsible use of AI seriously and seek to balance the
opportunities and risks associated with AI, and more recently
generative AI (‘Gen AI’). Teams from across the business are
collaborating under the governance of a global AI governance board
which agrees policy, mitigates threats, identifies and selects use cases
for implementation.
Read more about AI governance
on page 46
We are experimenting with public and private Large Language Models
(‘LLMs’) to support a range of potential business cases. To date, two
private versions of models have been reviewed and approved though
our Secure by Design process. To reduce the risks of misuse, we limit
access to specific public LLMs. We have developed an awareness
programme and updated our guidance and policies to make it clear to
our employees what data must not be shared in a public AI model.
We have defined requirements for internal LLM application
development including risk assessment, designing for transparency,
lack of bias and providing the right degree of human oversight of
results. If the AI model could have a high impact on people, we
require a human to have input on the final decision.
We are also investigating the use of AI to augment our cyber security
processes. The first proof of concept is a cyber security chatbot which
can answer employee questions on cyber policies and standards. We
are also part of cross-industry forums which collaborate on
telcommunication-specific AI use cases, including threat detection,
investigation and response.
Industry collaboration
We actively engage with stakeholders across industry, with regulators,
standard-setting bodies and governments. Collaboration is vital to
respond to threats, protect our organisation and workforce, and build
safe online and digital spaces for customers and society. We use our
expertise and experience to engage with a wide range of organisations
to help improve the understanding of cyber security thinking and
practice, and contribute to public policy, technical standards,
information sharing, risk assessment, and governance. For example,
we have engaged in cross-industry collaboration through the
European Round Table, where we chair the CISO committee. We have
an appointed member on the National Cyber Advisory Board in the
UK. We also collaborate with other telecommunication companies,
and actively engage in security standards working groups such as
ENISA 5G Cyber Security Certification, O-RAN Alliance Security Focus
Group and GSMA Fraud and Security Group.
Risk management
Identification of vulnerabilities and risks
Cyber attacks are part of the technology landscape today and will be
in the future. All organisations, governments and people will be subject
to cyber attacks and some will be successful, leading to security incidents.
The telecommunications industry is faced with a unique set of risks as we
provide connectivity services and handle private communication data.
As a result, cyber security is one of Vodafone’s principal risks. A
successful cyber attack could cause serious harm to the Company or its
customers, including unavailability of services or a data breach leading
to disclosure or misuse of customer personal data. The consequences
could include, but are not limited to, exposure to contractual liability,
litigation, regulatory action, or damage to the company’s reputation and
brand and loss of market share. In the worst case, the cyber security
incident could cause material financial impact to the Company.
There is increasing regulatory focus on cyber security and requirements
for telecommunications providers to improve their cyber security
practices. The Company is subject to GDPR and equivalent legislation
in many countries in which it operates. In addition, there are cyber
focused local laws and regulations, for example in the UK with the
Telecoms Security Act. A cyber incident may therefore lead to
regulatory fines and other enforcement activities if deemed to be due
to inadequate security. Measures to meet these laws and regulations
will also result in increased compliance costs.
We dedicate significant resources to reducing cyber security risks,
however due to the nature of the threats, we cannot provide absolute
security and some cyber security incidents will occur.
Risk and threat management are fundamental to maintaining the
security of our services across every aspect of our business. We
separate cyber security risk into three main areas of risk:
– External: A wide variety of attackers, including criminals and state-
backed groups, target our networks, systems and people using a range
of techniques and procedures. They seek to gain unauthorised access to
steal or manipulate data or disrupt our services. Geopolitical factors also
increase the threat of an external attack;
– Insider: Our employees may accidentally leak information or
maliciously misuse their privileges to steal confidential data or to
cause disruption; and
– Supply chain: We only have indirect control over the cyber security
of third-party service providers, limiting our ability to defend against
cyber threats to these third parties. Such attacks, if successful, could
cause services to be unavailable or enable a data breach to occur.
To help us identify and manage emerging and evolving risks, we
constantly evaluate and challenge our business strategy, new
technologies, government policies and regulation, and cyber threats.
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We conduct regular reviews of the most significant security risks
affecting our business and develop strategies and policies to detect,
prevent and respond to them. Our cyber security strategy focuses on
minimising the risk of cyber incidents that affect our networks and
services. When incidents do occur, we identify the root causes and
use them to improve our controls and procedures.
Cyber security risk is aligned with Vodafone’s enterprise risk framework.
Each principal risk owner is responsible to produce a formal Line of
Sight document twice a year that describes the risk, the Company’s
risk tolerance, current position, control position and actions to move
to tolerance if required. Second and third line assurance supporting
the report is also included in the Line of Sight document.
Risk and control approach
The global Cyber and Information Security policy applies to all
Vodafone-controlled entities. Each security domain has a more
detailed supporting policy document with detailed control objectives.
The policies are underpinned by security standards which provide
relevant technical specifications.
Control framework
Security controls and procedures define the requirements which allow our
policies to be met. These controls and procedures are designed to prevent,
detect or respond to threats. Most risks and threats are prevented from
occurring and we expect most will be detected before they cause harm and
need a response.
We have defined a common global control framework called the Cyber
Security Baseline (‘CSB’) and adoption is mandatory across the entire Group.
We based the CSB on the ISO 27001 international standard, mapping those
controls to our cyber risks to identify the most impactful. Our original
baseline included 48 key controls, this has grown to 56 as we have
reviewed and identified new controls to counter new cyber threats.
All controls in the baseline need to be effective in all entities. We define
effectiveness based on the depth of the control implementation and
coverage of the relevant assets. We understand that cyber security controls
need to be continuously evolved and enhanced to mitigate risks and threats.
Each year we set new annual targets, and progress against the targets is
monitored and reported to the senior leadership team in each market and
the technology leadership team quarterly. We update our priorities with
changes, including any necessary new controls and procedures.
In addition to this top-down process of risk identification and mitigation, we
identify individual cyber risks at the product or system level, for example
through our Secure by Design process, operational activities, scanning and
monitoring, or through an incident. Risks are evaluated on a common
impact and likelihood scale, mitigating actions are agreed and captured in a
risk register. Any high risks identified through these processes require senior
management oversight and agreement of mitigating actions.
Adaptive risk and control methodology
A risk and control methodology is important to drive action in any
company. We are launching a new global methodology for cyber security
risk management, which was developed with the assistance of a major
consulting firms. During FY25 we will retire the CSB and replace it with the
new methodology. This methodology has a greater focus on risk and
threats but retains the structured control framework and common targets
of CSB. Controls are vital to reduce risk and initially we will continue to use
the same control set under the new methodology. To adapt to the
changing threat landscape, the new methodology introduces threat and
risk scenarios. The threats and specific attack techniques are mapped to the
controls that most significantly reduce risk, allowing gaps to be highlighted.
The control framework will continue to evolve based on technology
changes, our strategic and business priorities, and changing regulation.
Over the next three years, we intend to automate the capture and reporting
of key risk indicator data from source systems. This will reduce manual
effort, be more accurate and provide stronger assurance of effectiveness.
Further, to better quantify residual risk, we have also created a risk
quantification model based on threats, control effectiveness and incident
data. This will be tested and launched during FY25.
Assurance
A dedicated technology assurance team review and validate the
effectiveness of our cyber security controls and procedures, and our
control environment is subject to regular internal audit. We test the
security of our mobile networks every year using a specialist testing
company, they also benchmark our security against other
telecommunications operators. This provides assurance that we are
maintaining the highest standards and our telecommunications
controls are operating effectively. We have also appointed external
specialists to perform testing on our security controls (‘red teaming’)
to uncover any areas for improvement. We maintain externally audited
information security certifications, including ISO 27001, which cover
our global technology function and 11 local markets. In addition, our
markets comply with national information security requirements where
applicable. All systems going live and those undergoing change are
independently penetration tested. An internal team performs some
testing, and we engage third party testers where appropriate. Across
Vodafone, we complete over 1,0001 penetration tests every year. We
also perform adversary testing exercises using independent third parties.
Supply chain
As well as monitoring control effectiveness within Vodafone, we oversee
the cyber security of our suppliers and third parties. Controls and
procedures are embedded in the supplier lifecycle to set requirements,
assess the risk and monitor each supplier’s security performance.
At supplier onboarding, minimum security requirements are written into
contracts, and we determine the inherent risk of the supplier based on the
service they are providing. We then assess their controls and procedures
using a questionnaire to understand the residual risk, which informs the
frequency of review from annual to every three years. We follow up on
open actions and ensure any security incidents are tracked and managed.
Regulatory landscape
We expect a continued increase in security regulation over the next few
years as governments respond to the heightened cyber threat landscape,
recognising that telecommunications operators provide critical national
infrastructure. We engage directly with governments and industry partners
to promote proportionate, risk-based and cost-effective solutions to security
threats. We look to establish shared approaches to reinforce standardisation
and regulatory frameworks that apply equally to all market participants.
In the UK, we are implementing the provisions of the
Telecommunications Security Act which sets enhanced security
requirements for UK network operators and their suppliers. In Europe,
individual member states have their own current or pending legislation,
which incorporate EU-wide standards such as the 5G Security toolbox
and the Network and Information Security 2 Directive. We continue to
monitor the forthcoming EU Cyber Resilience Act which aims to
ensure that all digital products and services fulfil the same security
requirements.
The US Securities and Exchange Commission (‘SEC’) introduced new cyber
security incident disclosure and periodic reporting requirements in
December 2023. We have updated our incident management process to
include the relevant disclosure steps should a material incident occur; this is
described in the Cyber Operations and Incidents section. Where applicable
we have expanded these cyber security disclosures in response to the new
reporting requirements.
Operating model
Our approach to cyber security
We have implemented a globally consistent cyber security operating
model that is based on the leading industry security standards published
by the US National Institute of Standards and Technology (‘NIST’). The
model is designed to reduce risk by constantly identifying threats,
protecting, defending and improving our security. We operate cyber
capabilities with an in-house international team of over 9001
employees.
Purpose (continued)
Note:
1. Includes Vodafone Italy and Vodafone Spain.
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We augment our internal capabilities where necessary with third-party
specialist technical expertise, such as digital forensics, red teaming
and penetration testing. We use specialist resources to perform testing
of our telecommunications networks. We also use qualified external
resources to help during the implementation of change and improvement
projects. Our scale means we benefit from global collaboration, technology
sharing and deep expertise, and ultimately have greater visibility of emerging
threats. An example would be our global security operations centre which
takes inputs and telemetry from all the markets where we operate.
Cyber security function
Team
Responsibilities
Governance,
Risk and
Control:
– Cyber risk framework and management across
the Group.
– Define and track adoption of controls and
procedures, and measure effectiveness.
– Identify and reduce supplier cyber risk
Strategy and
Secure by
Design:
– Define cyber strategy aligned to technology and
Company strategies.
– Products, services and internal systems are
secure by design.
Cyber Prevent:
– Engineer, deliver and operate global security
platforms, driving continuous improvement
Cyber Defence:
– Perform threat intelligence & security testing. Detect
events and attacks through 24/7 monitoring.
– Respond to events and incidents to minimise the
impact to business and customers.
Local Market
Teams:
– Responsible for managing and embedding cyber
security in our local markets, including meeting
local cyber regulatory and compliance requirements.
Our approach to cyber security is summarised in the following diagram and
the accompanying video linked below. In the video, cyber security experts
from across teams in the cyber security function explain our approach
across the lifecycle: identify, protect, detect, respond, recover and govern.
Scan or click to watch our cyber security experts
summarise our approach to cyber security:
investors.vodafone.com/videos
The Chief Technology Officer has been at Vodafone since 2009.
During that time he has held positions in Vodafone Business Product
Management and Technology, has been UK CTO and since 2021 the
Chief Digital & Information Officer leading an integrated Europe-wide
technology team.
Within the cyber security organisation, led by the CTAS Director, we have
heads of global cyber security functions, local markets and regional cyber
security leaders. This global leadership team is responsible for directing,
managing and reducing cyber risk across Vodafone. Market and regional
cyber security leaders are also part of their local management teams, with a
dotted matrix reporting line to local chief information officers.
The CTAS Director has led cyber security in Vodafone since 2015. Prior
to joining Vodafone, the CTAS Director was chief security officer at a
large UK bank, after previously holding security and technology audit
leadership roles in financial services and the UK postal service. The
CTAS Director is an independent advisor for a large UK retail company,
a member of the UK Cabinet Office National Cyber Advisory Board and
holds several other industry advisory and committee roles. Our broader
cyber leadership team has significant cyber security and technology
risk experience across business sectors including telecommunications,
financial services and professional services.
The cyber security leadership team reviews detailed metrics monthly
covering security controls status, updates about the threat landscape,
and specific key risk indicators (‘KRIs’) for our most important controls.
Examples of KRIs include results of independent network testing by
third parties, vulnerability management, patching, hardening and
endpoint security status, and incident metrics. Internal reporting
provides a detailed view of progress and risk reduction. If markets are
consistently not achieving targets, they are expected to have plans in
place to recover.
Quarterly summary management reporting is provided to the technology
leadership team and Executive Committee. This is supplemented by
monthly control status reports which track targets and are discussed in
regular meetings with local market leadership teams.
The top level Cyber and Information Security policy is approved
annually by the CTO. To provide functional governance, we have a
quarterly Cyber Risk Council meeting, chaired by the Head of Cyber
Governance Risk and Control, and attended by the CTAS Director, the
CTAS leadership team and cyber security leaders from each market.
The meeting reviews and approves detailed cyber policies and standards,
monitors cyber risk and threat, and oversees key strategic programmes.
Cyber security risk is also reported to and monitored by more senior
committees including the Technology and Audit and Risk Committee,
chaired by Internal Audit and the Vodafone Group Risk and Compliance
committee, chaired by the Chief Financial Officer (‘CFO’). The CTAS
Director attends both of those committees to provide updates as required.
Board
The Board Audit and Risk Committee (‘ARC’) is the responsible committee
for the oversight of risks from cyber security threats. The Committee
receives updates from Internal Audit throughout the year. The Line of Sight
report documents the risk tolerance, risk position and mitigating actions for
each principal risk of the company, including cyber threat. This is presented
and reviewed annually.
In addition, the Committee reviews cyber risk based on a paper and
presentation from the CTO and CTAS Director. The report collates the data
that covers all local markets’ security status. The paper also typically
includes threat landscape, incidents, security position, residual risk, strategy
and programme progress across the Company. The most recent update
was provided in March 2024.
The Chair of the Board’s Audit and Risk Committee is the Senior Independent
Director of the Board. A former CEO at a UK financial services company,
he has significant experience of overseeing technology and cyber issues.
Cyber Security, Technology Assurance
and Strategy Director
Local
Markets
Germany
Africa
UK
Other
Europe
Central
Functions
Strategy & Secure by
Design
Cyber Prevent
Cyber Defence
Second Line of
Defence
Cyber Governance, Risk
& Control
Technology Assurance
Chief Technology Officer
Governance
Management
The Chief Technology Officer (‘CTO’) and Chief Network Officer are the
Executive Committee members accountable for managing the risks
associated with cyber threats and information security. The Cyber
Security, Technology Assurance and Technology Strategy (‘CTAS’)
Director is responsible for managing and overseeing cyber security
across Vodafone and reports to the Chief Technology Officer.
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Purpose (continued)
During the year, the Board formed a Technology Committee which
assists the Board by overseeing how technology underpins company
strategy. Cyber security was discussed in the first meeting of the
Committee, covering the changing business, technology and cyber
threat landscape.
The Cyber Code
The Vodafone Cyber Code has been designed to simplify and explain
basic security controls and procedures to all employees. The Cyber
Code is embedded in our Code of Conduct and is the cornerstone of
how we expect all employees to behave when it comes to best
practice in cyber security. It consists of seven areas where employees
must follow good security practice.
Click to read more about Vodafone’s Cyber Code in our Code of Conduct:
vodafone.com/code-of-conduct
Threats and incidents
Threat landscape and intelligence
An important part of our operating model is to gather intelligence and
insights about threats. The cyber threat landscape continues to be
volatile across all sectors, with wide-ranging threat actors. Our cyber
security team use industry and external analysis to help shape our
controls and procedures, and drive actions. When specific vendor or
new high impact vulnerabilities are reported, we drive global
remediation across Vodafone.
Geopolitical instability, conflict and tensions often lead to an increase
in cyber threats from state-backed and criminal threat actors. This can
lead to disruption, data theft and integrity compromise. Cross-industry
and government collaboration is vital.
Ransomware and data extortion attacks are common to companies of
all sizes. The threat is increasing. Based on public reporting, some
companies are paying ransoms, aggravating the threat.
Attackers are increasingly trying to log in, rather than hack in. As such,
social engineering methods are a common means for attackers to
gain access. Emerging technologies such as AI will enhance
techniques such as voice phishing and deep fakes. Harvested
credentials continue to be sought and shared by threat actors.
Attackers can target executives following media announcements and
public reporting.
The speed of vulnerability exploitation is very fast, with a trend for
targeting internet-facing software.
In 2023, the European Commission highlighted the number of supply
chain attacks in Europe has tripled. Supplier attacks against all sectors
are likely to increase in the coming year.
We anticipate threats will continue from existing sources, as well as
evolving in new technology areas such as AI and quantum computing.
Cyber operations and incidents
As a global connectivity provider, we see a range of cyber threats. We
use our layers of controls to identify, block and mitigate threats and
reduce business or customer impact. Our global security operations
capability handles trillions of events and logs from sensors across our
footprint, detecting potential threats and events. Low severity issues
are dealt with quickly, for example by malware containment or
isolating an individual device. More significant events are triaged to
our 24/7 incident management and response team. We operate a
single global team and capability.
Where a security incident occurs, we have a consistent incident
management framework to manage our response and recovery.
The focus of our incident responders is always fast risk mitigation and
customer security.
In the event of a cyber breach, disclosure is made to the relevant
authorities in line with local and global regulations and laws and a risk
assessment considering the impact on customers. This may include
law enforcement as well as regulators. The European Union’s GDPR
provides a framework for notifying customers in the event there is a
loss of customer data because of a data breach, and this framework is
a baseline across all our markets. Our data privacy officers are a key
part of the response where incidents impact personal data. We will
also notify the SEC if an incident is deemed material.
Click or scan to watch the Chair of
the Technology Committee talk
more about his role
Read more about the Audit
and Risk Committee’s
oversight of cyber security
on pages 89 to 94
Culture, training and awareness
Training and awareness
Our cyber security awareness approach is to educate our employees
to protect themselves and our customers from cyber threats. Cyber
security training is mandatory as part of our Doing What’s Right
programme. The training module is designed by the cyber security
team to inform employees of key threats and how to avoid them. The
cyber leadership team are actively involved in shaping the approach
and in specific employee communication. The corporate security
function lead on all employee security training and they deliver the
programme and materials. Mandatory training runs every other year
with a short refresher and knowledge check in the intermediate year.
If the knowledge check is failed, the employees are required to retake
the full cyber security training module. During the year we launched a
training manual for contractors, so they also receive the same level of
awareness. Training on cyber security is also included in our induction
process for new employees. We track completion rates to ensure
every employee completes mandatory training when assigned.
Read more about our approach to mandatory
Doing What’s Right training on page 44
Cyber security training is reinforced by regular digital communications
delivered via our internal social media platform, through videos and
webinars. We respond to threats with specific targeted advice, such as the
use of multi-factor authentication and reminders to not share credentials.
We perform phishing simulations across all markets and functions to raise
awareness and train employees. We target at least two exercises per market
or function per year. We also run multi-market simulations to allow us to
compare responses consistently – in the most recent exercise we sent over
100,0001 emails to nine1 European markets and Group functions. Those
who click on the link in the phishing message or share their credentials
receive immediate training. We are now rolling out this multi-market
approach to our African markets.
We also provided focused training for our Executive Committee. This year,
we covered social engineering threats, use of social media, travel to
high-risk countries, using devices securely and how to share confidential
information safely. The training materials were cascaded to their teams by
ExCo members.
We have continued to undertake incident simulations for local
executive committees, most recently for Greece. The simulations
provide CEOs and their teams a realistic and tailored experience of
managing a cyber incident and exercising their responsibilities in
accordance with our common approach.
Growing our skills
We enable employees in our cyber teams to maintain and grow their skills
to better protect our customers. Our company learning platform hosts
cyber training on technical topics, platforms and frameworks. Employees
can study towards recognised information security and cyber certifications
aligned to their learning plans.
Since 2020 we have organised twice yearly cyber connect events for our
entire global cyber security team. The events include a recap of our strategy
and achievements, messages from senior leadership, external industry
speakers, collaborative breakout groups and technical track sessions to
learn about cyber topics and best practice. We use technology to enable a
hybrid experience with some attending in offices and some remote.
Note:
1. Includes Vodafone Italy and Vodafone Spain.
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We classify security incidents on a scale according to severity,
measured by potential business and customer impact. The highest
severity category of event is called Severity 0 down to the lowest
Severity 4. Severity 0 corresponds to a significant data breach or loss
of service caused by the incident. If a Severity 0 incident occurs, we
notify the Executive Committee, the Board and external auditors and
provide regular updates. A crisis group is formed composed of
relevant senior management who oversee the response.
SEC requirements have been incorporated into our incident
management process. In the event of a Severity 0 incident, the
Disclosure Committee (composed of the CFO and General Counsel)
would decide if a UK market disclosure is necessary for materiality
reasons, that would also trigger disclosure to the SEC.
In the past two financial years, no incidents have been Severity 0. In FY22
we experienced one Severity 0 in Vodafone Portugal in February 2022
and in FY21 we experienced one Severity 0 incident at Italy Ho. Mobile in
December 2020. Details of these two previous disclosures are in our FY23
Cyber Security Factsheet. These incidents did not have a material impact
on the Company’s business strategy, results of operations or financial
condition.
Whilst overall incident volumes have remained stable, a higher
proportion of these are at suppliers and third parties. In FY24, 55% of
severity 1 and 2 incidents were related to our suppliers and third parties
(FY23; 47%). We contractually require our suppliers to report incidents
and we track and manage the incidents using the same framework as
we do for internal events. In two cases in this financial year, our team
helped a supplier recover services after a ransomware attack. Neither of
these incidents were material to Vodafone’s business strategy, results
of operations or financial condition.
When incidents are closed, we complete a post-incident review to
learn the lessons from the incident, including the root cause and any
improvements needed.
Cyber insurance is an important part of our risk management and
mitigation approach. Vodafone holds cyber liability insurance
alongside business interruption and professional indemnity policies.
Should a serious cyber event occur, we could recover the costs in
whole or in part through these policies.
Click to read more about how we manage risks from technology disruptions
in our SASB disclosure: investors.vodafone.com/sasb
Society
Protecting people
Wherever we operate, we have an opportunity to
contribute to the advancement of fundamental
rights for our customers, colleagues and communities.
We are also conscious of the risks associated with
our operations, and we work hard to mitigate
negative impacts, ensuring we keep people safe.
Mobiles, masts and health
The health and safety of our customers and the wider public has
always been, and continues to be, a priority for us. Our masts fully
comply with national regulations, which are typically based on, or go
beyond, international guidelines set by the independent scientific
body, the International Commission for Non-Ionizing Radiation
Protection (‘ICNIRP’). There has been scientific research on mobile
frequencies for decades, including those used by 5G. If exposure is
within national regulations, the scientific consensus is that there is no
adverse impact on health. We continually monitor and evaluate our
mobile networks to make sure we meet all regulations. In addition, all
the products we sell are rigorously evaluated to ensure they comply
with international safety guidelines.
As well as complying with national regulations, markets that have
rolled out 5G apply the Smart PowerLock (‘SPL’) feature. This
technology, designed for use with the adaptive antennas used for 5G,
continuously monitors the transmitted radio frequency power of the
antenna to ensure it is always below a threshold when averaged
over a predefined time window. This takes into account compliance
with electromagnetic field (‘EMF’) regulations under all possible
operating conditions for 5G sites. This is now one of many software
features that are routinely active on 5G sites. SPL also includes
statistics that can be used to build evidence of compliance over
several weeks for a given site if needed by regulators. National
regulators have accepted the feature as effective.
Science monitoring
Scientific reviews have made a vital contribution to establishing
industry guidelines and standards. We follow the results of these
independent expert reviews to understand developments in scientific
research related to mobile devices, base stations and health.
We continue to fund research into mobile devices, base stations and
health through funding bodies such as national governments to
ensure that the research remains independent of industry influence,
including our own. We also respond to requests from bodies
conducting research by providing technical advice and information on
the use of mobile devices. This helps to ensure scientists have access
to the best-quality information available.
Harmonisation with international science-based guidelines
Following the publication in 2020 of updated international guidelines on
electromagnetic frequencies, we have supported and promoted the
transition from the previous guidelines from 1998 to this more up-to-date
and appropriate set. In EU Member States, the EMF regulations are set
nationally with most being aligned with the ICNIRP guidelines. In the last
year, in the city of Brussels, conditions have been changed to allow for the
rollout of 5G services.
Click to read more about ICNIRP 2020:
icnirp.org
Operating model
We have robust governance mechanisms in place and conduct
regular compliance assessments to ensure that our products meet
the standards set by the Group policy and national regulations.
The Group EMF leadership team meets through the year and
reports to the Executive Committee and the Board.
We conduct network measurements and calculations of EMF
exposure from network masts and review the test reports we receive
on EMF testing on devices.
Human rights
We want to make sure that we have a positive impact on people and
society, which includes respecting human rights in all our operations.
We are a long-standing member of the UN Global Compact and our
approach is guided by the United Nations Guiding Principles on
Business and Human Rights (UNGPs).
Click to read more about our human rights approach:
vodafone.com/human-rights
Our Human Rights Policy Statement details how we do this and is
backed up by our internal Human Rights Policy, which sets out how
our people must ensure we respect human rights, including steps to
take through our other aligned policies, such as those covering
artificial intelligence, ethical purchasing, responsible minerals, health
and safety, human resources, privacy, business resilience and law
enforcement assistance.
Click to read our Human Rights Policy Statement:
vodafone.com/human-rights-policy-statement
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Purpose (continued)
Human rights risks
As a global telecommunications operator, we connect people.
This means that globally our most significant human rights risks relate
to our customers’ rights to privacy, concerning their data that we
safeguard, and freedom of expression, in terms of their ability to receive,
seek and share information, through the connections we provide. Local
laws and regulations can mandate that telecommunications operators
must assist governments, and we must comply with lawful government
requests as part of our operating licences. This might include the
disclosure of customer information or limiting access to digital networks
and services. However, our internal law enforcement assistance policy
guides us on how to do this in a rights-respecting way, and our
transparency reporting provides data on certain requests we receive.
Click to read more about how we handle law enforcement demands:
vodafone.com/handling-law-enforcement-demands
The risks to people working throughout our supply chain are another area
of focus for us. We manage these risks through our responsible supply
chain programme, which assesses our suppliers for indicators such as
forced labour and other risks to human rights, such as health and safety. As
members of the Joint Alliance for CSR (‘JAC’), we benefit from JAC-led
on-site supplier audits and sharing of best practices with other
telecommunications operators to enhance our supply chain management.
We believe in supporting the responsible sourcing of minerals globally.
Although we do not source minerals ourselves, we follow the best practice
of the OECD Due Diligence Guidance to understand whether our
manufactured products include minerals that have been sourced from
smelters taking a responsible approach to sourcing.
Our human rights programme also addresses a broader range of
human rights risks, such as those relating to the design and
deployment of artificial intelligence, children’s rights, data ethics and
risks we may become connected with through our broader value
chain, such as enterprise customers or partner markets.
Our approach
We conduct due diligence in line with our internal policies to proactively
identify and address potential negative human rights impacts. Due
diligence comes in various forms and at different moments in our
operations: it may be an independent human rights risk assessment
for a new market entry, the ongoing assessments we do when considering
new partner markets, roaming partnerships, the deployment of artificial
intelligence or the development of new products and services.
We follow up assessments of actual or potential material negative human
rights impacts with what we consider to be appropriate mitigating actions,
such as contractual commitments to respect human rights in our partner
market agreements and in our enterprise customer contracts.
We maintain a grievance mechanism ‘Speak Up’ accessible to all
individuals in our workforce or supply chain, providing a platform to
raise concerns about human rights issues.
strong support for a culture of respect for human rights while
identifying actionable improvements, such as consolidating and
simplifying our policy architecture and accountability structure and
building and empowering our Human Rights Champions network. In
FY24, we have updated our Human Rights policy and relaunched our
Human Rights Champions network. In FY25, we will conduct a review
of our Human Rights Advisory Group’s terms of reference and
membership structure with the aim to report on our progress.
Collaboration
We play our part in developing the global understanding of what
businesses should do to respect human rights. We were placed
second in the Ranking Digital Rights 2022 Telco Giants Scorecard,
maintaining our position from the 2020 Index. We are a member of
initiatives such as the GSMA Mobile Alliance to combat Digital Child
Sexual Exploitation and the United Nations B-Tech Project, which
convenes business, civil society and government to advance
implementation of the UN Guiding Principles in the tech sector. This
year, as part of the Human Rights 75 Initiative, we joined with other
B-Tech Community of Practice members to make a public pledge to
continue engaging with other companies to share experiences of
implementing our respect for human rights commitments.
Responsible supply chain
We spend approximately €19 billion a year with 8,000 direct suppliers
around the world1 to meet our businesses’ and customers’
needs across network infrastructure, IT and services related to fixed
lines, mobile masts and data centres that run our networks.
The majority of our external spend is managed by our Vodafone
Procurement Company (‘VPC’) based in Luxembourg, and our shared
services organisation (‘_VOIS’) based in Ahmedabad, India. A large
area of spend is on the products we sell to our customers, including
mobile phones, smartwatches, tablets, SIM cards, broadband routers,
TV set-top boxes and Internet of Things devices. This centralised
approach helps to ensure that we maintain a consistent approach to
supplier management across Vodafone, from onboarding and vetting
a supplier to raising orders and paying for delivered goods and services.
Supply chain risks
We work with other operators collaboratively on supply chain risks
within the Joint Alliance for CSR (‘JAC’). We currently chair the
association of telecommunications operators established to improve
ethical, labour and environmental standards in the technology supply
chain. We are engaged in workstreams to make progress towards
reducing Scope 3 GHG emissions.
JAC reports on progress with respect to third-party factory audits of
common suppliers carried out on behalf of all its members in its own
reporting. Please refer to their website for details.
Click to read more about the Joint Alliance for CSR:
jac-initiative.com
Policy
This year we updated our Code of Ethical Purchasing which every
supplier that works for Vodafone is required to comply with. These
commitments extend down through the supply chain so that a supplier
with which we have a direct contractual relationship (Tier 1 supplier) in
turn is required to ensure compliance across its own direct supply chain
(Tier 2 supplier from Vodafone’s perspective) and beyond. The Code of
Ethical Purchasing is based on international standards, including the
Universal Declaration of Human Rights and the International Labour
Organization’s Fundamental Conventions on Labour Standards. It
stipulates the social, ethical and environmental standards that we
expect, including in areas such as child and forced labour, health and
safety, working hours, discrimination and disciplinary processes.
Click to read our Code of Ethical Purchasing:
vodafone.com/code-of-ethical-purchasing
Click or scan to watch a video
summarising our human rights
approach:
investors.vodafone.com/videos
Click to read more about our
Conflict Minerals Reports
and Statement:
vodafone.com/
responsibleminerals
Governance
The Chief External and Corporate Affairs Officer oversees our human
rights programme and is a member of the Executive Committee. The
Human Rights Manager, working closely with the Vodacom Group
Human Rights Principal Specialist, manages our programme, and is
supported by a cross-functional internal Human Rights Advisory
Group, comprising senior managers responsible for privacy, security,
responsible sourcing and diversity and inclusion, amongst others. We
report regularly on our progress to the Purpose and Reputation
Steering Committee, which assists the Executive Committee in
fulfilling duties with regard to our purpose, reputation management
and policy. This year, we concluded a review of our human rights
impacts, governance and controls, which recognised Vodafone’s
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Our approach
When new suppliers tender for work, they are asked to demonstrate
compliance to policies and procedures that support safe working, diversity
in the workplace, and to address carbon reduction, renewable energy,
plastic reduction, circular economy and product life cycle which account
for up to 20% of the overall evaluation criteria. Commitments made by our
suppliers are assessed against our own purpose strategy with respect
to diversity and inclusion (5%), the environment (5%) and health and safety
(10%) in categories where there is a safety risk. We have included purpose
criteria in all tenders since FY22.
We continue to assess risk during our onboarding process by using a
Supplier Assurance Risk Management (SARM) system for new suppliers in
critical-to-business areas. The system uses logic to qualify suppliers in high
risk areas that are material to our business, namely cyber security, data
privacy, corporate security, environment, antibribery, responsible sourcing,
health and safety and payment card industry. Any identified risks require an
independent policy expert to approve suppliers before they are onboarded
and if necessary to establish a mitigation plan. Our requirements are backed
up by risk assessments, audits and operational improvement processes.
To date, we have improved the supplier qualification process across 19
countries and entities using a risk-based assessment that reviews
compliance of any new suppliers before being onboarded to Vodafone. We
will continue the rollout across local markets throughout the course of
FY25 provided Workers’ Council approval is available.
We report on our approach to preventing modern slavery and human
trafficking in our business and supply chain in our Modern
Slavery Statement.
Click to read our Modern Slavery Statement:
vodafone.com/modern-slavery-statement
Governance
The Chief Financial Officer (‘CFO’) oversees our supply chain and is a
member of the Executive Committee and Board. Reporting to the
CFO, the Chief Executive Officer of the VPC is responsible for the
implementation of our Code of Ethical Purchasing. Progress is
reported regularly to the VPC Board. Procurement is a highly
centralised function within the business, with the majority of our
external spend managed by the VPC. This enables us to maintain a
consistent approach to supplier management and makes it easier to
monitor and improve supplier performance across our markets.
Business integrity
We aim to ensure that our business operates
ethically, lawfully and with integrity wherever we
operate as this is critical to our long-term success.
Tax and economic contribution
As a major investor, taxpayer and employer, we make a significant
contribution to the economies of the countries where we operate.
In addition to direct and indirect taxation, our financial contributions
to governments also include other areas such as radio spectrum fees
and spectrum auction proceeds.
Tax transparency
Our tax report sets out our total contribution to public finances on a
cash-paid basis for both 2022 and 2023. In 2023, we contributed,
directly and indirectly, €9.3 billion (€12.1 billion including Italy and
Spain) to public finances worldwide, compared with €8.2 billion (€9.9
billion including Italy and Spain) in 2022. The year-on-year increase
was due to €0.4 billion corporate income tax payments across Europe,
as well as €0.3 billion indirect taxes and €0.3 billion other
telecommunications specific economic contributions, such as
payments for the right use spectrum. In 2023, we paid over €2.6
billion in direct taxes, nearly €1.3 billion via telecommunications
specific economic contributions, and collected nearly €5.4 billion in
corporate income taxes for governments around the world.
Maintaining trust in the creation and execution of our tax strategy,
policies and practices is absolutely core to our approach to tax, as is
our focus on transparency. We disclose our financial contributions to
governments at a country level, as we believe this is an important way
to demonstrate that it is possible to achieve an effective balance
between a company’s responsibilities to society as a whole, through
the payment of taxes and other government revenue-raising
mechanisms, and its obligations to shareholders including that they
understand our approach to taxation, policies and principles. The
information we share aims to help our stakeholders understand our
approach, policies, and principles.
We share our views on key topics of relevance, including the latest
on the taxation of the digital economy, as well as by publishing our
OECD country-by-country disclosure, as submitted to the UK’s tax
authority, HMRC. In addition, we also publish how our disclosures
compare to the B Team tax principles and the requirements of the
Global Reporting Initiative.
Our tax report for 2024 will be published by the end of the financial
year, following the submission of our tax returns and payment of all
applicable taxes.
Click or scan to watch a summary
of our approach to taxation:
investors.vodafone.com/videos
Click to read more
about our tax and
economic contribution to
public finances:
vodafone.com/tax
Anti-bribery, corruption and fraud
At Vodafone, we support and foster a culture of zero tolerance
towards bribery, corruption or fraud in all our activities.
Our anti-bribery policy
Our policy on this issue is summarised in our Code of Conduct and
states that employees or others working on our behalf must never
offer or accept any kind of bribe. Our anti-bribery policy is consistent
with the UK Bribery Act and the US Foreign Corrupt Practices Act and
provides guidance about what constitutes a bribe, and prohibits giving
or receiving any excessive or improper gifts and hospitality. Any policy
breaches can lead to dismissal or termination of contract.
Click to read our Code of Conduct:
vodafone.com/code-of-conduct
Click to read more about our approach to Anti-bribery and corruption:
vodafone.com/sustainable-business/operating-responsibly
Facilitation payments are strictly prohibited, and our employees are
provided with training and guidance on how to respond to demands for
facilitation payments. The only exception is when an employee’s personal
safety is at risk. In such circumstances, when a payment under duress
is made, the incident must be reported as soon as possible afterwards.
We regularly monitor our anti-bribery programme to ensure it is
implemented through conducting periodic monitoring activities, risk
assessment, policy compliance reviews and internal audits.
To support our approach, we are also a member of Transparency
International UK’s Business Integrity Forum.
Note:
1. Includes suppliers to our discontinued operations in Italy and Spain.
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Assurance
Implementation of the anti-bribery policy is monitored regularly in
all local markets as part of the annual Group assurance process,
which reviews key anti-bribery controls. During FY24 we completed
an on-site policy compliance review in Czech Republic. Further to this,
in the DRC, Egypt, Greece, Tanzania, Turkey and Vodafone Group
Services, selected key controls were evaluated to ensure their
effective implementation. The annual assurance paper submitted to
the Group Risk and Compliance Committee documents the key
outcomes of these assurance activities and outlines the actions for
the programme in the coming year. The results show that the
anti-bribery programme has been well implemented and that the
markets have strong controls in place to mitigate bribery risks. Some
improvement areas were identified in third-party risk management,
which remains a key focus area. Appropriate enhancement measures
have been put in place.
Fraud
Fraud is a growing threat globally, impacting our customers,
reputation, and financial performance. The Executive Committee and
the Audit and Risk Committee have recognised this through
significant focus on the oversight of management capability
development to mitigate the risk of fraud and protect our customers
and employees. Vodafone delivers fraud management through a
global organisation and operating model, utilising a combination of
global (Fraud Centre of Excellence), central (_VOIS) and local
(dedicated fraud team in each local market and for Group entities)
resource. This blend of resources allows us to provide timely,
effective, localised responses to any incidences of fraud, whilst also
ensuring that any intelligence and best practice that may benefit the
wider organisation is curated and shared. We continuously evolve our
fraud technology and ways of working, adapting to the tactics used by
fraudsters, and also aligning with key partner teams such as cyber
security to leverage our respective strengths and establish a robust,
layered defence. The protection of customers and support for victims
of fraud are paramount in our global fraud strategy. We are working to
enhance our capability in these regards through a combination of
technical solutions, operational processes and raising awareness.
Purpose (continued)
Risk
Response
Operating in
high-risk markets
We undertake biennial risk assessments in each of our local operating companies and at Group level, so we can
understand and limit our exposure to risk.
Business acquisition
and integration
Proportionate anti-bribery pre- and post acquisition due diligence are carried out on a target company. Red flags
identified during the due diligence process are reviewed and assessed. Following acquisition, we implement our
anti-bribery programme.
Spectrum licensing
To reduce the risk of attempted bribery, a specialist spectrum policy team oversees our participation in all negotiations
and auctions. We provide appropriate training and guidance for employees who interact with government officials on
spectrum matters.
Building and
upgrading networks
Our anti-bribery policy makes it clear that we never offer any form of inducement to secure a permit, lease or access
to a site. We regularly remind all employees in network roles of this prohibition, through tailored training sessions
and communications.
Working with
third parties
Third-party due diligence is completed at the start of our business relationship with suppliers, other third parties and
partners. Through their contracts with us, our suppliers, partners and other third parties make a commitment to
implement and maintain proportionate and effective anti-bribery compliance measures.
We regularly remind current suppliers of our policy requirements and complete detailed compliance assessments
across a sample of higher-risk and higher-value suppliers. Selected high-risk third parties are trained to ensure
awareness of our zero-tolerance policy.
Winning and
retaining business
We provide tailored training for our Vodafone Business and Partner Markets sales teams. In addition, we also maintain
and monitor an online register of gifts and hospitality to ensure that inappropriate offers are not accepted or extended
by our employees.
Governance and risk assessment
Our Group Chief Executive and Executive Committee oversee
our efforts to prevent bribery. They are supported by local market
chief executive officers, who are responsible for ensuring that our
anti-bribery programme is implemented effectively in their local
market. They in turn are supported by local specialists and by a
dedicated Group team that is solely focused on anti-bribery policy
and compliance. The Group Risk and Compliance Committee assists
the Executive Committee in fulfilling duties with regard to risk
management and policy compliance.
As part of our anti-bribery programme, every Vodafone business must
adhere to minimum global standards, which include:
– Ensuring there is a due diligence process for suppliers and business
partners at the start of the business relationship;
– Completion of the global e-learning training for all employees, as
well as tailored training for higher risk teams; and
– Using Vodafone’s online gifts and hospitality registration platform,
as well as ensuring there is a process for approving local
sponsorships and charitable contributions.
The risks we face evolve constantly but broadly fall into the areas
summarised in the table below, which outlines the principal risk
categories and the mitigation measures adopted.
Engaging employees to raise awareness of bribery risk
We run a multi-channel high-profile global communications
programme, ‘Doing What’s Right’ (‘DWR’) to engage with employees
and raise awareness and understanding of the policy. The DWR
programme features e-learning training, including a specific
anti-bribery module. Of those employees (including management)
assigned training during the period, 96% had completed the training
as at 31 March 2024. For higher-risk employees, additional tailored
training programmes are used to cover scenarios relevant for those
employees. We also conduct internal communication campaigns
using a range of materials to highlight some of the key messages
around zero tolerance of bribery and corruption, including
communications from senior management.
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Financials
Other information
External ESG assurance
KPMG LLP has provided independent limited assurance over selected data within our ESG Addendum and this report, using the assurance
standards ISAE (UK) 3000 and ISAE (UK) 3410 for selected GHG data. KPMG LLP has issued an unqualified opinion over the selected data and
their full assurance statement, along with the reporting criteria, is available on our website at investors.vodafone.com/esgaddendum.
The data subject to KPMG LLP’s assurance is detailed below
Pillar
Metric
Unit
2024
Empowering
People
4G population coverage (outdoor 1Mbps) - Group
%
87
Cumulative V-Hub unique visitors
million
6.4
Number of financial inclusion customers
million
66.2
Protecting our Planet Total Scope 1 GHG emissions
million tonnes CO2e
0.27
Total Scope 2 GHG emissions (location-based)
million tonnes CO2e
2.11
Total Scope 2 GHG emissions (market-based)
million tonnes CO2e
0.44
Total GHG emissions: Scope 1 and Scope 2 (location-based)
million tonnes CO2e
2.38
Total GHG emissions: Scope 1 and Scope 2 (market-based)
million tonnes CO2e
0.71
Total Scope 3 GHG emissions
million tonnes CO2e
6.84
Grid renewable electricity purchased (% of purchased electricity)
%
88
Maintaining Trust
Percentage of women in management and senior leadership roles
%
36
Notes:
1. KPMG have assured the KPIs listed above for our total operations.
2. With the exception of the metrics outlined in the assurance table above, the information contained within the Purpose section (pages 32 to 54) has not been independently verified or assured.
While all reasonable care has been taken to ensure the accuracy of the data, Vodafone has not arranged for independent verification of the data with respect to its accuracy or completeness.
Our ESG Addendum Methodologies document includes further information with regard to reporting methodologies for certain metrics: investors.vodafone.com/esgmethodology.
ESG cautionary statement
In preparing the ESG-related information contained in this document, we have made a number of key judgements, estimations and assumptions.
The processes, methodologies and issues involved in preparing this information are complex. The ESG data, models and methodologies used are
often relatively new, are rapidly evolving and are not necessarily of the same standard as those available in the context of financial and other
information, nor are they subject to the same or equivalent disclosure standards, historical reference points, benchmarks or globally accepted
accounting principles. It is not possible to rely on historical data as a strong indicator of future trajectories in the case of climate change and its
evolution. Outputs of models, processed data and methodologies may be affected by underlying data quality, which can be hard to assess, and we
expect industry guidance, standards, market practice and regulations in this field to continue to evolve. There are also challenges faced in relation
to the ability to access certain data on a timely basis and the lack of consistency and comparability between data that is available. This means the
ESG-related forward-looking statements, information and targets discussed in this document carry an additional degree of inherent risk and uncertainty.
UK Streamlined Energy and Carbon Reporting (‘SECR’)
In accordance with SECR requirements, the following table provides a summary of GHG emissions and energy data1 for Vodafone UK, in
comparison with global performance.
ESG Addendum FY24
ESG Addendum FY24/prior year disclosed
2024
2023
Group
(excluding
Vodafone UK)
Vodafone UK
Group total
Vodafone UK
as a % of
Group data
Group
(excluding
Vodafone UK)
Vodafone UK
Group total
Vodafone UK
as a % of
Group data
Total Scope 1 GHG emissions (million tonnes CO2e)
0.26
0.01
0.27
3%
0.27
0.01
0.28
4%
Total Scope 2 market-based GHG emissions
(million tonnes CO2e)
0.44
-
0.44
0%
0.69
0.00
0.69
0%
Total Scope 2 location-based GHG emissions
(million tonnes CO2e)
2.11
0.00
2.11
0%
1.94
0.14
2.08
7%
Total GHG emissions per € million of revenue
(tonnes of CO2e)
14.90
1.00
15.90
6%
19.76
1.47
21.20
7%
Total energy consumption (GWh)3
5,900
708
6,608
11%
5,618
656
6,274
10%
Notes:
1. Data is calculated using local market actual or estimated data sources from invoices, purchasing requisitions, direct data measurement and estimations. Carbon emissions calculated in line with
GHG Protocol standards. Scope 2 market-based emissions are reported using the market-based methodology in effect as at the date of this report. For full methodology see our ESG Addendum
Methodology document: investors.vodafone.com/esgmethodology.
2. More information on energy efficiency initiatives implemented during the year can be found on pages 38 to 39 and in our disclosures prepared in accordance with the SASB standards. For more
information, please visit: investors.vodafone.com/sasb.
3. Information for prior periods is not presented as the organisational boundaries for financial reporting are not consistent with those used in the calculation of GHG emissions. For information about
intensity metrics for prior periods, see our FY23 ESG Addendum: investors.vodafone.com/esgaddendum.
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Other information
Purpose (continued)
Reporting requirement
Vodafone policies and approach
Section within Annual Report
Page(s)
Environmental matters
Planet performance
Protecting our Planet
38 to 42
Climate change risk
Risk management
64 to 69
Employees
Code of Conduct
Responsible business and
anti-bribery, corruption and fraud
44 and
53 to 54
Occupational health and safety
Health and safety
19 to 20
Diversity and inclusion
Workplace equality
17 to 19
Social and community matters
Driving positive societal
transformation performance
Empowering People
35 to 37
Stakeholder engagement
Stakeholder engagement
12 to 14
Mobiles, masts and health
Mobiles, masts and health
51
Human rights
Human rights approach
Human rights
51 to 52
Code of Ethical Purchasing
Responsible supply chain
52 to 53
Modern Slavery Statement
Responsible supply chain
53
Anti-bribery and corruption
Code of Conduct
Maintaining Trust
44
Anti-bribery policy
Anti-bribery, corruption and fraud
53 to 54
Speak Up process
Maintaining Trust
44
Policy embedding, due diligence and outcomes
Purpose, Empowering People, Protecting the
Planet and Maintaining Trust
32 to 54
Risk management
57 to 63
Description of principal risks and impact
of business activity
Risk management
57 to 63
Description of business model and strategy
Business model
Chief Executive’s statement
and strategic roadmap
4 to 5
9
Non-financial key performance indicators
Key performance indicators
Purpose, Empowering People, Protecting the
Planet and Maintaining Trust
6 to 7
32 to 54
Non-financial and sustainability information statement
The table below outlines where the key content requirements of the non-financial and sustainability information statement can be found
within this document (as required by sections 414CA and 414CB of the Companies Act 2006).
Vodafone’s sustainable business reporting also considers other international reporting frameworks, including the Global Reporting Initiative,
the SASB Standards, CDP and the GHG Reporting Protocol.
Click to download our ESG Addendum:
investors.vodafone.com/esgaddendum
Click to read our ESG Addendum Methodology
document:
investors.vodafone.com/esgmethodology
Click to read our SASB disclosures:
investors.vodafone.com/sasb
Companies Act (2006) climate-related financial disclosures
Disclosures in compliance with the requirements of the UK Companies Act 2006 (as required by sections 414CA and 414CB) can be found in
the Risk Management section of our Strategic Report as follows:
Companies Act climate-related financial disclosure
Location of disclosure in this report
Page
Governance arrangements for assessing and managing climate-related risks and opportunities Governance
64-65
How Vodafone identifies, assesses and manages climate-related risks and opportunities
Strategy
65-67
Integration of climate-related risk identification, assessment and management processes into
our overall risk management process
Risk management
67-69
Principal climate-related risks and opportunities arising in connection with our operations
Our priority climate-related risks and opportunities
65
The time periods by reference to which those risks and opportunities are assessed
Our exposure to risks and opportunities across a range
of scenarios
66
The actual and potential impacts of the principal climate-related risks and opportunities on the
company’s business model and strategy
Our exposure to risks and opportunities across a range
of scenarios
66
Resilience of our business model and strategy in different climate-related scenarios
Building climate-related risk into our business strategy 66-67
Our targets to manage climate-related risks and to realise climate-related opportunities and
performance against targets
Metrics and targets
Purpose, Protecting the Planet, Our Planet goals
69
38
Key performance indicators for assessing progress against targets
Metrics and targets
ESG Addendum
69
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Other information
Risk management
Managing uncertainty in our business
Overview of risk governance structure
Board/Audit and Risk Committee
– Provide oversight for Vodafone Group
– Discuss, challenge and make a robust assessment of principal and emerging risks
– Embed appropriate risk culture throughout the organisation
Local oversight committees
Provide oversight for the local risk management programme
Local market CEOs
Set local objectives, identify priority risks and align tolerance levels with the
Vodafone Group guidance
Local risk owners
Senior managers in local management teams are responsible for local risks and the
local risk programme to manage, measure, monitor, and report on the risks
Risk and Compliance
Committee
– Reviews principal,
watchlist and
emerging risks
– Reviews
effectiveness of
risk management
across the Group
Group risk team
– Responsible for the
application of the global risk
management framework
– Supports the Board/ExCo
by creating programmes to
strengthen our risk culture
Group risk owners
– ExCo risk owners
have responsibility
for management
of the risks assigned
to them
– Senior executive risk
champions identify
and implement
mitigating actions
Assurance
Assurance functions
Review and provide
assurance over selected
controls for the Group
and local markets
Internal audit
Supports the Audit
and Risk Committee
in reviewing the
effectiveness of the
global risk management
framework and
management of
individual risks
Vodafone Group
Local markets or
Group entities
We face multiple risks and uncertainties that could
affect the success of our business. We mitigate
these risks through a robust risk management
framework and by integrating risk management
into our daily operations and culture.
Governance and identifying our risks
The Audit and Risk Committee, on behalf of the Board, reviews and
challenges the principal and emerging risks as well as advises on the
level of risk the Company is willing to take in achieving its strategic
goals. The Board approves Vodafone’s strategy and aligns the risk
management approach with it. The risk function aims to make risk
considerations an integral part of executing our strategy, enabling
informed decision-making across all our markets.
Our risk management approach is end-to-end, starting with local
markets and Group entities identifying and evaluating risks to their
local strategy. The Group risk team centrally assesses and challenges
these risks. A comprehensive list of risks, along with external risk
scanning findings, is presented to the Directors and executives for
analysis and identification of significant risks. The proposed principal
(pages 58 to 61), watchlist, and emerging (page 62) risks are agreed
by our Executive Committee (‘ExCo’) before being submitted to the
Audit and Risk Committee and the Board for review and approval.
Managing our risks
It is important to establish the context and understand the
environment in which we operate. We categorise our risks into
different risk types (strategic, operational, or financial) and identify
whether the source of the threat is internal or external. This helps us
effectively treat risks and provide appropriate oversight and
assurance.
Executive risk owners have the responsibility to put in place adequate
controls and necessary treatment plans to bring risks within
acceptable tolerance levels. Additionally, risk treatment plans and the
effectiveness of our current controls are monitored through in-depth
risk reviews, which are presented to relevant oversight committees.
Read more about the Audit and Risk Committee
on pages 89 to 94
For each principal risk, we develop severe but plausible scenarios to
understand the impact if it were to materialise. These scenarios
provide additional insights into possible threats and improve the
treatment strategy. They are also used to assess our viability.
Read more about our long-term viability statement
on page 63
The diagram below illustrates a simplified, high-level governance
structure for risk management.
Local risk managers
Are the contact point for each market/entity on risk, and facilitate all activities as defined
by the global risk management framework
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Other information
Principal risks
Adverse changes in
macroeconomic conditions
Principal risks
Financial
Risk related to our financial status, standing and continued growth
A
Adverse changes in macroeconomic conditions
Strategic
Risks affecting the execution of our strategy
B
Adverse political and policy environment
C
Adverse market competition
D
Disintermediation
E
Portfolio transformation and governance of investments
Operational
Risks impacting our operations
F
Company transformation
G
Cyber threat
H
Data management and privacy
I
Supply chain disruption
J
Technology resilience and future readiness
Risks are ordered by category and not by priority.
Year-on-year risk ranking movement
Increasing
Decreasing
No change
New/change in scope
Risk interdependencies
By analysing the connectivity between risks we can identify those that have the potential to
impact or increase other risks, so that they are weighted appropriately.
This exercise also informs our scenario analysis, particularly the combined scenario used in
the long-term viability statement.
Read more about our long-term viability statement
on page 63
Risk management (continued)
Description
Adverse changes to economic conditions
could result in reduced customer spending,
higher interest rates, adverse inflation, or
adverse foreign exchange rates. Adverse
conditions could also lead to limited debt
refinancing options and/or increase in costs.
Risk ranking
movement
Risk owner
Group Chief Financial Officer
Scenario
A severe contraction in economic activity
leads to lower cash flow generation for the
Group and disruption in global financial
markets, which impacts our ability to
refinance debt obligations as they fall due in
a cost-effective manner.
Emerging factors
Because this is an externally driven risk, the
threat environment is continually changing.
External factors such as the conflicts in the
Middle East, the ongoing war in Ukraine and
uncertainty around the future path of
monetary and fiscal policies could have
impacts on economic activity across our
markets. The financial markets are
experiencing high levels of volatility, with
sovereign debt at record levels. These
factors could lead to a significant change in
the availability and cost of capital.
Mitigation activities
We have a relatively resilient business
model. We continue to keep a close eye on
the possibility of recessions, which could
manifest differently across our various
jurisdictions. For our consumers who might
be affected by an economic downturn, we
offer competitive options and social plans
and tariffs in the markets in which we
operate. We have a long average life of debt,
which reduces refinancing requirements,
and all of our bond debt is effectively held at
fixed interest rates.
Key:
External
Internal
Bidirectional
Unidirectional
O
pe
ra
ti
on
al
St
ra
te
gi
c
Fi
n
an
ci
al
C
D
B
A
F
E
H
J
G
I
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Other information
Adverse market competition
Adverse political and policy
environment
Company transformation
Description
Increasing competition could lead to price
wars, reduced margins, loss of market share
and/or damage to market value.
Description
Adverse political and policy measures
impacting our strategy could result in
increased costs, create a competitive
disadvantage, or have a negative impact on
our return on capital employed.
Description
Failure to effectively and successfully
transform Vodafone to adapt to future
challenges and demands could result in
outdated business models, increased
operational complexity, and hinder growth.
Scenario
Aggressive pricing, accelerated customer
losses to low-value players on mobile and
fixed, and disruptive new market entrants in
key European markets could result in
greater customer churn and pricing
pressures, impacting our financial position.
Emerging factors
Emerging factors often depend on individual
market structures and the competitive
landscape. External factors such as local and
macroeconomic pressures, may impact
household and individual connectivity
spend. In addition, continued aggressive
penetration pricing by disruptive low-price
players across markets on both mobile and
fixed could accelerate customer losses and
drive prices down in markets.
Mitigation activities
We closely monitor the competitive
environment in all markets and react
accordingly to both consumer and business
needs. We have initiated Group-wide
programmes to focus on the customers
which is one of our strategic priorities. We
keep investing in our brand and
differentiated customer experience, and we
design propositions with additional benefits,
such as flexible device financing, integrated
trade-in, refurbished devices, and social
tariffs. In addition, in many markets we utilise
‘second’ brands to compete more effectively
and efficiently in the value segment.
Scenario
Uncertainty in and the growing complexity
of the global and national political
environments may lead to unexpected
political or regulatory interventions that
would adversely affect our operations.
Emerging factors
Geopolitical tensions and ongoing conflicts
amplify the risk of government intervention,
which may include both protectionist
interventions and security-related
requirements. These could affect our
operations, supply chains and conditions for
competition in various ways. The increasing
breadth and depth of external geopolitical
challenges means there is a continuous
need to adapt to effectively mitigate the
changing risk environment. Heightened
uncertainty from elections in 2024 and the
proliferation of emerging technologies also
contribute to this risk.
Mitigation activities
We actively monitor the external horizon,
gather intelligence to inform decision-
making and proactively engage with
policymakers, regulatory authorities,
customers and relevant stakeholders to find
mutually acceptable ways forward. As a last
resort, we uphold our rights through legal
means.
Scenario
Changes to drive organisational simplicity
could result in lower employee
engagement, higher talent attrition, and
failure to become a more efficient
organisation.
Emerging factors
The scale and increasing volume of internal
change being undertaken may put
additional strain on our people and culture
causing fatigue and/or disengagement. This
could result in a failure to deliver with the
focus and operational excellence required to
drive success from these transformations.
Additionally, the commercialisation of our
shared operation capabilities to both internal
and external customers, could increase the
complexity of service line pricing and
internal pricing models.
Mitigation activities
We have governance structures in place,
sponsored by the ExCo, to align on potential
changes. These structures consider
implications, risks and mitigating actions
across all relevant dimensions. Specialist
teams manage our company transformation
agenda. Leadership lab programmes are in
place to deliver the cultural shift needed to
deliver these programmes.
Risk ranking
movement
Risk owner
Chief Commercial Officer
Risk ranking
movement
Risk owner
Chief External and Corporate
Affairs Officer
Risk ranking
movement
Risk owner
Chief Human Resources
Officer/ Group Chief Financial
Officer
Year-on-year risk ranking movement
Increasing
Decreasing
No change
New/change in scope
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Other information
Risk management (continued)
Cyber threat
Disintermediation
Data management and privacy
Description
Failure to effectively respond to threats from
emerging technology or disruptive business
models could lead to a loss of customer
relevance, market share and new/existing
revenue streams.
Description
An external cyber attack, insider threat or
supplier breach could cause service
interruption or data breach.
Description
Data breaches, misuse of data, data
manipulation, inappropriate data sharing,
poor data quality or data unavailability could
lead to fines, reputational damage, loss of
value, loss of business opportunity, and
failure to meet customer expectations.
Risk ranking
movement
Risk owner
Chief Commercial Officer/
CEO Vodafone Business
Risk ranking
movement
Risk owner
Group Chief Technology
Officer
Risk ranking
movement
Risk owner
Group General Counsel and
Company Secretary/Group
Chief Financial Officer
Scenario
Threat actors could use destructive malware
against core infrastructure to disable our
ability to serve customers, causing customer
dissatisfaction and loss of revenue.
Emerging factors
Cyber risk is constantly evolving and is
influenced by economic, technological and
geopolitical developments. We anticipate
threats will continue from existing sources
as well as evolving ones based on new
technologies such as artificial intelligence
(‘AI’) and quantum computing.
Mitigation activities
Our cyber security strategy has a risk and
control framework to manage cyber risk to
our networks and services. Our controls
identify, protect against, detect, respond to,
and recover from threats. We measure the
control baseline across all parts of the
Company and have an in-house team of
experts in cyber security. We embed security
by design into our products, services and
internal operations. Protective controls
mitigate the effect of most threats; however,
when attacks are successful we focus on
rapid response to minimise business and
customer impact. Root cause analysis
provides continuous improvement and
drives action.
Click to read more about our approach to cyber
security in our fact sheet: investors.vodafone.
com/cyber
Scenario
Failure to manage the privacy of our
stakeholders’ data effectively and
compliantly could result in regulatory fines,
paying significant damages to impacted
individuals, and also reputational damage
that could result in higher customer churn
rates.
Emerging factors
The proliferation of AI and related regulatory
and legislative action across our footprint
requires a robust ethics and compliance
approach. Geopoliticisation of data will
continue to negatively impact cross-border
data transfers. New European data
regulations, such as the Artificial Intelligence
Act or the Cyber Act, will introduce
significant new legal requirements around
data management of our business activities.
Mitigation activities
Our data and privacy strategies are designed
to continually reduce the risks. We regularly
conduct reviews of our significant privacy
and data risks. We use the outcomes to
prevent, detect and respond to the risks on a
prioritised basis. When incidents do occur,
we identify the root causes and use them to
improve our controls.
Read more about our approach to data management
and privacy on pages 45 and 46
Scenario
Increasing ‘softwareisation’ of connectivity
services combined with the growing
ecosystem power of Big Tech companies
could see the emergence of competitors
and distribution channels with the potential
to disintermediate our customer
relationships.
Emerging factors
In our consumer business, alternative
technology solutions may enable new
intermediaries to sell communication
propositions, while our TV customers may
switch to ‘over-the-top’ video-on-demand
services. In our corporate business, the
‘softwareisation’ of services may enable new
competitors in the value chain. In our
infrastructure markets, supplier
concentration within the satellite
connectivity market and hyperscaler
investment in orchestration and network
capabilities may present future additional
challenges.
Mitigation activities
Our increasingly deep partnerships with big
technology players and the potential to
leverage the new Digital Markets Act have
improved our ability to defend against the
customer ownership risks. In addition, we
continue to focus intensively on improving
our customers’ experience, strengthening
our propositions and bundling digital
services for consumer and business markets
to enhance customer loyalty.
Year-on-year risk ranking movement
Increasing
Decreasing
No change
New/change in scope
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Other information
Portfolio transformation and
governance of investments
Supply chain disruption
Technology resilience and
future readiness
Description
Failure to manage appropriate joint ventures
(‘JVs’), and other investments or challenges
to the timely completions of inflight
portfolio actions may result in a loss of
growth potential and shareholder value.
Description
Disruption in our supply chain could mean
that we are unable to execute our strategic
plans, resulting in product and service,
unavailability and delays, increased cost,
reduced choice, and lower network quality.
Description
Network, system or platform outages or
ineffective execution of the technology
strategy could lead to dissatisfied customers
and/or impact revenue.
Risk ranking
movement
Risk owner
Group Chief Executive
Officer/CEO Vodafone
Investments
Risk ranking
movement
Risk owner
Group Chief Financial Officer
Scenario
Regulations imposed delays or disruptive
remedies for in-market consolidation.
We are adversely impacted by market
remedies imposed by regulators following
in-market consolidation. Additionally,
we may face unforeseen challenges in
driving synergy benefits.
Emerging factors
Adverse change in the regulators’ approach
to in-market consolidation may limit
opportunities for value-accretive market
structures. Additionally, our internal
capability and skill sets may not align with
the needs of our portfolio structure as we
increase our focus on JVs and investments.
Mitigation activities
We will continue to mitigate the risk in
transaction execution by conducting broad
stakeholder engagement and having
dedicated teams working on any transition
and future services arrangements.
We have reviewed a number of our
investment governance mechanisms and
where needed enhancements have been
made. In our JV governance and ways of
working policy, we outline the principles for
the shareholder agreement and corporate
governance. This includes how we engage
with the individual entities. Furthermore, we
now have a dedicated ExCo member and
team with responsibility to maximise the
opportunities and minimise the risk.
Scenario
Political decisions affecting our ability to use
equipment from specific vendors could
cause trade and supply chain disruptions.
Emerging factors
Changes in the political landscape outside
Vodafone’s control may significantly impact
the upgrade and maintenance of our
network. For example, US and China
tensions resulting in a ban of high-risk
vendors, long-term impacts from the war in
Ukraine, or potential open conflict between
China and Taiwan could impact product
availability. Disruption may lead to an
increase in our costs in areas such as raw
materials, energy, and shipping, while at the
same time triggering shortages or extended
lead times for critical components.
Mitigation activities
We are closely monitoring the evolution of
the geopolitical environment. This enables
us to respond to emerging challenges and
to comply with regulations, economic
sanctions and trade rulings. We also mitigate
our exposure through having multi-year
contracts with key suppliers, forecasting and
forward-ordering our inventory
requirements in anticipation of extended
lead times and continuing to execute our
optimisation strategy for network
infrastructure logistics.
Scenario
A major outage in a critical data centre or a
failed IT transformation activity could reduce
service to customers, affecting revenue and
reputation.
Emerging factors
Like most mature companies, we continue
to proactively manage our systems life
cycle. We closely monitor our technology
landscape for additional systems nearing
end of life and have associated plans to
mitigate or replace. Another emerging factor
is the inability to deliver large IT
transformations at the forecasted pace
because of changes in macroeconomic
conditions, market pressures, and evolving
customer expectations. Additionally,
extreme weather events, and deliberate
attacks on national critical infrastructure in
times of war or instability, could also
heighten the risk of technology failure.
Mitigation activities
To reduce the impact of service disruptions,
we establish recovery goals for critical
assets. A global policy outlines the key
performance indicators (‘KPIs’) necessary to
guarantee the resilience and security of
technology services. We prioritise IT
transformation and modernisation
programmes, such as the Oracle Cloud
Infrastructure, SAP RISE, and the recent
Azure cloud agreement with Microsoft, to
address specific technology resilience risks,
while streamlining business processes and
simplifying the portfolio. In addition, IT
transformation programmes carry risks of
scope creep and cost overruns; therefore,
we are increasingly using an incremental
delivery approach to be able to achieve
benefits and adapt quickly, while
maintaining strict governance.
Risk ranking
movement
Risk owner
Group Chief Technology
Officer/Group Chief Network
Officer
Year-on-year risk ranking movement
Increasing
Decreasing
No change
New/change in scope
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Risk management (continued)
Watchlist risks
Our watchlist risk process enables us to monitor material risks to
Vodafone Group that fall outside our principal risks. These include,
but are not limited to:
Environmental, Social and Governance (‘ESG’)
Failure to prioritise ESG considerations may result in reputational
damage. Negative publicity related to environmental harm, social
issues, or governance failures can lead to loss of trust amongst
customers, investors and the broader public.
Read more about our approach
to ESG on pages 32 to 56
Read more about climate-related risk
on pages 64 to 69
Product innovation
Failure to create and deliver new products and service categories that
diversify revenue growth, unlock new consumer engagement and
mitigate disruption from digital natives.
Legal compliance
Non-compliance with laws and regulations including anti-bribery,
competition law, anti-money laundering, trade controls and sanctions,
potentially leading to fines and reputational risk.
Read more about ‘Doing What’s
Right’ training on page 44
Read more about our anti-bribery,
corruption and fraud policy
on pages 53 to 54
Tax
Tax risk covers our management of tax across the markets in which
we operate and how we respond to changes in tax law, which may
have an impact on the Group.
Read more about our tax risk and our approach to tax and our economic contribution
on page 53
Infrastructure competitiveness
We continue to provide the appropriate broadband technology in our
fixed and mobile networks. Our technology 2025 strategy
incorporates our fixed and mobile network evolution steps to
enhance our coverage and network performance.
Click to read more about our Technology 2025 Strategy in our investor briefing:
investors.vodafone.com/vtbriefing
Emerging risks
We face a number of uncertainties where an emerging risk may
potentially impact us. In general, we encounter three types of
emerging risks. The first type is a new risk in a known context, where it
emerges from the external environment and can impact the
organisation’s activities. An example of this is the potential impact of
conflict in the Middle East. The second type is a known risk in a new
context, such as the need for new skills and talent to support future
services. The third type is a new risk in a new context, such as the
impact of the commercial space age.
We continue to identify new emerging risk trends, using inputs from
analysis of the external environment and internal sources. We
evaluate our risks across different time periods, allowing us to provide
the appropriate level of focus on these emerging risks. We categorise
our emerging risk into five different categories: technological,
political/regulatory, economic, societal and business environment, so
that the relevant expertise across the business can assess the
potential impacts and time horizon of these risks.
In some cases, there may be insufficient information to fully analyse
and understand the likelihood, impact or velocity of the risk. As a
result, we may not be able to develop a complete mitigation plan
until we have a better understanding of the threat.
Our emerging risks, within predefined risk categories, are provided to
the ExCo and the Audit and Risk Committee for further scrutiny.
Building strong foundations
We continue to enhance and embed the global risk management
framework with the objective of maturing our approach. This
promotes consistency across all the markets in which we operate.
Over the course of the year under review, we have:
– Enhanced our risk tooling and methodology to establish a more
straightforward process for documenting and reporting risks from
our local markets;
– Carried out an evaluation to gain a deeper insight into the physical
and transition risks associated with climate change;
– Improved the process of linking risk and mitigation actions to
the budget to improve risk decisions on the risk treatment strategy;
– Following the risk awareness campaign in the previous year,
conducted a risk culture survey with the Group Senior Leadership
Team (‘SLT’) to gather insights into their understanding of the risk
management practices; and
– Conducted an external review to benchmark and evaluate the
maturity of our risk framework and process.
Key changes to our principal risks:
– The risk of Supply chain disruption has increased due to
political uncertainty related to the use of high-risk vendors in
our European markets.
– The risk of Adverse changes in macroeconomic conditions
has decreased as we see an easing in the external economic
outlook. Additionally, over the past year we have implemented
controls, such as hedging for inflation and energy costs to
manage the impact of the risk.
– The Company transformation risk has been broadened to
encompass organisational simplification and other large
non-portfolio transformation projects.
– The scope of the Technology resilience and future
readiness risk has been expanded to include the sub-risk
end-of-service-life and legacy infrastructure, as our technology
environment is ever-expanding, and we see an increasing
number of assets nearing their end of life in this assessment
period.
– The strategic transformation risk was refocused on Portfolio
transformation and governance of investments. As a result,
the sub-risk of product innovation has been moved across to
the watchlist risks, as detailed in the section below.
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The preparation of the LTVS includes an assessment of the Group’s
long-term prospects in addition to an assessment of its ability to
meet future commitments and liabilities as they fall due over the
three-year review period.
Assessment of viability
The Board has chosen a three-year period to assess Vodafone
Group’s viability. This is the period in which we believe our principal
risks tend to develop. This time horizon is also in line with the
structure of long-term management incentives and the outputs from
the long-range business-planning cycle. We continue to conduct
financial stress testing and sensitivity analysis, considering revenue
at risk.
The viability assessment started with the available headroom as of 31
March 2024 and considered the plans and projections assembled
as part of the forecasting cycle, which include the Group’s cash flow,
planned commitments, required funding, and other key financial
ratios. We also assumed that debt refinancing will remain available in
all plausible market conditions.
Finally, we estimated the impact of severe but plausible scenarios for
our principal risks on the three-year plan. We also stress-tested a
combined scenario taking into account the risk interdependencies as
defined in the table on page 58, where the following risks were
modelled as materialising in parallel over the three-year period:
Adverse changes in macroeconomic conditions: Adverse
changes in the macroeconomic environment could result in
restricted ability to refinance, while prolonged high inflation rates,
may lead to increased interest rates.
Cyber threat: A cyber-attack may exploit vulnerabilities, allowing
unauthorised access to IT and network systems, leading to a breach
of information and a potential GDPR fine.
Supply chain disruption: Tensions between the US and China are
uncertain, leading to increased volatility in the geopolitical
landscape. This has the potential to influence political decisions,
which could impact our ability to use equipment from certain
vendors.
Long-term viability statement (‘LTVS’)
Legal: Legal disputes and adverse judgements against the company
resulting in significant financial liabilities, including increased fines,
penalties, or compensatory payments.
Assessment of long-term prospects
The Board undertakes a robust review and challenge of the strategy
and assumptions. Each year the Board conducts a strategy session,
reviewing the internal and external environment as well as significant
threats and opportunities to the sustainable creation of long-term
shareholder value (note that known emerging factors related to each
principal risk are described on pages 58 to 61).
As an input to the strategy discussion, the Board considers the key
risks (including Adverse changes in macroeconomic conditions,
Cyber threat, Supply chain disruption, and Legal) with the focus
on identifying underlying opportunities and setting the Group’s
future strategy. The output from this session is reflected in the
strategic section of the Annual Report (page 9), which provides a
view of the Group’s long-term prospects.
Conclusions
The Board assessed the prospects and viability of the Group in
accordance with provision 31 of the UK Corporate Governance Code,
considering the Group’s strategy and business model, and
the principal risks to the Group’s future performance, solvency,
liquidity and reputation. The assessment took into account possible
mitigating actions available to management were any
risk or combination of risks to materialise.
Cash and cash equivalents available of €6.1 billion (page 186) at
31 March 2024, along with options available to reduce cash
outgoings over the period considered, provide the Group with
sufficient positive headroom in all scenarios tested. Reverse stress
testing on revenue and adjusted EBITDAaL over the review period
confirmed that the Group has sufficient headroom available to face
uncertainty. The Board deemed the stress test conducted to be
adequate, and therefore confirmed that it has a reasonable
expectation that the Group will remain in operation and be able to
meet its liabilities as they fall due up to 31 March 2027.
Assessment of prospects
Assessment of viability
Outlook, strategy and business model
Outlook of possible long-term scenarios expected in the sector and the Group’s current position to face them
Assessment of the key principal risks that may influence the Group’s long-term prospects
Articulation of the main levers in the Group’s strategy and business model to sustain value creation
Long-Range Plan is the three-year forecast approved by the Board on an annual basis, used to calculate cash position and headroom
Headroom is calculated using cash, cash equivalents and other available facilities, at year end
Sensitivity analysis to assess the level
of decline in performance that the Group
could withstand, if a black swan event were
to occur
Severe but plausible scenarios modelled
to quantify the cash impact of an
individual principal risk materialising
over the three-year period
Quantification of the cash impact of
combined scenarios where multiple risks
materialise across one or more markets,
over the three-year period
Viability results from comparing the cash impact of severe but plausible scenarios to the available headroom, considering additional liquidity options
Long-term viability statement
Directors confirm that they have a reasonable expectation that the Group will be able to
continue in operation and meet its liabilities as they fall due over the three-year period
Sensitivity analysis
Principal risks
Combined scenario
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Climate-related risk
We recognise that both physical changes to the
climate and the transition to a lower carbon
economy pose risks and opportunities for our
business. This section outlines our approach to
governance, strategy, risk management, metrics
and targets in relation to these climate-related risks
and opportunities.
Our disclosure of climate-related risks is well established. We
conducted our first climate-related risk assessment in 2019, and have
published a standalone report annually since 2021 – applying the
framework of recommendations of the Task Force on Climate-related
Financial Disclosures (‘TCFD’). From this year, following the
incorporation of the TCFD framework into the International Financial
Reporting Standards (‘IFRS’), we include our climate-related risk
reporting here, within our Annual Report. We see this as the next
milestone in our journey to integrate the management and disclosure
of climate-related risk into our core business processes.
We continue to report in line with the TCFD framework and its 11
recommendations. This year, we have also prepared this report with
reference to the IFRS S2 Climate-related Disclosures standard, in
preparation for aligning with this in the future.
Governance
Climate-related risks are integrated into our risk management
framework and the Audit and Risk Committee (‘ARC’) executes
responsibility for these risks on behalf of the Board. Vodafone’s
proposed principal risks, watchlist risks and emerging risks are
reviewed and approved by the Executive Committee (‘ExCo’) annually
before being submitted to the ARC and the Board. During FY24,
climate change (which was previously a distinct risk on our watchlist),
was consolidated as a sub-risk of Environmental, Social and
Governance (‘ESG’). This broader ESG risk will be monitored on our
watchlist and reported through our risk governance structure.
Read more about our risk
governance structure on page 57
Read more about watchlist risks
on page 62
Our climate-related risk and resilience programme sits within the
Protecting the Planet part of our Purpose strategy, which is ultimately
overseen and approved by the ESG Committee. The Committee’s
responsibility is to oversee Vodafone’s response to climate change, as
part of our Purpose strategy. The committee meets at least twice per
year to provide direction on the management of risks and
opportunities to Vodafone’s operations and reputation.
At Executive Committee (‘ExCo’) level, the ESG and Reputation
Steering Committee (‘ESGR’) is accountable for the implementation of
the Purpose strategy, and has appointed an Executive sponsor (the
Chief External and Corporate Affairs Officer) to oversee the
implementation of the Protecting the Planet pillar of the strategy. The
Committee reviews progress of delivery of the Protecting the Planet
strategy quarterly, including the assessment and management of
climate-related risks and opportunities. The ESGR reports half-yearly
to the ESG Committee on the status of the Protecting the Planet
strategy, its implementation and progress against targets to support
the Board’s oversight of the management of climate-related risks.
Each year, the ARC and ESG committees meet to jointly review and
provide oversight for the annual climate-related risk disclosure.
Read more about the governance of
our Purpose strategy on page 33
Read more about our ESG Committee
on pages 96 to 97
At operational level, the Group Head of Risk coordinates the annual
programme to identify and assess climate-related risk, with support from
the Head of Sustainable Business. Progress against the annual risk
identification and assessment programme is monitored through the ESGR.
Actions to strengthen our climate resilience and mitigate climate-
related risks were included in our Vodafone Group Climate Transition
Plan (‘CTP’). Accountability for the design and implementation of
these actions and initiatives is assigned to individual senior managers,
within a range of relevant business functions across Vodafone’s global
business including our networks and technology operations,
commercial and enterprise business units, procurement, external
affairs and property teams.
TCFD recommendations
We have considered our obligations under the UK’s Financial
Conduct Authority Listing Rules and have detailed in the table
below the 11 TCFD recommendations and whether we are fully
or partially consistent. For financial year ended 31 March 2024,
our disclosure is consistent with 10 out of 11 TCFD
recommendations. Our disclosure is partially consistent with one
recommendation, related to target-setting, which we intend to
continue progressing in FY25.
Governance
Progress Page
a. Describe the Board’s oversight of climate-
related risks and opportunities
C
64
b. Describe management’s role in assessing and
managing climate-related risks and
opportunities
C
64 to
65
Strategy
Progress Page
a. Describe the climate-related risks and
opportunities the organisation has identified
over the short, medium and long term
C
65
b. Describe the impact of climate-related risks
and opportunities on the organisation’s
businesses, strategy and financial planning
C
66 to
67
c. Describe the resilience of the organisation’s
strategy, taking into consideration different
climate-related scenarios, including a 2°C or
lower scenario
C
66
Risk management
Progress Page
a. Describe the organisation’s processes for
identifying and assessing climate-related risks
C
67
b. Describe the organisation’s processes for
managing climate-related risks
C
69
c. Describe how processes for identifying,
assessing and managing climate-related risks
are integrated into the organisation’s overall
risk management
C
67-69
Metrics and targets
Progress Page
a. Disclose the metrics used by the organisation
to assess climate-related risks and
opportunities in line with its strategy and risk
management process
C
69
b. Disclose Scope 1, Scope 2 and, if appropriate,
Scope 3 emissions, and the related risks
C
69
c. Describe the targets used by the organisation
to manage climate-related risks and
opportunities and performance against targets
PC
69
Key
Consistent with the TCFD recommendations
Partially consistent with the TCFD recommendations
C
PC
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The implementation of the transition plan is also overseen by the
ESGR. Accountable delivery functions report quarterly to the ESGR,
including raising any risks to the delivery of the plan. As a cross-
functional strategic programme, business functions accountable for
the delivery of the transition plan include procurement, commercial,
brand and marketing, networks and technology, enterprise, products
and services, amongst others.
The ESGR identifies any significant business decisions (for example,
major transactions or changes to business strategy) that could impact
Vodafone’s climate resilience or change the severity or likelihood of
climate-related risks. Any risks or issues identified are evaluated by
the risk and sustainable business teams, and if necessary escalated
through the Protecting the Planet and Purpose governance structure
to the ESGR.
We have an internal global policy, owned by the Chief External and
Corporate Affairs Officer, to establish the minimum requirements for
environmental management. All Vodafone entities within the Group’s
operational control (including within Vodacom) are required to
adhere to this policy. The policy includes requirements to annually
review climate-related risks and opportunities within the context of
each market we operate in, and incorporate any significant findings
into our overall Group-level climate-related risk assessment. The
policy also includes requirements to implement the CTP, which
assigns responsibility for taking climate action and building climate
resilience, in line with our strategy, to management across our global
business.
Click to read more about our Climate Transition Plan:
www.vodafone.com/ctp
Strategy
For FY24, our climate-related risk assessment builds upon our
previous analyses, including our quantitative scenario analysis of
physical climate risk in Europe and Vodacom’s assessment of
climate-related risks in Africa. We also conducted a review of
transition risks, which involved desk-based research, internal
stakeholder interviews and a qualitative scenarios analysis, applying
time horizons consistent with our physical risk analysis.
Overall, this year’s risk assessment has led to a refreshed list of our
priority climate-related risks and opportunities.
Read more about our approach to climate-related risk assessment
on page 66
Our priority climate-related risks and opportunities1
Physical risks
(1) Extreme weather: Damage to assets or disruption to our own
operations or supply chain due to extreme weather events such as
storms and cyclones, flooding and wildfires. Our network
infrastructure assets are already being affected by extreme
weather (e.g. flooding in Germany, wildfires in Greece, cyclones in
Mozambique), although currently at a scale that can be managed
to avoid major operational impact, asset impairment or cost.
Longer term, in combination with geopolitical risks, extreme
weather could disrupt supply chains, particularly those that
depend on critical regions (such as China for electronic
components) or locations (such as coastal ports).
Time horizon: Medium term
(2) Rising average temperatures: Rising average temperatures
could damage network equipment and other above-ground
infrastructure or cause operational failure (particularly if located in
exposed outdoor locations, e.g. radio towers), as well as cause
disruption in our supply chain. It could also lead to increasing
consumption of energy for cooling infrastructure, data centres and
offices, which could increase operating costs. We expect this risk
to materialise in the medium term, with the most severe impacts in
the ‘business as usual’ scenario. Higher frequency of hot days is
likely to be more pronounced in our southern European markets
(such as Greece and Portugal) and in African markets.
Time horizon: Medium term
Transition risks
(3) Energy costs: Increasingly volatile energy prices and overall
higher energy costs, partially driven by carbon pricing and demand
for renewable electricity certificates outstripping supply. This risk
is particularly prevalent in markets with high dependency on fossil
fuels (e.g. to operate diesel generators) and non-renewable energy.
However, carbon pricing will also drive an increase in cost to procure
carbon-intensive products and raw materials, as third parties
upstream in the supply chain look to pass through higher costs.
Time horizon: Short term
(4) Regulatory compliance costs: As governments introduce
policies to support the climate transition, these could impact our
product portfolio (such as energy use of fixed line or mobile
devices), operations (such as data centres) or corporate
sustainability reporting and disclosures. Over the medium term, as
these are transposed into law in each of our markets, this could
result in a cost to comply or a financial risk from non-compliance.
Time horizon: Medium term
(5) Expectations of business customers: Loss of market share if
climate performance continues to be a differentiator during
supplier selection by business customers, and Vodafone does not
keep pace with the low carbon products and services offered by
competitors, or rising business customer expectations for adhering
to climate-related requirements.
Time horizon: Medium term
(6) Greenwashing risk: Misleading claims about the environmental
impact of Vodafone (at a corporate reporting or brand communications
level) or its products and services (at a product marketing level) could
result in reputation damage, loss of revenues or possibly legal costs.
Time horizon: Medium term
Transition opportunity
(7) Customer enablement: Revenue growth from the design and
deployment of green digital solutions that enable business
customers to reduce their own GHG emissions, as they seek
technology solutions to support their own climate transition.
Time horizon: Medium term
Note:
1. As described in the Risk Management section of this report, these climate-related risks
and opportunities have been prioritised based on their potential severity, likelihood and
time horizon relative to the full range of climate-related risks and opportunities identified
through our risk analyses. Their prioritisation does not indicate the significance of the risk
or opportunity relative to other risk categories, nor does it indicate the significance of any
impact on Vodafone’s financial position. We therefore refer to these as our ’priority’,
rather than ‘material’ risks.
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Climate-related risk (continued)
Our exposure to risks and opportunities across a
range of scenarios
We analysed our risks and opportunities across a range of scenarios:
early policy action (<2°C), late policy action (<2.5°C), and no policy
action (<4°C). These scenarios are applied to our assessment of
climate-related risk in both Europe and Africa.
Description and degree
of warming by 2100
above pre-industrial
levels
Physical scenarios
Transition scenarios
Early policy
action: smooth
transition
<2°C
Representative
Concentrated Pathway
(‘RCP’) 2.6
(emissions reduce to
limit global warming to
1.6°C by 2100)
Paris ambition scenario
Late policy
action: disruptive
transition
<2.5°C
(Physical risks were
analysed over the range
from <2°C to <4°C,
therefore this specific
scenario was not used in
our analysis)
Stated policy scenario
(in line with the latest
international agreement
on climate change)
No policy action:
business as usual
<4°C
RCP 8.5
(emissions continue to
grow, leading to global
warming of 4.3°C by 2100)
No policy scenario
Time horizon
Physical scenarios
Link to business-planning horizons
Short term
0 to 3 years
(to 2027)
Aligns with our enterprise risk
management framework and
long-range business-planning cycle
Medium term
3 to 5 years
(to 2029)
Aligned with timeframes used for
internal planning purposes
Long term
5 to 26 years
(to 2050)
Aligned with planning horizons for
long-lived infrastructure assets, in
line with global targets for reaching
net zero
Category
Description
Our scenario analysis approach
Physical risks
Risks related to the
physical impacts of
climate change, both
event driven (acute) and
longer-term (chronic)
shifts in climate patterns,
and which may have
financial implications for
companies
High-level qualitative
scenario analysis (2024)
High-level quantitative
analysis, focused on
selected infrastructure
asset types in at high
risk (2022-2023; 2024)
Transition risks
Growing external
pressures to transition to
a lower-carbon economy
result in changes to the
regulatory or market
environment, in ways that
could negatively impact
company costs, revenue
or market share
High-level qualitative
scenario analysis (2024)
Opportunities
A shifting business
landscape in a net zero
world opens new market
and investment
opportunities
High-level qualitative
scenario analysis (2024)
Early policy action (<2°C)
In the early policy action scenario, we foresee that physical risks
increase but remain broadly manageable within the operating
boundaries of our current business model and network infrastructure
(which has already built in a level of climate resilience), and with
limited or minor cost incurred. Our analysis indicates that in Europe a
relatively small proportion (6.6%) of our network assets could be at
high or very high risk of damage from climate perils that could incur
more significant cost. Transition risks, if left unmitigated, could
materialise into business impacts within the short to medium term
(within the next five years), potentially incurring increased operating
costs, costs to comply with regulation, loss of revenue from business
customers and reputational damage. However, the severity of these
impacts is unlikely to be financially material. The potential
commercial value creation from capturing the growing market for
green digital solutions is greatest in this scenario, as industries seek to
decarbonise in response to policy and market incentives.
Late policy action (<2.5°C)
In the late policy action scenario, we can expect physical impacts of
climate change to be more severe and frequent, incurring higher
costs and disruption to operations and supply chains. Some transition
risks would materialise, for the most part within the medium term, in
relation to increasing regulatory and compliance costs and increasing
expectations from business customers for sustainable products and
services.
No policy action (<4°C)
In the no policy action scenario, our exposure to physical risks in
Europe increases marginally, with an estimated 7.0% of our network
assets at high or very high risk of damage from climate perils such as
storms and heavy precipitation, which could cause damage to our
network assets or operational disruption. The exposure of our own
operations to physical risks could be more severe in Africa, where
temperature increases could be 1.5 to 2 times the average global
temperature increase. This scenario also results in the greatest
physical climate change impacts for our supply chains, which could
result in increased cost or supply chain disruption (particularly where
the production of goods is concentrated in geographies vulnerable to
climate change). Transition risks are lowest in this scenario. There may
be market growth opportunities in this scenario as customers seek
technology solutions to help adapt to physical changes in the climate.
Building climate resilience into our business strategy
As a fixed and mobile network operator, we have a large number of
assets and infrastructure spread over a wide geographical area in all
of the markets in which we operate. This means that our business is
exposed to climate change impacts and transition risks across Europe
and Africa.
However, our analysis indicates that Vodafone’s underlying business
model is relatively resilient to climate-related risk. Vodafone’s physical
risk exposure is not expected to result in significant cost or asset
impairment, with a relatively limited range of impacts expected across
the range of scenarios analysed, particularly in Europe. This is partly
due to the level of resilience that is already built into our network
infrastructure and because the majority of our assets (such as radio
equipment) are relatively short-lived with opportunity to adapt our
network as part of our routine end-of-life equipment replacement
programme. However, more widespread operational disruption (within
both our own operations and in our value chain) due to extreme
weather events and extreme heat can be expected over the medium
to long term in the no policy action scenario, particularly in Africa.
Across the scenarios, transition risks are unlikely to result in financially
material impacts. We intend to undertake further quantitative scenario
analysis of our highest priority transition risks to reinforce these
conclusions.
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Currently, Vodafone has insurance arrangements in place to cover
loss or damage to assets from a range of natural disasters and
weather-related events such as flooding, fires and storms (although
the policies do not specifically refer to these as climate-related
events). In recent years, we note that insurance claims have been
made to cover damage to infrastructure. For example, in relation to
flooding in Germany and wildfires in Greece and Portugal, these
claims relate mostly to damage to our mobile access base station
network, rather than our higher value assets, such as data or
technology centres, and are not considered to be financially material
at this stage. Based on our analyses to date, we have not identified
any material financial risks relating to the cost or availability of
insurance as a result of climate change.
There are opportunities for value creation across the range of
scenarios. In both the early and late policy action scenarios, there is
potential for commercial growth from the sale of digital solutions that
can help our customers to decarbonise their businesses. Whereas the
no policy action scenario presents growth opportunities from sale of
digital solutions that help our customers adapt to more extreme
physical changes in the climate.
Our CTP incorporates the management actions required to build
resilience into our business in response to Vodafone’s priority
climate-related risks and opportunities. Our latest analysis, outlined in
this report, has informed the transition plan activities that have been
integrated into our long-range business and financial planning cycle.
Governance and accountability have been put in place to monitor and
manage the implementation of the transition plan.
Click to read our Climate Transition Plan:
www.vodafone.com/ctp
Resilience to physical risks
Protecting our infrastructure assets from being damaged or disrupted
by climate-related weather events is central to the climate resilience
of our business and network services. Mitigation measures are built
into the key stages of each asset’s life cycle, from acquisition to
maintenance, and cover climate adaptation as well as damage
response. During the acquisition of assets, including buildings and
network equipment, we have policies and guidance in place to
incorporate the assessment of environmental risks. Our internal
technology resilience policy requires each asset to conduct a physical
risk assessment annually, which includes evaluating environmental
risks. We also have reactive measures related to asset maintenance in
place, such as processes and teams dedicated to disaster recovery
and business continuity. Lastly, we have insurance policies designed
to transfer any significant financial impact of physical risks, which
cover claims on asset loss and damage.
Building resilience into our operations and network infrastructure is a
well-established part of our business-as-usual process, irrespective of
whether climate change has been explicitly named as a primary risk
driver. We intend to continue to build resilience to the physical risks of
climate change and intend to integrate any additional high-priority
climate adaptation actions beyond our current planning,
procurement, network resilience and business continuity practices
into our CTP over the coming year.
Resilience to transition risks
Decarbonising our business model and improving energy efficiency
will help to minimise our exposure to transition risks. We have set
targets to reduce greenhouse gas (‘GHG’) emissions from our own
operations and to become net zero across our full value chain by
2040 (including at least 90% absolute emission reduction, with any
remaining emissions neutralised through high quality carbon
offsetting).
Read more about our Protect the Planet goals and strategy
on pages 38 to 42
Our CTP includes workstreams on:
– Climate-related policy – to formalise the role of our public
affairs, legal and tax teams in identifying, monitoring and
responding to the ever-evolving landscape of climate-related
policy and regulation.
– Power purchase agreements – to limit exposure to energy
price volatility by increasing the proportion of renewable
electricity purchased through power purchase agreements
(‘PPAs’) as part of our energy procurement strategy.
– Transition plan reporting – to manage our exposure to
reputational risks such as greenwashing, by communicating
clearly and transparently on our climate strategy and continuing
to implement strong governance over the use of environmental
claims in our brand, marketing and corporate communications.
Realising opportunities
Our most significant climate-related opportunity relates to developing
new product lines to enable our enterprise customers to reduce GHG
emissions, improve resource efficiency and protect or enhance
nature. This enablement effect is a key pillar of our Planet strategy.
Read more about our approach to enablement
on page 41
Our CTP includes a workstream on ‘sustainability by design’. This is to
develop and deploy more green digital solutions, such as IoT
solutions for smart cities, buildings or lower-carbon transport and
mobility, that can help our customers manage their environmental
impact, whilst also minimising the negative environmental impact from
the production of our products and services.
Risk management
The management of climate-related risks follows the process defined
by our enterprise risk management framework, which is defined
centrally and implemented in each of our markets. Our approach to
climate-related risk assessment is outlined below.
(1) Identify
To identify potential climate-related risks and opportunities, we review
the relevant sources of information such as media articles, publications,
industry peer disclosures and industry white papers, in addition to reviewing
our previous years’ analyses. We engage with relevant internal and external
experts to gather views on the evolving nature of climate-related risks
for the telecommunications sector and examples of any climate
change impacts that might already be materialising.
(2) Measure
We assess the likelihood and severity of impact for each risk and
opportunity identified. We simulate how the risks and opportunities
could materialise over three time horizons, across a range of possible
future scenarios. We review our scenarios analysis annually to reflect
the most up-to-date information on climate-related trends.
Read more about our definitions for scenarios and time horizons
on page 66
In assessing the severity of an impact, we consider the relative extent
of the potential financial impact through business value drivers such
as increased costs, loss of revenue, asset impairment and damage to
brand or corporate reputation. In assessing the likelihood of an impact,
we consider the potential probability that it will materialise based on
current trends, forecasts and projections and levels of uncertainty.
We have conducted a quantitative scenarios analysis for physical risks
in both Europe and Africa. For transition risks and opportunities, their
severity and likelihood has been assessed qualitatively across our
selected scenarios and time horizons.
We are working towards estimating the financial value at stake from
climate-related risks across our global business, which will depend
upon the completion of a fully quantitative scenarios analysis for both
physical and transition risks. We aim to complete this quantitative
scenarios analysis (including transition risks) within the coming year.
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Climate-related risk (continued)
Our approach to climate-related risk assessment in Africa
Vodacom Group publishes a standalone report disclosing details
of our climate-related risk and opportunity assessment for our
markets in Africa.
Click to read Vodacom Group’s latest TCFD report:
vodacom.com/reporting-centre
Our 2023 analysis confirmed that our markets in Africa will be
exposed to increased occurrence and severity of extreme weather
events – with impacts already being felt today. Climate perils
include increasing temperatures, drought conditions and
increased rainfall, storm surges and cyclonic activity. For example,
in March 2023 Cyclone Freddy (one of the most powerful and
longest-lasting cyclones that has impacted Mozambique since the
beginning of 2022) impacted our operations, workforce and assets.
Similarly, Vodacom’s climate-related risk and opportunity analysis
confirms that our business will be affected by transition risks in relation
to evolving stakeholder expectations, policies and market evolution.
Our approach to physical risk assessment in Europe
This year, we completed a quantitative scenarios analysis of
physical climate risks in Europe, which we commenced in 2022.
Overall, this assessment involved screening over 650 assets across
Spain, Italy, the UK, Germany and Greece, under both RCP 2.6
(early policy action scenario) and RCP 8.5 (no policy action
scenario), to identify assets at ‘high’ or ‘very high’ risk of damage.
We screened assets from three categories of our infrastructure
asset portfolio, which are considered critical to our operations:
– Low-rise structures such as offices and bunkers;
– Control room assets such as technical buildings, warehouses
and data centres; and
– Station assets such as railway stations.
The impact on the assets was assessed in relation to the following
eight climate perils:
1. Coastal inundation
2. River flood
3. Surface-water flood
4. Extreme heat
5. Extreme wind
6. Wildfire
7. Freeze thaw
8. Drought-driven subsidence
The nature and likelihood of the impact of the climate perils was
modelled at a granular resolution based on external climate data
sets, overlaid with the geolocation of each asset.
The magnitude of the potential impacts was assessed based on
the potential value at stake in terms of:
– Damage ratio (average proportion of damage to an asset in a
given year);
– Expected cost of damage (financial cost of remedying damage
sustained); and
– Failure probability (annual probability of a climate hazard
causing the asset to stop working).
Between 6.6% and 7.0% of analysed sites were identified as being
at ‘high’ or ‘very high’ risk of damage from climate perils by 2050
(rising to 7.2% to 8.1% by 2100), defined as:
– High: Expected cost of damage notable, with potential cost
implications; and
– Very high: Widespread damage/disruption.
The majority of value at stake resulting from climate perils across
the asset portfolio is associated with the top 10 at-risk assets.
Five of the assets at ‘high’ or ‘very high’ risk were selected for a
deep dive analysis of potential operational and financial impacts,
to understand the potential drivers of financial loss and mitigation
actions. The most significant drivers contributing to the expected
cost of damage for these assets were coastal inundation and
riverine flooding. By 2100, in the scenario with no policy action, all
five sites were also expected to be at high risk of operational
failure due to extreme heat events.
Findings from our 2022 physical risk assessment were reinforced
by an additional study of physical risks conducted during FY24
with a particular focus on understanding implications for insurance
of over 80 of our highest value assets. This year’s most recent
study concurred with the findings of our 2022 physical risk
assessment, highlighting the increased risk of flooding and
heatwaves that could impact our operations in the long term.
Our approach to transition risk assessment
In FY24, we conducted qualitative scenarios analysis of transition
risks across our global business, including both Europe and Africa.
Based on desk research, industry peer comparison and expert
insights, we identified 67 risks and opportunities that could be
relevant to Vodafone Group. We shortlisted 28 of these for further
analysis based on a preliminary screening of their relative potential
severity, likelihood and time horizon of impact.
Using insights from internal engagement with cross-functional
stakeholders, the shortlist was synthesised into seven priority risks
and opportunities. Five of which are related to the low carbon
transition, which we consider could reasonably be expected to
affect Vodafone Group’s prospects. Looking across three future
scenarios, we conducted a qualitative analysis of the most
significant transition risks and opportunities.
We mapped out impact pathways to understand how the
climate-related transition risks could lead to outcomes and
impacts on Vodafone and their potential to result in financial
impact (for example, through asset impairment, increased costs or
loss of revenue). This included examining the potential impacts on
our own operations and potential impacts on our suppliers, which
could, in turn, affect the security of supply of goods and services
to Vodafone. We assessed the extent to which the steps in the
impact pathways could occur in a range of scenarios based on
published research of future market, policy and legal and
stakeholder sentiment trends and forecasts.
The results of our qualitative scenarios analysis of transition risks
and opportunities supplement the findings of our 2022
quantitative scenarios analysis of physical risks. In combination,
these provide us with a reasonable and holistic view of how our
highest priority climate-related risks and opportunities could play
out over time.
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(3) Manage
As part of our enterprise risk management framework, climate change
is discussed and prioritised, relative to other risks, during the principal
risk assessment process. During FY24, climate change was
consolidated as a sub-risk of ESG risk, in recognition that climate is
one of several wider ESG risks that we intend to manage holistically.
In addition, this aligns with our internal governance structures for ESG,
which encompass all aspects of our Protecting the Planet and wider
Purpose strategy. ESG risk was considered a watchlist risk, partly due
to the time horizon of climate-related risk being mostly outside the
immediate three-year business planning cycle.
Read more about our ESG governance arrangements
on page 33
We will continue to monitor ESG risk as this agenda continues to
evolve in the coming years. In addition, due to the nature of the
priority climate-related risks to our business and strategy, many
elements are already captured in existing principal risks, such as
extreme weather events leading to technology failure, adverse policy
environment resulting in increased costs or increased energy costs
arising due to adverse changes in macroeconomic conditions. This
approach enables us to capture a more holistic picture of the
climate-related risks, both in the short term and long term.
As required by our risk management framework, once a risk is
identified and assessed, a risk owner is responsible for developing and
implementing the mitigating actions and controls. This year, we
incorporated the key mitigating actions for our highest priority
climate-related risks and opportunities into our CTP and assigned
accountability to leaders in relevant business functions for managing
and monitoring these.
Click to read our Climate Transition Plan
www.vodafone.com/ctp
(4) Assure and monitor
We use a three lines model, as detailed in the Group risk management
framework, when managing risks. Relevant assurance providers, such
as control owners in the first and second line, are responsible for
reviewing the policies, procedures and other relevant information
to check whether the controls are effective and update them
as necessary.
Read more about our Group risk management framework
on pages 57-63
(5) Report
As described in the Governance section of this report, reporting of our
climate-related risks is integrated into our enterprise risk
management framework and processes, which are overseen by ARC.
The Group Risk team reports Vodafone’s principal risks, watchlist risks
and emerging risks to the ExCo and the Board, including any material
climate-related risks that are identified through risk analyses. During
the year, if climate-related risks are identified at operational level,
they are reported to the local risk and compliance committee within
each market and escalated to the Group Risk and Compliance
Committee if required.
Read more about our climate governance arrangements
on pages 64 to 65
Metrics and targets
We have set targets to reduce GHG emissions from both our own
operations and across our full value chain. In FY24, we set region-
specific net zero targets for our operational emissions (Scope 1 and 2)
in recognition that the transition pathway and challenges are
fundamentally different in Europe and Africa. Although our transition
pathways differ by region, we are retaining our overall near-term
science-based target to reduce the emissions from our own
operations (Scope 1 and 2) by at least 90% by 2030 across our global
business, against a FY20 baseline.
The Protecting the Planet section of our Annual Report, together with
our ESG Addendum and Methodology document, details our
approach to measuring and reducing GHG emissions. We measure
and report our Scope 1, 2 and 3 emissions (including all 15 categories
of Scope 3). We also have metrics in place to measure energy use;
one of the key underlying factors in our exposure to climate-related
transition risk.
Read more about our climate metrics and targets
in the Protecting the Planet section on page 38 to 42
Click to read our ESG Addendum:
investors.vodafone.com/esgaddendum
Click to read our ESG Methodology document:
investors.vodafone.com/esgmethodology
Climate-related risk/opportunity metrics
2024
2023
2022
Total Scope 1 and Scope 2 emissions
(market-based) (million tonnes CO2e)1
0.69
0.91
1.02
Scope 3 emissions (million tonnes CO2e)1,2
6.07
6.92
6.91
Energy use (gigawatt hours)1
5,217
5,052
4,926
Carbon enablement (million tonnes CO2e)
32.8
24.9
13.5
Notes:
1. Information relating to 2023 and 2022 has been restated to reflect portfolio changes
completed during FY23 and FY24.
2. Data for 2022 and 2023 has been restated to reflect changes to our methodology for
calculating Scope 3 emissions, see our ESG Addendum Methodology document for more
information: investors.vodafone.com/esgmethodology.
Climate-related considerations are factored into our executive
remuneration, by way of an annual emission reduction target. This is
linked to our near-term science-based target to reduce the emissions
from our own operations (Scope 1 and 2) by at least 90% by 2030
across our global business, against a FY20 baseline. 3.3% of executive
long-term incentive plan is linked to this climate metric. We continue
to explore how we can integrate climate resilience into our reward
structures, objectives and incentives.
Read more about how ESG is incorporated into our remuneration policy
on page 108
We continue to measure our exposure to physical risks, for example,
the percentage of our high-value assets that are vulnerable to
physical risks in Europe.
We report annually on the carbon emissions avoided through the use
of our digital solutions, which we consider to be one of our most significant
climate-related commercial opportunities, known as ‘carbon enablement’.
Click to read more about how we
measure carbon enablement in
our ESG Addendum:
investors.vodafone.com/
esgaddendum
Read more about our targets for
enablement on page 41
Whilst these are important steps forward on our climate-related risk
disclosure journey, we recognise that we have not yet set targets or
put metrics in place to measure our full suite of climate-related
physical and transition risks. We remain committed to setting these
metrics and targets in line with the refreshed list of our priority
climate-related risks and opportunities. The establishment of metrics
and targets will form part of the implementation of our transition plan,
which commenced from 1 April 2024. We intend to develop metrics
and targets within the coming year. Our transition plan also outlines
the areas of uncertainty, dependency on key external factors and risks
to the delivery of our targets.
Currently, we are also considering the opportunity to use an internal
carbon price as part of our decision-making. An internal carbon price
puts a financial value on the climate impact of our business decisions
(such as purchasing goods or undertaking capital projects). We have
begun to explore potential options for an internal carbon price, for
evaluation and possible implementation in future years.
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6
5
2
8
5
3
3
Environmental,
social and
governance
Political/
regulatory
Technology/
telecoms
Media
Emerging
markets
Finance
Consumer
goods and
services/
marketing
Leadership, governance and engagement
Membership and attendance
The table below details the Board and Committee meeting
attendance during the year to 31 March 2024. The number of
attendances is shown next to the maximum number of meetings each
Director was entitled to attend. Ad hoc meetings of the Board and its
Committees were also held as required during the year.
Name
Board
Nominations
and
Governance
Committee
Audit
and Risk
Committee
Remuneration
Committee
ESG
Committee
Technology
Committee
Stephen Carter
7/7
3/41
–
–
–
2/31
Delphine
Ernotte Cunci
7/7
–
–
5/5
–
3/3
Sir Crispin Davis2
2/2
2/2
–
–
–
–
Margherita
Della Valle
7/7
–
–
–
–
–
Michel Demaré
6/73
4/4
4/53
5/5
–
–
Hatem Dowidar4
1/1
1/1
–
–
–
–
Dame Clara Furse2
2/2
–
–
2/2
–
–
Valerie Gooding2
2/2
2/2
–
2/2
–
–
Deborah Kerr
7/7
–
5/5
–
–
3/3
Luka Mucic5
5/5
–
–
–
–
–
Amparo Moraleda
7/7
–
1/16
3/36
2/2
–
David Nish
6/77
2/28
5/5
–
–
–
Christine Ramon
7/7
–
5/5
–
2/29
–
Simon Segars
7/7
–
–
–
1/210
3/3
Jean-François
van Boxmeer
7/7
4/4
–
–
2/211
–
Notes:
1. Stephen Carter was unable to attend one scheduled meeting of the Nominations and
Governance Committee and one scheduled meeting of the Technology Committee due to a
scheduling conflict.
2. Sir Crispin Davis, Dame Clara Furse and Valerie Gooding stepped down from the Board at the
conclusion of the AGM on 25 July 2023.
3. Michel Demaré was unable to attend one scheduled meeting of the Board and one scheduled
meeting of the Audit and Risk Committee due to a scheduling conflict.
4. Hatem Dowidar was appointed as a Non-Executive Director of the Board and joined the
Nominations and Governance Committee on 19 February 2024.
5. Luka Mucic was appointed as Group Chief Financial Officer on 1 September 2023.
6. Amparo Moraleda ceased to be a member of the Audit and Risk Committee and was
appointed Chair of the Remuneration Committee on 25 July 2023.
7. David Nish was unable to attend one scheduled meeting of the Board due to a scheduling conflict.
8. David Nish joined the Nominations and Governance Committee on 25 July 2023.
9. Christine Ramon joined the ESG Committee on 25 July 2023.
10. Simon Segars was unable to attend one scheduled meeting of the ESG Committee due to ill health.
11. Jean-François van Boxmeer joined the ESG Committee on 25 July 2023.
1
9
2
7-10 years
7-10 years
0-3 years
4-6 years
0-3 years
4-6 years
Female
Female
Male
Male
7
5
1
8
2
1
Independent
NED Chair
Independent
NED Chair
Non-independent
Non-independent
Independent
Executive
Independent
Executive
Ethnically diverse
Ethnically diverse
White
White
2023
2022
2021
2020
2019
2018
2017
2016
2015
2024
11
10
10
12
12
11
11
10
10
1
1
11
1
1
2
1
1
2
1
Chair
Chief
Executive
Female
Female
Male
Male
Senior
Independent
Director
Chief Financial
Officer
The Nominations and Governance Committee regularly reviews the Board’s composition with a view
to ensuring a diverse mix of backgrounds, skills, knowledge and experience as well as deep expertise
in technology and telecommunications. Each year, the Board monitors and improves its performance
by conducting an annual performance review.
Tenure
Independence
Gender diversity
Senior Board positions
Ethnicity
Skills and expertise of Non-Executive Directors
Note: As at 31 March 2024
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Committee activities
Board evaluation
Progress in the year
The FY24 Board evaluation reported improvements had been achieved in:
– Leadership: In July 2023, the appointment of Luka Mucic from 1 September 2023
as the Chief Financial Officer was announced. The Nominations and Governance
Committee and the Board have also considered succession planning at a number
of meetings.
– Operational performance: The Board spent a full day in September 2023
focusing on the Group’s three strategic priorities and the initiatives supporting
them. Additional sessions and updates on these initiatives featured in the
remaining FY24 Board meetings including a deep dive into the satellite
strategy and an update on deep detractor reductions.
– Technology: In May 2023, the Board approved the establishment of the
Technology Committee. The Committee has met three times during FY24
and focused on the current technology strategy including deep dives and
the budgeting process for FY24.
Read more on
pages 84-85
Nominations and Governance Committee
In addition to keeping under review developments in corporate
governance and the Company’s responses to them, the Nominations
and Governance Committee makes recommendations to the Board
about Board composition and ensures Board diversity and the necessary
balance of skills. The Committee recognises the need to anticipate
the skills and attributes that will be needed on the Board as the Company
develops. Committee focus during FY24 was on the appointment of
the Group Chief Executive and the Group Chief Financial Officer, the
establishment of the Technology Committee, and Board Committee
composition following the departure of long-standing Non-Executive
Directors at the conclusion of the 2023 AGM. The Committee has also
spent time reviewing the bench strength of management.
Read more on
pages 86-88
Board changes
Luka Mucic joined the Board as Group Chief Financial Officer on 1
September 2023. Luka brings extensive financial and international
business experience. He has a strong record of international
leadership, corporate repositioning and value creation that will
support the strategic aims of the Group.
Click or scan to watch the Group Chief Financial Officer, Luka Mucic, explain
his role: investors.vodafone.com/videos
Technology Committee
The Committee oversees the technology strategy and how it supports
the overall Company strategy. The Committee monitors progress
against the strategy and assesses technology risks and industry
trends. It also keeps technology development under review and
explores innovations that enable future growth.
Click or scan to watch the Chair of the Technology
Committee, Simon Segars, explain his role:
investors.vodafone.com/videos
Read more on
page 95
To operate efficiently and to ensure matters are given the right level of focus, the Board delegates
some of its responsibilities to its Committees. These provide focused oversight on: Board composition,
performance, and succession planning; financial reporting, risk, internal processes and controls;
remuneration practices; environmental, sustainability and governance topics; and technology strategy.
Audit and Risk Committee
The Committee oversees the Group’s financial reporting, risk
management, internal control and assurance processes, and the
external audit. This includes in-depth reviews of our principal risks, the
review of our Annual Report and a programme of deep dives across
multiple business units with a focus on the risk and control
environment. The Committee also monitors the activities and
effectiveness of the internal audit function and has primary
responsibility for overseeing the relationship with the external auditor.
Deep-dive topics during FY24 included reviews of adverse changes in
macroeconomic conditions, disintermediation risk, adverse political and
policy environment, strategic transformation, cyber threats, supply
chain disruption, technology, data management and privacy. Entity
deep-dives included the cluster of markets within the Other Europe
segment, Vodafone Spain, Vodafone Germany, Vodafone UK, Vantage
Towers and Vodafone Business. The Committee also has joint
responsibility, with the ESG Committee, for reviewing the
appropriateness and adequacy of ESG disclosures provided within the
Annual Report and the ESG Addendum, including approving its content.
Click or scan to watch the Chair of the Audit
Committee, David Nish, explain his role:
investors.vodafone.com/videos
Read more on
pages 89-94
ESG Committee
The ESG Committee provides oversight of Vodafone’s Environmental,
Social and Governance (‘ESG’) programme and monitors the purpose
agenda in relation to empowering people, protecting our planet and
ensuring that Vodafone acts with integrity. Committee focus during
the year was on the refreshment of our purpose agenda to create a
digital society. The Committee also reviewed the ESG strategy and its
evolution since the establishment of the Committee in 2021, and
undertook a full review of the ESG reporting disclosures.
Click or scan to watch the Chair of the ESG
Committee, Amparo Moraleda, explain her role:
investors.vodafone.com/videos
Read more on
pages 96-97
Read more on
pages 98-118
Remuneration Committee
The Remuneration Committee sets, assesses and recommends for
shareholder approval the Remuneration Policy for Executive Directors,
sets the remuneration of the Executive Directors and approves the
remuneration of the Chair of the Board and members of the Executive
Committee. It also reviews remuneration arrangements across the
Group to ensure they are aligned with our strategy, support our
purpose and celebrate the ‘Spirit of Vodafone’.
Fair Pay principles:
1. Market-competitive
4. Share in our successes
2. Free from discrimination
5. Provide benefits for all
3. Provide a good standard of living 6. Open and transparent
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Dear shareholders,
On behalf of the Board, I am pleased to present the Corporate
Governance Report for the year ended 31 March 2024.
This report provides details about the Board and an explanation of our
individual roles and responsibilities. It also provides an insight into the
activities of the Board and Committees over the year and how we
seek to ensure the highest standards of corporate governance remain
embedded throughout the Company, underpinning and supporting
our business and the decisions we make.
The year in review
In May 2023, we set out a new roadmap for Vodafone, based on our
need to change and focus on three priorities: Customers, Simplicity
and Growth. Since then we have seen Vodafone’s transformation
progress, and I would like to give great thanks to my fellow Directors,
the executive team, and the people of Vodafone for their spirit,
ambition and hard work. There is much more that needs to be done
for us to achieve our ambition of being a best-in-class telco in Europe
and Africa, as well as the leading platform for business in Europe, but I
am confident we are on the right trajectory.
Strategic Transformation
This financial year has seen a lot of transactional activity for Vodafone.
In May 2023, we announced entering into a strategic partnership and
Relationship Agreement with Emirates Telecommunications Group
Company PJSC (‘e&’), establishing e& as a cornerstone shareholder of
the Company. The strategic relationship enables collaboration across
a broad range of growth areas. Under the terms of the Relationship
Agreement, the Group Chief Executive Officer of e&, Hatem Dowidar,
joined the Vodafone Board as a Non-Executive Director on 19
February 2024. The e& Group Chief Executive will have the right to be
an appointed Non-Executive Director, subject to shareholder approval,
for as long as e& maintains its current shareholding of 14.6%.
In June 2023, we announced entering into a binding agreement with
Hutchison Group Telecom Holdings Limited in relation to a
combination of our UK telecommunication businesses, Vodafone UK
and Three UK. If approved, this merger will be great for customers,
great for the country and great for competition. It is transformative
and will create a best-in-Europe 5G network.
In October 2023, we announced the sale of Vodafone Spain, which we
believe is a key step in right-sizing our portfolio for growth and will
enable us to focus our resources in markets with sustainable
structures and sufficient local scale.
In November 2023, we announced a strategic partnership with
Accenture to accelerate the commercialisation of our shared
operations to advance growth, enhance customer service and drive
significant efficiencies for Vodafone’s operating companies and partner
markets, as well as create new career opportunities for our people.
On 16 January 2024, we signed a 10-year strategic partnership with
Microsoft to bring generative AI, digital services and the cloud to more
than 300 million businesses and consumers.
On 15 March 2024, we announced the sale of Vodafone Italy to
Swisscom AG and a broad review of our capital allocation
considering the investment profile of the Group’s strategy within
its reshaped footprint.
The capital allocation review concluded that country-level capital
intensity would be broadly maintained at existing levels, a robust
balance sheet would be maintained with a new leverage policy, the
ordinary dividend would be rebased to 4.5 eurocents per share
from FY25 onwards, and there would be an opportunity for share
buybacks following the completion of the sale of Vodafone Spain
and Vodafone Italy.
These transactions formed part of Vodafone’s transformational
progress, with the sale of Vodafone Italy being the last step in our
portfolio transformation, helping us to move forward with our
roadmap and achieve our ambition.
Board composition
Executive Directors
Luka Mucic joined the Board as Group Chief Financial Officer on 1
September 2023 following an extensive external recruitment process
with the support of Egon Zehnder, an independent external search
firm. The Board and I have been impressed with the pace with which
Luka has got to grips with the Company and the strong relationship
he and Margherita are building.
The appointment of Luka enabled Margherita Della Valle to fully
transition into her role as Group Chief Executive. During the year,
Margherita has continued to demonstrate her strong capabilities in
being able to lead the necessary transformation of Vodafone.
Non-Executive Directors
As I discussed in last year’s report, there were a number of scheduled
changes in the composition of our Non-Executive Directors expected
during FY24, with the retirement of Valerie Gooding, Sir Crispin Davis
and Dame Clara Furse. David Nish was appointed Senior Independent
Director, Amparo Moraleda was appointed Remuneration Committee
Chair and Delphine Ernotte Cunci and Christine Ramon were
appointed Workforce Engagement Leads.
Following Hatem Dowidar’s appointment earlier this year, he has
begun a full induction programme, including meetings with
executives leading our businesses and functions.
The Board and Nominations and Governance Committee anticipate
scheduled retirements in FY25 and, therefore, already have a renewed
focus on succession planning. We will continue to closely monitor the
diversity and skill sets needed to drive the Company forward.
Diversity
Our commitment to having a Board diverse in all aspects firmly
remains. The Nominations and Governance Committee continues to
support the Board in monitoring requirements and best practices. We
are proud to meet gender targets requiring Boards to comprise of at
least 40% women. This includes our Group Chief Executive,
Margherita Della Valle. We also exceed the Parker Review target to
have at least one Director from a minority ethnic group.
Beyond the Board, you may recall that last year we announced the
introduction of a new ethnic diversity target, for 25% of our global
senior leadership to be from ethnically diverse backgrounds by 2030.
We are making great progress towards this target.
Skills
The changes in composition in the year have bolstered the Board and
demonstrated that diversity, skills and knowledge are effectively
regarded when composition is considered. The Board and I believe
our composition, with highly relevant sector expertise, makes us well
placed to advise and provide management oversight.
On 10 May 2023, the Board approved the creation of a Technology
Committee to oversee the technology strategy and how it supports
the overall Company strategy. The Committee was established on 25
July 2023 and has already proved to be a significant enhancement to
our governance structure.
Evaluation
For the second year in a row, the Board undertook an internal
evaluation which I led with support from the Group General Counsel
and Company Secretary. Individual Directors were invited to complete
a self-assessment questionnaire as well as speaking with me
We take our commitment to strong and robust
corporate governance seriously
Chair’s governance statement
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Other information
Compliance with the 2018 UK Corporate
Governance Code (the ‘Code’)
In respect of the year ended 31 March 2024, Vodafone Group Plc
was subject to the Code (available from www.frc.org.uk). The Board
is pleased to confirm that Vodafone applied the principles and
complied with all the provisions of the Code throughout the year.
Further information on compliance with the Code can be found as follows:
one-on-one. In a change from prior years, response was also sought
from the Group General Counsel and Company Secretary. I am
delighted to report there was a clear consensus that the Board is
very effective in working together as a cohesive unit and continues
to improve following the changes made during the year. A number of
strengths were identified as well as key areas for focus during the
year ahead.
Executive Committee composition
With effect from 1 April 2024, we made a number of changes to our
Executive Committee. Ahmed Essam was appointed Executive
Chairman Vodafone Germany and CEO European Markets, Serpil
Timuray was appointed CEO Vodafone Investments, and Philippe
Rogge stood down from his role as CEO Vodafone Germany and as a
member of the Group Executive Committee, leaving Vodafone. Marcel
de Groot was appointed CEO Vodafone Germany and Max Taylor
appointed CEO Vodafone UK. Both Marcel and Max report to Ahmed
Essam but are not members of the Executive Committee,
Marika Auramo has been appointed CEO of Vodafone Business and a
member of Vodafone’s Executive Committee, with effect from 1 July
2024. Marika will take over from Giorgio Migliarina, who has
successfully led Vodafone Business as interim CEO since Vinod
Kumar’s departure on 31 December 2023.
Stakeholder engagement
The Board is committed to understanding the views of all of
Vodafone’s stakeholders to inform the decisions that we make. We
recognise that Vodafone’s success is dependent on the Board taking
decisions for the benefit of our shareholders and in doing so having
regard to all our stakeholders.
Throughout the year, I have met with institutional shareholders both
virtually and in person. In March 2024, I had individual meetings with a
number of the Company’s largest shareholders and engaged on
topics such as capital allocation, Board composition and the shape of
the Group. Further resources were made available to individual
shareholders during the year, such as online presentations hosted by
the UK Individual Shareholders Society. I have also met senior political
leaders in both my role as Vodafone Chair and as the Chair of the
European Round Table for Industry. These include presidents and
prime ministers across our markets and in key international organisations
such as the European Commission. The Board received an update on
the investor perception study completed during the year.
The Board understands the importance of culture and setting the
tone of the organisation from the top and embedding it throughout
the Group. We refer to our culture as the ‘Spirit of Vodafone’. It is a key
component of our strategic, organisational and digital transformation.
The aim of our people strategy is to create an environment where
growing never stops and everyone can truly belong, innovate and
fulfil their potential. The Board receives regular updates on employee
engagement and the ‘Spirit of Vodafone’, which enables it to make
informed decisions where appropriate.
During the year, in their roles as Workforce Engagement Leads,
Delphine Ernotte Cunci and Christine Ramon gathered the views of
employees through employee consultative committees across our
European and African markets. Key discussion topics included
customer experience, and personal development and reskilling
opportunities.
The Annual General Meeting (‘AGM’) in 2023 was held at Vodafone UK’s
headquarters in Newbury, Berkshire and was available to watch live via a
webcast for those shareholders who were unable to attend in person.
Shareholders were able to pre-submit questions or, if attending in
person, ask questions on the day, for consideration by the Directors at
the meeting. We intend to hold the 2024 AGM in the same format.
Click to read more about the AGM:
vodafone.com/agm
Disclosure Guidance and Transparency Rules
We comply with the Corporate Governance Statement requirements
pursuant to the FCA’s Disclosure Guidance and Transparency
Rules by virtue of the information included in this ‘Governance’
section of the Annual Report together with information contained
in the ‘Shareholder information’ section on pages 249 to 254.
Board leadership and Company purpose
Read more
Long-term value and sustainability
32-56, 63
Culture
15-20, 44, 80
Shareholder engagement
12-14, 73, 82
Other stakeholder engagement
12-14, 73, 80, 82
Conflicts of interest
87
Role of the Chair
75
Division of responsibilities
Non-Executive Directors
75-78
Independence
70, 87
Composition, succession and evaluation
Appointments and succession planning
71-72, 86, 88
Skills, experience and knowledge
70, 72, 76-78
Length of service
70, 76-78
Evaluation
71-73, 84-85
Diversity
15-16, 70, 72, 83, 87-88
Audit, risk and internal control
Committee
89-94
Integrity of financial statements
63, 90-94, 124
Fair, balanced and understandable
91, 123-124
Internal controls and risk management
93
External auditor
94
Principal and emerging risks
57-69, 90, 93
Remuneration
Policies and practices
98-118
Alignment with purpose, values and
long-term strategy
98-118
Independent judgement and discretion
99, 101, 107
The year ahead
A key focus for the Board and I for FY25 will be on succession
planning in anticipation of upcoming scheduled retirements,
whilst also continuing to support Luka, Margherita and Hatem in
their new roles.
In addition, the Board will continue to drive for sustainable value
creation and monitor the Company’s progress on the execution of
Vodafone’s strategy focusing on Customers, Simplicity and Growth.
The Board will keep the Group’s strategy under review, adapting it to
anticipate or respond to opportunities and risks in the markets in
which we operate.
Thank you for your continued support.
Jean-François van Boxmeer
Chair of the Board
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Our governance structure
The Board
Responsible for the overall conduct of the Group’s business including: our long-term success; setting our purpose; monitoring culture, values, standards and
strategic objectives; reviewing our performance; and maintaining positive dialogue with our stakeholders. The Board has established five formal Committees
to focus on specific areas. These are outlined in further detail below:
Governance
Executive Committee
Focuses on strategy implementation, financial and competitive performance, commercial and
technological developments, succession planning and organisational development.
The Committee has established a number of additional management committees including:
Click to read more about
the Executive Committee:
vodafone.com/exco
– Disclosure Committee
– Risk and Compliance Committee
– ESG and Reputation Steering Committee
The Board
The Board comprises the Chair, Senior Independent Director,
Non-Executive Directors, the Group Chief Executive and the Group
Chief Financial Officer. Our Non-Executive Directors bring
independent judgement, and wide and varied commercial, financial
and industry experience to the Board and Committees.
A summary of each role can be found overleaf on page 75
Biographies of Board members can be found on pages 76-78
Board meetings are structured to allow open discussions. At each
meeting, the Directors are made aware of the key discussions and
decisions of the principal Committees by the respective Committee
Chairs. Minutes of Board and Committee meetings are circulated to all
Directors after each meeting.
Read more about the Board’s activities during
the year on pages 81-83
The Board is collectively responsible for ensuring leadership through
effective oversight and review. It sets the strategic direction with the
goal of delivering sustainable stakeholder value over the longer term
and has oversight of cultural and ethics programmes. The Board’s
responsibility includes delivery of strategy and business performance.
The Board also oversees the implementation of risk assessment
systems and processes to identify, manage and mitigate Vodafone’s
principal risks. It is also responsible for matters relating to finance,
audit and internal control, reputation, listed company management,
corporate governance, remuneration and effective succession
planning, much of which is overseen through its principal Committees.
The Executive Committee
The Executive Committee comprises Margherita Della Valle, the
Group Chief Executive, and Luka Mucic, Group Chief Financial Officer,
together with a number of senior executives responsible for global
commercial operations, human resources, technology, external affairs
and legal matters. Committee members also include the Executive
Chairman Vodafone Germany and CEO European Markets, CEO
Vodafone Investments, CEO Vodacom Group, and Chief Commercial
Officer and CEO Vodafone Italy.
Led by the Group Chief Executive, the Executive Committee and other
management committees are responsible for making day-to-day
management and operational decisions, including implementing
strategic objectives and empowering competitive business
performance in line with established risk management frameworks,
compliance policies, internal control systems and reporting
requirements.
Details of the Executive Committee members and their range of
experience, skills and expertise can be found on page 79. Some
members also hold external non-executive directorships, giving
them valuable board experience.
Biographies of the Executive Committee
can be found on page 79
Click to read more about the responsibilities of each Board Committee:
vodafone.com/board-committees
Nominations and
Governance
Committee
Evaluates Board
composition and
ensures Board
diversity and a
balance of skills.
Reviews Board and
Executive Committee
succession plans to
maintain continuity
of skilled resources.
Oversees matters
relating to corporate
governance.
ESG Committee
Oversees the ESG
programme and
monitors the purpose
agenda in relation to
empowering people,
protecting our planet
and ensuring that
Vodafone acts with
integrity.
Monitors progress
against key
performance
indicators and
external ESG index
results.
Oversees progress on
ESG commitments
and targets.
Technology
Committee
Supports the Board with
fulfilling its oversight of
the Company, specifically
how technology
underpins Company
strategy, including
assessing risks and
exploring innovations for
future growth.
Monitors technology
development, innovation,
risks, disruptors and
mitigations.
Reviews technology
supply chains,
partnerships and external
relationships.
Remuneration
Committee
Sets, reviews and
recommends the policy
on remuneration of the
Chair, executives and
senior management
team.
Monitors the
implementation of the
Remuneration Policy.
Oversees general pay
practices across the
Group.
Audit and Risk Committee
Reviews the adequacy of the
Group’s system of internal
control, including the risk
management framework and
related compliance activities.
Monitors the integrity of financial
statements, reviews significant
financial reporting judgements,
and advises the Board on fair,
balanced and understandable
reporting and the long-term
viability statement.
The Committee also has joint
responsibility, with the ESG
Committee, for reviewing the
appropriateness and adequacy
of ESG disclosures provided
within the Annual Report and
the ESG Addendum, including
the approval of their content.
– AI Governance Board
– Simplicity Board
– Capital Decision Board
– Business Decision Board
– National Security Committee
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Division of responsibilities
Chair
Jean-François van Boxmeer
– Leads the Board, sets each meeting agenda and ensures the Board
receives accurate, timely and clear information in order to monitor
and challenge management, guiding them and the Board to take
sound decisions;
– Promotes a culture of open debate between Executive and
Non-Executive Directors and holds meetings with the Non-
Executive Directors without the Executive Directors present;
– Regularly meets with the Group Chief Executive and other senior
management to stay informed;
– Ensures effective communication with shareholders and other
stakeholders;
– Promotes high standards of corporate governance and ensures
Directors understand the views of the Company’s shareholders and
other key stakeholders, and the section 172 Companies Act 2006
duties;
– Promotes and safeguards the interests and reputation of the
Company; and
– Represents the Company to customers, suppliers, governments,
shareholders, financial institutions, the media, the community
and the public.
Senior Independent Director
David Nish
– Provides a sounding board for the Chair and acts as a trusted
intermediary for the Directors as required;
– Meets with the Non-Executive Directors (without the Chair present)
when necessary and at least once a year to appraise the Chair’s
performance, and communicates the results to the Chair; and
– Together with the Nominations and Governance Committee, leads
an orderly succession process for the Chair.
Workforce Engagement Leads
Delphine Ernotte Cunci and Christine Ramon
– Engage with the workforce in key regions where the Group
operates, answer direct questions from workforce-elected
representatives, and provide the Board with feedback on the
content and outcome of those discussions.
Non-Executive Directors
– Monitor and challenge the performance of management;
– Assist in development, approval and review of strategy;
– Review Group financial information and provide advice to
management;
– Engage with stakeholders and provide insight as to their views,
including in relation to the workforce and the culture of Vodafone;
and
– As part of the Nominations and Governance Committee,
review the succession plans for the Board and key members
of senior management.
Company Secretary
Maaike de Bie
– Ensures the necessary information flows between the Board and
Committees, and between senior management and Non-Executive
Directors, in a timely manner;
– Supports the Chair in ensuring the Board functions efficiently and
effectively, and assists the Chair with organising Director induction
and training programmes;
– Provides advice and keeps the Board updated on all corporate
governance developments; and
– Is a member of the Executive Committee.
Group Chief Executive
Margherita Della Valle
– Provides leadership of the Company, including representing the
Company to customers, suppliers, governments, shareholders,
financial institutions, employees, the media, the community and
the public, and enhances the Group’s reputation;
– Leads the Executive Directors and senior management team in
running the Group’s business, including chairing the Executive
Committee;
– Develops and implements Group objectives and strategy having
regard to shareholders and other stakeholders;
– Recommends remuneration, terms of employment and succession
planning for the senior executive team;
– Manages the Group’s risk profile and ensures appropriate internal
controls are in place;
– Ensures compliance with legal, regulatory, corporate governance,
social, ethical and environmental requirements and best practice;
and
– Ensures there are effective processes for engaging with,
communicating with, and listening to, employees and others
working for the Company.
Chief Financial Officer
Luka Mucic
– Supports the Chief Executive in developing and implementing the
Group strategy;
– Leads the global finance function and develops key finance talent;
– Ensures effective financial reporting, processes and controls
are in place;
– Recommends the annual budget and long-term strategic and
financial plan;
– Oversees Vodafone’s relationships with the investment community;
and
– Leads on supply chain management, including the Vodafone
Procurement Company.
Click to read more about the Board’s role
and responsibilities, matters reserved
and the terms of reference for each Board
Committee: vodafone.com/board
Read more about our Board
Committees, together with
details of their activities,
on pages 86-118
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Other information
Governance (continued)
Our Board
Committee key
A
Audit and
Risk Committee
E
ESG Committee
N
Nominations and
Governance Committee
R
Remuneration
Committee
T
Technology
Committee
Solid background signifies
Committee Chair
Our business is led by our Board of Directors.
Biographical details of the Directors as at 14 May
2024 are provided below.
Click to find full biographical information for the Directors:
vodafone.com/board
External appointments listed are only those required to be disclosed
pursuant to Listing Rule 9.6.
Jean-François van Boxmeer N E
Chair – Independent on appointment
Tenure: 3 years
Career and experience:
Jean-François was the Chief Executive of Heineken for 15 years, having
been with the company for 36 years. Jean-François held a number of
senior roles in Africa and Europe before joining Heineken’s Executive
Board in 2001 with worldwide responsibility for supply chain and
technical services, as well as regional responsibility for the operating
businesses in North-West Europe, Central and Eastern Europe and
Sub-Saharan Africa.
Skills and attributes which support strategy and long-term success:
– Extensive international experience in driving growth through both
business-to-business and business-to-consumer business models,
both of which are integral components of the Company’s strategy
and long-term success.
– Exposure to overseeing the management of complex and
far-reaching transformational projects, including specific hands-on
experience of the countries in which the Company operates.
– Skilled communicator with a strong track record of developing
stakeholder relations and overseeing governance in the context of
a large global organisation, which, in his capacity as Chair of the
Board, continues to be of great value to the Company.
External appointments:
– Heineken Holding N.V., non-executive director
Margherita Della Valle
Group Chief Executive – Executive Director
Tenure: 1 year (as Group Chief Executive)
Career and experience:
In addition to her role as Group Chief Financial Officer which she held since
2018, Margherita Della Valle was initially appointed Group Chief Executive
on an interim basis, effective 1 January 2023. On 27 April 2023, we
announced the permanent appointment of Margherita as Group Chief
Executive with immediate effect. Margherita continued to serve as Group
Chief Financial Officer until Luka Mucic was appointed on 1 September
2023. Margherita’s previous roles within Vodafone were Deputy Chief
Financial Officer from 2015 to 2018, Group Financial Controller, Chief
Financial Officer for Vodafone’s European region and Chief Financial Officer
for Vodafone Italy. She joined Omnitel Pronto Italia – which later became
Vodafone Italy – in 1994 and held key senior positions in consumer,
marketing, business analytics and customer base management before
moving to finance. After moving to a Group finance position in 2007,
Margherita established a number of shared operations functions, which
now employ over 31,700 people and provides a portfolio of services
spanning IT operations, customer care, supply chain management, human
resources and finance operations to 28 partners in other markets.
Skills and attributes which support strategy and long-term success:
– Strong commercial and operational leadership with expert
knowledge of the global telecommunications landscape after close
to three decades of direct industry experience.
– Considerable corporate finance and accounting experience,
translating into expert knowledge of capital allocation, operational
efficiency and investment appraisal.
– After almost 30 years at Vodafone, Margherita has a strong
personal affiliation and understanding of the Company’s culture
and values, which help her represent the Company to all
stakeholders and develop and implement the strategy.
– Proven record of developing the next generation of talent,
including senior leadership within Vodafone and more broadly
through her founding of NXT GEN Women in Finance, an initiative
where European Chief Financial Officers identify, mentor and
promote rising female stars in finance.
External appointments:
– Reckitt Benckiser Group plc, non-executive director and member of
the audit committee
Luka Mucic
Group Chief Financial Officer – Executive Director
Tenure: <1 year
Career and experience:
Luka was appointed Group Chief Financial Officer and a member of the
Vodafone Group Plc Board on 1 September 2023. Previously Luka was
the Chief Operating Officer of SAP SE from 2014-2017 and its Chief
Financial Officer from 2014 until 31 March 2023. During these roles, he
was responsible for SAP’s groupwide finance, legal, data protection,
procurement, audit, risk management, security, IT, and process
management functions. Luka began his career at SAP in 1996 and has
held a series of management positions within the global finance and
administration division. He assumed responsibility for M&A projects, as
well as for the global risk management function of SAP and the legal
department of SAP Markets Europe. After serving as CFO of SAP’s DACH
region (comprising Germany, Austria and Switzerland) from 2008 to
2012, he became Head of Global Finance and a member of SAP’s
Global Managing Board in 2013. Luka also oversaw SAP’s sustainability
efforts and was responsible for SAP’s Taulia and SAP Signavio business
units.
Skills and attributes which support strategy and long-term success:
– Strong commercial and operational leadership with expert
knowledge of the global finance landscape.
– A background in finance, legal, audit, risk management and IT allow
Luka to be a balanced and highly knowledgeable Executive
Director in technical Board discussions.
External appointments:
– Heidelberg Materials AG, supervisory board member
Stephen A. Carter CBE N T
Non-Executive Director
Tenure: 1 year
Career and experience:
Since becoming Group CEO of Informa plc in 2013, Stephen has led
Informa plc through a transformation into an international leader in
B2B events, digital services and academic markets. Prior to Informa,
Stephen was President and Managing Director at Alcatel-Lucent,
where he played a key role in restructuring the business, and
investing in next-generation mobile network equipment and product
development delivery. Stephen also served a term as the founding
CEO of Ofcom, the UK’s telecommunication regulator, where he
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Committee key
A
Audit and
Risk Committee
E
ESG Committee
N
Nominations and
Governance Committee
R
Remuneration
Committee
T
Technology
Committee
Solid background signifies
Committee Chair
brought together five different regulatory authorities. After Ofcom,
Stephen served as Chief of Strategy to the UK’s Prime Minister, and
then as a Minister of State for Communications, Technology &
Broadcasting. Stephen later served as a non-executive director for the
Department for Business, Energy and Industrial Strategy from
2016-2020.
Skills and attributes which support strategy and long-term success:
– Track record of value creation, with specific experience in the
telecoms and media sectors.
– Experience in public policy, government affairs and regulatory
engagement, which is invaluable in relation to the highly regulated
environment within which the Company operates.
External appointments:
– Informa plc, group chief executive
Michel Demaré A N R
Non-Executive Director
Tenure: 6 years
Career and experience:
Michel began his career at Continental Bank SA, Belgium, before
spending 18 years with The Dow Chemical Company in several finance
and strategy responsibilities in Benelux, France, the US and Switzerland.
He was Chief Financial Officer Europe for Baxter International from
2002 to 2005, and Chief Financial Officer at ABB Group from 2005 to
2013. He also served as Interim CEO of ABB during 2008. He was
independent vice-chairman at UBS Group from 2009 to 2019, and
vice-chairman/chairman of Syngenta AG from 2013 to 2017.
Skills and attributes which support strategy and long-term success:
– Proven multinational business leader with substantial international
finance, strategy and M&A experience.
– Highly skilled in governance and corporate stewardship, which
Michel brings both to the Board and to each of the Committees of
the Company on which he sits.
External appointments:
– AstraZeneca plc, non-executive chair, chair of the nomination and
governance committee and member of the remuneration committee
Hatem Dowidar N
Non-Executive Director
Tenure: <1 year
Career and experience:
Hatem was appointed a Non-Executive Director and a member of the
Vodafone Group Plc Board on 19 February 2024. Hatem brings 30
years of experience in multinational companies and more than 24
years of these within the telecommunications industry across various
leadership positions. Hatem initially began his career in AEG/
Deutsche Aerospace (Daimler Benz Group) in Egypt, before moving
into marketing at Procter & Gamble, where he held several
managerial roles. Prior to joining e& Group in September 2015,
initially as Group Chief Operating Officer before being appointed
Group Chief Executive Officer, Hatem held various leadership
positions at Vodafone including Group Chief of Staff, Group Core
Services Director, CEO of Vodafone Egypt and CEO of Partner Markets.
Skills and attributes which support strategy and long-term success:
– Highly skilled strategist and visionary, with experience leading
several ground-breaking strategic programmes.
– Extensive corporate governance experience through representation
as chair and board member on several corporate boards within and
outside the telecommunications industry.
External appointments:
– Etihad Etisalat Company (Mobily), non-executive director1
– Maroc Telecom, non-executive director1
– BlackRock Frontiers Investment Trust Plc, non-executive director
Note:
1. Please note these external appointments are part of the e& Group.
Delphine Ernotte Cunci R T
Non-Executive Director and Workforce Engagement Lead
Tenure: 1 year
Career and experience:
Since 2015, Delphine has been President of France Télévisions, the
French national public television broadcaster. Her mandate was
extended in 2020, the first time this has happened to an incumbent
President. Prior to that, Delphine spent 26 years at Orange S.A., where
she became Deputy CEO in 2010 and led the successful turnaround
of Orange France.
Skills and attributes which support strategy and long-term success:
– Considerable experience in the telecoms sector and, more recently,
in media and technology, which enhances Board understanding of
trends relevant to the Company’s operations and the wider
European regulatory environment.
– Delphine’s engineering background and distinguished career at
Orange provide relevant knowledge and experience to the Board’s
evaluation of specific opportunities within the telecoms and
connectivity space.
Deborah Kerr A T
Non-Executive Director
Tenure: 2 years
Career and experience:
Deborah is Managing Director at Warburg Pincus, where she serves as
Co-head of Value Creation. Deborah has previously held senior
executive roles and non-executive appointments across a range of
sectors, including senior executive roles at Sabre, the travel
technology company, Fair Isaac Corp, the data analytics business, and
Hewlett-Packard Company, where she was Chief Technology Officer
for HP’s Enterprise Services operations. Deborah was a non-executive
director of EXLservice Holdings Inc, the business process solutions
company, and Chico’s FAS, Inc. Deborah has also held non-executive
roles at International Airline Group, the airline conglomerate, DH
Corporation, a global fintech solutions and service provider, and
Mitchell International Inc, a privately owned global technology
business.
Skills and attributes which support strategy and long-term success:
– A wealth of technological expertise, including an understanding of
complex digital transformations, which continues to be central to
the next phase of the Company’s growth.
– Detailed knowledge of the technology market, which, in the
context of her role as a member of the Audit and Risk Committee,
affords insights into the risk profile of the Company as well as the
sectors and markets within which it operates.
External appointments:
– NetApp, INC, non-executive director and member of the audit
committee
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Governance (continued)
Committee key
A
Audit and
Risk Committee
E
ESG Committee
N
Nominations and
Governance Committee
R
Remuneration
Committee
T
Technology
Committee
Solid background signifies
Committee Chair
Maria Amparo Moraleda Martinez R E
Non-Executive Director
Tenure: 6 years
Career and experience:
Amparo joined IBM in 1988 and spent more than 20 years with the
company, becoming President of IBM Southern Europe in 2005. In
2009, Amparo joined Iberdrola S.A. where she was Chief Operating
Officer of the International Division until 2012. Amparo is a member
of the Royal Academy of Economic and Financial Sciences and was
inducted into the Women in Technology International Hall of Fame
in 2005.
Skills and attributes which support strategy and long-term success:
– A background in engineering, IT and technology equip Amparo
with significant experience and the ability to provide valuable
contributions during technical Board discussions.
– Corporate social responsibility experience and her experience as a
champion of inclusion and diversity are significant assets in the
context of her role as Chair of the Company’s ESG Committee.
External appointments:
– Airbus Group, senior independent director, chair of remuneration,
nominations and governance committee and member of ethics,
compliance & sustainability committee
– CaixaBank, non-executive director and chair of appointments and
sustainability committee
– A.P. Moller-Maersk, non-executive director, chair of the ESG
committee and member of the audit committee
David Nish A N
Non-Executive Director and Senior Independent Director
Tenure: 8 years
Career and experience:
David was Group Finance Director of Scottish Power Plc from 1999 to
2005 having joined the company as Deputy Finance Director in 1997.
Additionally, he was the Chief Executive Officer of Standard Life Plc
from January 2010 to September 2015 having joined the company as
Group Finance Director in November 2006. David was also a former
Partner at Price Waterhouse, where he began his career as a trainee.
Previous non-executive positions held by David include boards of
HSBC Holdings Plc, London Stock Exchange Group Plc, Zurich
Insurance Group Ltd, UK Green Investment Bank plc, Northern Foods
Plc, Thus Plc, HDFC Life (India) and Royal Scottish National Orchestra.
He was Deputy Chairman of the Association of British Insurers. He was
also formerly a member of the City UK Board Advisory Committee
and the Financial Services Advisory Board of the Scottish Government.
Skills and attributes which support strategy and long-term success:
– Wide-ranging operational and strategic experience as a senior
leader and a deep understanding of financial and capital markets.
– Significant finance experience, bringing strong direction as the
Chair of the Audit and Risk Committee through a focus on the risk
and control environment and Group resilience.
Christine Ramon A E
Non-Executive Director and Workforce Engagement Lead
Tenure: 1 year
Career and experience:
Christine was previously Chief Financial Officer and executive director
of AngloGold Ashanti Ltd, a global gold mining company. Prior to
AngloGold Ashanti, she was Chief Financial Officer of Sasol Ltd, a
South African energy and chemicals company. Christine was also a
former Chief Executive Officer at Johnnic Holdings Ltd, an investment
holding company with interests in media, entertainment and
telecommunications, prior to joining Sasol. Additionally, she has
worked at Pepsi as a Financial Controller. Christine has held non-
executive director roles at the International Federation of
Accountants, the global organisation for the accountancy profession,
MTN Group Ltd, a South African telecommunications company,
Lafarge S.A., a cement company, and Transnet SOC Ltd, a South
African rail, port and pipeline company.
Skills and attributes which support strategy and long-term success:
– Considerable experience of African markets, which aids the
Company with its ambition to be a best-in-class
telecommunications company in both Europe and Africa.
– Up-to-date investor relations experience and strong ambassadorial
skills developed through a distinguished executive career to date.
– Highly experienced corporate finance executive with extensive
board expertise, which supplements the Board’s existing financial,
commercial and strategic expertise.
External appointments:
– Clicks Group Limited, non-executive director, member of the
remuneration & nominations committee and member of the audit
& risk committee
– Discovery Limited, non-executive director, member of the audit
committee and social and ethics committee, member of the
remuneration committee and member of the treating the
customers fairly sub-committee
Simon Segars E T
Non-Executive Director
Tenure: 1 year
Career and experience:
Simon was previously the CEO of Arm Ltd., the global leader in the
development of semiconductor intellectual property. He successfully
led the business from 2013 to 2022 and generated significant value
for investors during his tenure. During 2017 to 2021, Simon was also a
Board member of the SoftBank Group. Prior to joining Arm in 1991, he
was an engineer at Standard Telephones and Cables.
Skills and attributes which support strategy and long-term success:
– Possesses significant understanding of technology trends and how
these are reshaping industry landscapes, which are important in
charting the Company’s long-term strategic direction.
– Proven history of business transformation and corporate strategy
in dynamic and swiftly evolving commercial environments.
External appointments:
– Dolby Laboratories, Inc., non-executive director
Click or scan to watch our Non-Executive Directors explain their role:
investors.vodafone.com/videos
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Biographical details of the Executive Committee, as at 14 May 2024
are provided below.
Margherita Della Valle BD
Group Chief Executive
Luka Mucic RC CD AI SB BD DC
Group Chief Financial Officer
Read more about the Group Chief
Executive on page 76
Read more about the Group Chief
Financial Officer on page 76
Aldo Bisio AI SB BD
Chief Commercial Officer and CEO Vodafone Italy
Aldo was appointed Group Chief Commercial Officer in January 2023.
He was appointed Chief Executive Officer of Vodafone Italia in January
2014 and joined the Executive Committee in October 2015. Aldo is
responsible for driving the Group’s commercial and brand strategy
through CX Excellence and the delivery of new digital services for the
consumer segment. As CEO of Italy, he is responsible for steering local
commercial strategy and driving operational excellence. Prior to joining
Vodafone, Aldo held the position of Group Managing Director of
Ariston Thermo Group from 2008 and he was then named Group Chief
Executive Officer in 2010. Being part of McKinsey & Co previously,
he held different positions in strategic consultancy focusing on the
telecommunications and media industries.
Maaike de Bie DC AI RC CD ER
Group General Counsel and Company Secretary
Maaike de Bie was appointed Group General Counsel and Company
Secretary on 1 March 2023 and has responsibility for the Group legal,
compliance, risk and company secretariat functions as well as advising
the Board on all aspects relating to corporate governance. She
previously served as General Counsel and Company Secretary of easyJet
plc and before that as General Counsel of Royal Mail plc. An experienced
international lawyer, Maaike is dual-qualified in both the US and UK, with
over 30 years of experience. Maaike is currently a Board Member of
General Counsel for Diversity & Inclusion (GCD&I). She is also a Trustee
of Blueprint for Better Business, which is an independent charity that
helps businesses to be inspired and guided by a purpose that respects
people and contributes to a better society.
Ahmed Essam SB BD
Executive Chairman Vodafone Germany and CEO European Markets
Ahmed was appointed Executive Chairman Vodafone Germany and
CEO European markets on 1 April 2024, and has been a member of
the Executive Committee since 2016. Ahmed has over 20 years of
experience in the fields of telecommunications, strategy, financial
planning, commercial management and general management. Ahmed
joined Vodafone in 1999 and earlier roles include Customer Care
Director and Consumer Business Unit Director, Group Management
Director for Vodafone’s Africa, Middle East and Asia-Pacific region, and
a number of senior roles within Vodafone’s Group Commercial
functions. Ahmed has been Group Chief Commercial Operations and
Strategy Officer, CEO Europe Cluster and CEO Vodafone UK.
Shameel Joosub
CEO Vodacom Group
Shameel joined Vodafone in 1994 and currently serves as Chief
Executive Officer at Vodacom Group Limited, a position he has held
since 2012. He has extensive telco experience having operated at a
senior level in various companies across the group for the last 23
years, including Managing Director at Vodacom South Africa and
Chief Executive Officer at Vodafone Spain. Shameel holds board
positions at Vodacom Group Ltd, Safaricom Plc and Vodafone Egypt
Telecommunications S.A.E. He also sits on the board of Business
Leadership South Africa. He was appointed to the Executive Committee
in April 2020, and is responsible for the overall strategic direction and
performance of all its African operations, comprising eight markets.
Our Executive Committee
Scott Petty NS AI ER SB BD
Vodafone Group Chief Technology Officer (CTO)
Scott joined Vodafone in 2009 and has held positions in Vodafone
Business Product Management and Technology before becoming UK
CTO in 2017. He has been the Chief Digital & Information Officer since
April 2021 as part of a newly created integrated European-wide
Technology team to drive the transformation to achieve Vodafone’s
ambition to become a Next Generation Telco. Previously, Scott held
a number of Executive roles at Dimension Data, as Group Executive –
Services, Chief Operating Officer – Australia and as Chief Information
Officer – Australia. Scott joined the Executive Committee in January 2023.
Joakim Reiter ER RC CD
Chief External and Corporate Affairs Officer
Joakim, an Executive Committee member since August 2017, is
Vodafone’s Chief External and Corporate Affairs Officer, responsible for
public relations and corporate affairs, including policy and regulation,
communications, security, sustainability and charitable activities. He
currently sits on the Board of the Swedish Space Corporation. Before
joining Vodafone, Joakim served as Assistant Secretary-General of the
United Nations and has also been Ambassador to the World Trade
Organisation, served as a Swedish senior diplomat to the EU, a trade
negotiator in the European Commission, and has had a longstanding
career in the Swedish Foreign Service.
Alberto Ripepi SB
Group Chief Network Officer (CNO)
Since joining Vodafone in 2001, Alberto has held various roles in
technology including CTO of Italy, CTO of Europe and Operational
Director for Group Technology. Alberto joined the Executive Committee
in January 2023 and is responsible for strategy, architecture and
design and for operating the Vodafone network in Europe.
Serpil Timuray ER
CEO Vodafone Investments
Serpil Timuray was appointed as CEO Vodafone Investments in April
2024, responsible for Joint Ventures, Partner Markets, and new telco
partnerships. Her prior roles at the Group Executive Committee were
CEO Europe Cluster, Group Chief Commercial Operations and Strategy
Officer, and Regional CEO AMAP. She joined Vodafone in January 2009
as CEO Turkey. Formerly, she worked at Danone Plc for 10 years latterly
as CEO Turkey. She began her career in 1991 at Procter & Gamble
where she held marketing roles for 8 years latterly as an Executive
Committee member in Turkey. Serpil is an Independent Non-Executive
Director at British American Tobacco Plc, the Chairperson of
VodafoneZiggo and a Non-Executive Director at TPG Telecom.
Leanne Wood SB AI RC
Chief Human Resources Officer
Leanne joined Vodafone as Chief Human Resources Officer and as a
member of the Executive Committee on 1 April 2019. She is responsible for
leading Vodafone’s people and organisation strategy, which includes
developing strong talent and leadership, effective organisations,
strategic capabilities and an engaging culture and work environment.
Previously Leanne was the Chief People, Strategy and Corporate Affairs
Officer for Burberry plc from 2015. Leanne is a Non-Executive Director
and member of the Audit, Corporate Responsibility and Nomination and
Remuneration Committees at Compass Group plc.
Committee key
DC Disclosure Committee
RC Risk and Compliance
Committee
ER ESG and Reputation
Steering Committee
AI AI Governance Board
SB Simplicity Board
CD Capital Decision Board
BD Business Decision Board
NS National Security Committee
Solid background signifies
Committee Chair
With effect from 1 April 2024, Marcel de Groot was appointed CEO
Vodafone Germany and Max Taylor was appointed CEO Vodafone UK.
They are not members of the Executive Committee and report to
Ahmed Essam. With effect from 1 July 2024, Marika Auramo will join
our Executive Committee as CEO of Vodafone Business.
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Governance (continued)
Our Company purpose, values and culture
Purpose
Our purpose is to connect for a better future. We aim to create a
digital society where everyone can thrive. The digital society that we
help to enable makes communities more prosperous and resilient.
However, we must seek to ensure that everyone is included, and that
progress does not come at the cost of the planet. This is why we place
Empowering People, Protecting the Planet, and Maintaining Trust at
the heart of our business, guiding everything we do. Our purpose is
championed by our Board, which is collectively responsible for the
oversight and long-term success of the Company. It is aligned with
our culture and our strategy, placed at the forefront of our decision
making and strategy development, and the Board considers how the
initiatives progressed by management throughout the year have
advanced our purpose. Board oversight ensures that continued
product development realises our ambition to connect for a better
future.
Read more about our purpose on pages 34-56
Strategy
The Board monitors the Company’s progress against established
strategic objectives and its performance against competitors. Board
meetings are planned with reference to the Company’s strategic
priorities and meeting agendas are constructed to deliver information
at appropriate junctures and from a broad range of senior leaders, to
enable the Board to effectively review and challenge.
Read more about Vodafone’s roadmap on page 9
Governance
The Board ensures the highest standard of corporate governance
is maintained by regularly reviewing developments in governance
best practice and ensuring these are adopted by the Company.
During the year, the Board dedicated time to thoroughly evaluate its
own effectiveness and that of each of the Directors individually, taking
into account their independence, time commitment, preparation
ahead of meetings, courage to challenge and whether they continue
to contribute effectively. Consideration was also given to the
arrangements in place to monitor conflicts of interest.
All Directors have access to the advice of the Company Secretary,
who is responsible for advising the Board on all governance matters
and ensuring the Board has access to the necessary policies,
processes and resources to operate efficiently and effectively.
Read more about our governance structure and roles and responsibilities
on pages 74-75
Values and culture
The Board has a critical role in setting the tone of our organisation and
championing the behaviours we expect to see throughout the Group.
The ‘Spirit of Vodafone’ aligns with our purpose and strategy, which
ultimately leads to a more motivated and productive workforce.
The Board has continued to influence and monitor culture throughout
the year and received updates on ‘Spirit of Vodafone’ initiatives,
including ‘Spirit of Vodafone’ Days, bi-annual Spirit Beat surveys, the
global pulse survey and surveys shared with new hires and leavers.
The cultural climate in Vodafone is measured through a number of
mechanisms including policy and compliance processes, internal
audit, and formal and informal channels for employees to raise
concerns. The latter includes our Spirit Beat survey and our
whistleblowing programme, Speak Up, which is also available to the
contractors and suppliers working with us. The Board is apprised of
any material whistleblowing incidents.
Alongside these mechanisms, the Board remains committed to
engagement with the workforce, and these opportunities continue to
shape how the Board influences and understands the Company’s culture.
Read more about Speak Up on page 44
Employee engagement
Given the geographical size and complexity of our business, we utilise
several employee engagement methods and communication
channels between the Board, the Executive Committee, and our
workforce to enable meaningful engagement.
Examples of these initiatives include:
Workforce Engagement Lead attendance at employee forums
The Board received feedback from Delphine Ernotte Cunci and
Christine Ramon, the appointed Workforce Engagement Leads, after
their attendance at employee forums in Europe and Africa. It is
evident from these meetings that employee delegates continue to
appreciate the opportunity to speak directly to a Board member.
Through these channels we understand that our people are engaged
and interested in market mergers & acquisitions, the customer
experience and opportunities for personal development and reskilling.
Workplace communications
‘Workplace’ is our internal digital platform that allows employees to
start conversations and groups on topics of their choice. The
Executive Committee and internal communications team regularly
post on the platform to provide updates to our people. Employees are
in turn able to post and directly respond with views and questions.
Key highlights in the year are shown in the table below:
Post
Topic
Customer service improvements
Our customers
Discussion focus: The Vodafone Italy CEO made an announcement showcasing
work that is being undertaken to improve our customer service experience.
The post informed employees how processes are being simplified and customers
supported with quicker callbacks from a focus on eliminating root causes.
Grow with Vodafone
People development
Discussion focus: The Chief Human Resources Officer reiterated Vodafone’s
commitment to giving everyone opportunities to learn new skills, develop
and progress by sharing the launch of a learning platform. Colleagues will be
able to learn new and develop existing skills that are aligned to our priorities
of Customers, Simplicity and Growth.
2023 Global Heroes
People development
Discussion focus: The Group Chief Executive announced the winners of the
Spirit of Vodafone Global Heroes Awards. These awards recognise and honour
colleagues across Vodafone, who go above and beyond to serve and support
our customers. From leveraging our connectivity to help those who need
assistance, to putting our customers first through better service. These
individuals and teams truly exemplify our goal as one Vodafone.
Performance Acceleration Meetings
People development
Discussion focus: The Group Chief Executive provided an update on PAMs
held in Germany, Italy, the UK, the EU Cluster and with _VOIS. These
‘townhall’ meetings focused on each markets progress of our action plans in
relation to Customers, Simplicity, and Growth. The CEO highlighted a
collective ambition to keep accelerating our transformation and the drive to
do better to serve our customers and be a best-in-class telco in Europe and
Africa as well as Europe’s leading B2B platform.
Financial results and
Group performance
Our business strategy
and performance
Discussion focus: Quarterly trading update videos on financial results and
Group performance were published. These enhance employees’ awareness of
the financial and economic factors affecting the Group and the Company’s
performance.
Employee listening
We have increased the opportunities for employees to share their
experiences throughout their time at Vodafone. We proactively gather
employees’ perspectives through the new hire life cycle, measuring
sentiment in the first week, month and 90 days. Exiting employees are
requested to feedback 48 hours after logging their notice.
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Board activities and principal decisions
Our Board is responsible for the overall leadership
of the Group and, throughout the year, Board
activities and discussion continued to focus on the
Company’s strategic priorities.
The Board oversees the Company’s strategic direction and supports
the executive management with its delivery of the strategy within a
transparent governance framework. Alongside deep-dives on the
strategic priorities and overall shape of the Group, the Board has
considered topics including the business plan, financial performance,
digital and technology, and governance. Further detail on these topics
is set out below.
Key stakeholders are considered in the decision-making process in
accordance with section 172 of the Companies Act 2006.
Read more about Vodafone’s key stakeholders and how the Board has engaged
with them during the year on pages 12-14
Our strategic priorities
Customers
Simplicity
Growth
Customers
Our customers remained a key focus throughout FY24 as we began
implementing the strategic transformation action plan communicated
in last year’s Annual Report.
Read more about our strategic transformation on pages 8-9
Information about the evolving needs of customers is regularly
provided to the Board by the Executive Committee members and
senior leaders.
Customer action plan
The Board received an update on customer satisfaction and
experience in markets across the Group in an interactive strategy
session held in September 2023. Discussion focused on the issues
faced by customers in each market and the implementation of seven
key actions as part of the renewed customer action plan.
The Board visited the contact centre in Stoke-on-Trent in January
2024 to see the UK customer action plan in progress. The Board
spent time with employees on the front line who have a deep
understanding of customer needs and were informed of service
improvements being made across all of our markets. The Board
received an update on the CX transformation progress and joined the
specialist care, business care, operations centre and digital centre
divisions during their visit to delve more deeply into operational
performance.
Vodafone Germany
The Board considered a proposed agreement with 1&1 Mobilfunk
GmbH (‘1&1’) and, on 2 August 2023, we announced that a long-term
national roaming partnership had been agreed. The agreement
supports current and future mobile technologies and will deliver 5G
mobile coverage to customers from the second half of calendar year
2024. The impact of inflation and evolution of technology were key
considerations that have been reflected in the agreement.
The market in Germany was a deep-dive topic discussed by the Board
during the year. The review considered key long-term transformative
initiatives across the three strategic priorities: Customers, Simplicity
and Growth.
Cost-of-living crisis
The Board was updated on the Company’s cost-of-living initiative to
ensure that consumers and small businesses continued to be supported.
Digital and technology
Technology Committee
The Board approved the creation of a Technology Committee as a
Committee of the Board on 10 May 2023. Subsequently, the
Technology Committee has kept the Board updated on the
development and implementation of the technology strategy. Focus
was given to the Tech2025 vision, which aims to enable digital
transformation to better serve our Customers, drive Simplicity and
enable Growth.
Read more about the Technology Committee
on page 95
Strategic partnerships and artificial intelligence
The Board has considered the impact of artificial intelligence on
different areas of the business.
On 13 November 2023, we announced plans to create a strategic
partnership with Accenture to commercialise shared operations to
accelerate growth, enhance customer service and drive significant
efficiencies for our operating companies and partner markets. The
partnership will utilise Accenture’s world-class technology and
transformation services such as digital solutions and platforms, and
it’s deep artificial intelligence expertise. The strategic partnership is
subject to completion of definitive agreements.
On 16 January 2024, the Company announced a 10-year strategic
partnership with Microsoft that aims to leverage our respective
strengths to bring generative artificial intelligence, digital services and
the cloud to more than 300 million businesses and consumers,
transforming the customer experience. The five key areas of
collaboration are generative artificial intelligence, scaling IoT, digital
acceleration in Africa, enterprise growth and cloud transformation.
Financial performance and capital
Financial performance
Throughout the year, the Board received regular updates on the
financial performance of the Group from the CFO and management
team. Trading performance and financial forecasts were reviewed
against the backdrop of strategic transformation, rising energy prices
and inflation pressures.
The Board reviewed the Group’s performance versus the budget for
last year. The budget for the coming year and long-range plan were
approved.
During the year, the Board considered and approved the half-year and
full-year results announcements, and the Annual Report and
Accounts, following the recommendation of the Audit and Risk
Committee.
Capital allocation review
On 15 March 2024, we announced that the Company had conducted
a broad capital allocation review, considering the investment profile
of the Group’s strategy within its reshaped footprint. The review
concluded that country-level capital intensity would be broadly
maintained at existing levels, a robust balance sheet would be
maintained with a new leverage policy, the ordinary dividend would
be rebased to 4.5 eurocents per share from FY25 onwards, and there
would be an opportunity for share buybacks following the completion
of the sale of Vodafone Spain and Vodafone Italy.
Dividend
The decision to approve the dividend was supported by a robust
assessment of the position, performance and viability of the business
carried out by management. On 14 November 2023, we announced
an interim dividend of 4.50 eurocents per share, which was paid on
2 February 2024. We have recommended a final dividend of 4.5
eurocents per share to be paid on 2 August 2024. This is consistent
with dividends declared during FY23 and the expectations of our
shareholders.
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Governance (continued)
UK
Board discussion focused on the strategic
options available to the UK business. The
proposed merger of Vodafone UK and
Three UK provides the necessary scale to
be able to accelerate the rollout of full 5G
coverage, benefiting customers through
competitively priced access to a reliable,
high-quality, and secure 5G network
throughout the UK. The transaction is great
for customers, great for the country and
great for competition.
Subject to regulatory and shareholder
approvals, the transaction is expected to
close around the end of 2024.
Key steps to date
– October 2022: we confirmed that
discussions were taking place with CK
Hutchison Holdings (‘CK Hutchison’) in
relation to a possible combination of
Vodafone UK and Three UK;
– June 2023: we announced that binding
agreements had been entered into with
CK Hutchison;
– December 2023: engagement with
political and regulatory stakeholders
continued; and
– January 2024: filing with the UK
Competition and Markets Authority. As
anticipated, in April 2024 the merger
inquiry progressed to Phase 2.
Spain
The Board received regular updates on the
transaction opportunities available to the
business portfolio in Spain. In October 2023,
we announced that the Board had taken the
decision to enter into binding agreements
with Zegona Communications plc (‘Zegona’)
for the sale of Vodafone Holdings Europe,
S.L.U. (‘Vodafone Spain’). The sale of
Vodafone Spain is a key step in right-sizing
the Group’s portfolio for growth and will
enable us to focus our resources in markets
with sustainable structures and sufficient
local scale, improving the Group’s
competitiveness. The transaction is subject to
regulatory clearance.
Key steps to date
– May 2023: the Board considered
transaction opportunities across the Group;
– September 2023: the Board received an
update on the structure of a proposed deal
and discussed the options available; and
– October 2023: we announced that the
Board had approved the request to enter
into binding agreements with Zegona in
relation to the full sale of Vodafone Spain.
Italy
Vodafone has engaged extensively with
several parties to explore market
consolidation in Italy, including through a
merger or disposal. The Board is supportive
of in-market consolidation and has
discussed the merits and risks of each
option presented at length. Following
input, the options available were narrowed
and in March 2023, we announced that a
binding agreement had been entered into
with Swisscom AG (‘Swisscom’) for the sale
of Vodafone Italy. The sale supports the
new strategic direction of the Group and is
subject to regulatory clearance.
Key steps to date
– December 2023: we reiterated that
Vodafone is supportive of in-market
consolidation in countries where
appropriate returns on invested capital
are not being achieved and confirmed
that options with several parties were
being explored to achieve this in Italy;
– February 2024: we announced that
Vodafone was in exclusive discussions
with Swisscom regarding a potential
sale of Vodafone Italy to Swisscom; and
– March 2024: we announced that a
binding agreement had been entered
into with Swisscom for the sale of
Vodafone Italy. The sale is the third and
final step in the reshaping of the Group’s
European operations. Subject to
regulatory approval, the sale to
Swisscom will create significant value
and ensures the business maintains its
leading position in Italy.
Strategy and business developments
Shape of the Group
The Board spent a significant amount of time during FY24 discussing our strategic priorities and the shape and size of the Group to support these.
In addition to the scheduled Board meetings, several adhoc meetings were held to consider strategic transactions. The Board also attended a
strategy off-site session in Germany that focused on strategic evolution, execution of the strategic priorities and portfolio objectives.
Section 172 considerations
In accordance with section 172 of the Companies Act, the Board, with support from external advisers where required, undertook an analysis as
part of the decision-making process to consider stakeholder interests and whether each of the proposed transactions was in the best interests
of the Company’s members as a whole. The following factors were taken into consideration by the Board in its analysis and decision-making:
terms and structure proposed; strategic and financial rationale; business plan and business case; valuation; due diligence findings; associated
risks; regulatory, legal and governance considerations; the impact on employees and customers; and market perception. Following
deliberation, the Board concluded that the proposed transactions were in the best interests of the Company, and aligned with our strategic
priorities. The transactions in Spain and Italy will deliver €12 billion of upfront cash proceeds. As part our broader capital allocation review, the
Company intends to return up to €2 billion to shareholders via buybacks following the completion of the sale of Vodafone Spain, with an
opportunity for further share buybacks of up to €2 billion following the completion of the sale of Vodafone Italy.
Investor relations
The Board received regular updates on market share information,
share price performance and how we have engaged with institutional
investors and analysts. Sentiment and feedback from investor
roadshows and conferences was also provided during the year.
Read more about how the Board engaged with investors during
the year on page 14
US shelf registration
In July 2023, the Board approved the renewal of Vodafone’s US shelf
registration to enable the Company to issue bonds in the US public
bond market.
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e& strategic relationship
In May 2023, we announced that the Company had agreed a strategic
relationship with e&. The strategic partnership enables collaboration
across a broad range of growth areas as both parties can benefit from
one another’s operational scale and complementary geographical
footprint. Under the terms of the Relationship Agreement, Hatem
Dowidar, CEO of e&, joined the Board on 19 February 2024. The Board
considered the potential impact the appointment could have on the
dynamic of the Board.
Read more on Hatem Dowidar’s skills
and experience on page 77
Vantage Towers
The Board was kept informed of updates regarding the Co-Control
Partnership for Vantage Towers whereby Vodafone received further
proceeds of €500 million from Global Infrastructure Partners and KKR
(together the “Consortium”) as result of the Consortium increasing
their ownership in Oak Holdings GmbH to 40%.
Vodafone Germany
The performance of Vodafone Germany remained a key consideration
for the Board this year. Discussion focused on strategy and ensuring
that appropriate programmes and support were in place to deliver on
the three-year transformation plan.
Group simplification
The Board has received regular updates on the simplification
programme, including on the structural changes required to
commercialise the global shared operations activities. The aim of the
programme is to drive additional efficiency.
Risk
During the year, the Board, with the support of the Audit and Risk
Committee, completed a review of the Company’s risk appetite,
principal and emerging risks, and how they are managed. The Audit
and Risk Committee also undertook a number of deep dives on our
principal risks during the year.
Read more about our system of internal controls and risk management
on page 93 and the Audit and Risk Committee deep dives on page 90
Our people
CFO succession
On 24 July 2023, the Company announced the appointment of Luka
Mucic as Group Chief Financial Officer effective from 1 September
2023, following a rigorous internal and external search. In accordance
with its terms of reference, the Nominations and Governance
Committee led on the succession process.
Read more about CFO succession in the Nominations and Governance Committee
report on page 86
Culture
The Board considered the results of the employee Spirit Beat survey
during the year. Feedback was positive and scores for Spirit,
Engagement and Purpose had increased despite times of change,
transformation and a challenging external environment.
Read more about Spirit Beat
on page 15
Employee voice
The Board received an update on the employee voice programme
and noted that a variety of formats and channels had been used
throughout the year to ensure employees across all of Vodafone’s
markets had the opportunity to express their thoughts and opinions.
Feedback was positive and demonstrated that colleagues were
engaged and interested in business strategy, mergers and acquisitions
activity and opportunities for personal development.
Read more about employee voice
on page 17
Modern slavery
The Board monitors the Group’s compliance with the requirements of
the UK Modern Slavery Act 2015 and approved its Modern Slavery
Statement in May.
Click to read our Modern Slavery Statement:
vodafone.com/modern-slavery-statement
Inclusion and diversity
The Board is kept updated on the progress of the diversity and
inclusion initiatives to support key areas, including talent attraction,
retention and development, allyship and education, and data.
Read more about inclusion
on pages 17-18
The Board diversity policy is reviewed on an annual basis.
Read more about our Board diversity policy
on pages 87-88
Other
The Board also spent time during the year considering the following
matters:
– Safety, health and wellbeing: the Board received bi-annual
updates covering health and safety performance, progress made
against risks, our health and safety culture and governance, and
progress on wellbeing activities, including mental health.
Read more about our renewed ambition for safety, health and wellbeing on pages
19-20
– Brand and reputation of the Group: the Board received an annual
update on Vodafone’s reputation, as measured by RepTrak. The
Company’s reputation remained stable and reflected the ongoing
contribution of our social contract positioning, multi-country
societal programmes and local corporate citizenship activities.
– Internal controls and assessment of the viability statement:
the Board receives an update at least annually from the Audit and
Risk Committee following its review of the effectiveness of the
Group’s system of internal controls, including risk management.
Following recommendation from the Audit and Risk Committee,
the Board approved the internal controls and viability statement
disclosures for inclusion in the Annual Report.
– Litigation: the Board was kept updated on litigation and material
legal risks that could impact our stakeholders and reputation.
The Board will continue to focus on the Group’s strategic priorities for
the year.
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Governance (continued)
Board effectiveness and improving our performance
Board evaluation findings
The Board discussed the findings from the evaluation and was encouraged by the strengths identified. In particular, the Board agreed that:
Effectiveness
The Board is very effective in working together as a cohesive unit and continues to improve following the changes made
during FY24. Board members are very collaborative, respectful and flexible when urgent ad-hoc matters arise.
Key strengths of the Board were highlighted as being:
– Collaborative, effective and well prepared.
– An active, open and engaged Chair.
– The ability to act promptly and decisively, as demonstrated through the CEO change.
– Alignment between the Directors on strategy and tactics.
– Its composition with highly relevant sector expertise to advise and provide management oversight.
Directors were asked to share their thoughts and considerations of the appointment process of the Chief Financial
Officer to assist in evaluating the Board’s effectiveness. The comments reflected a very positive experience,
underscoring the effectiveness of the Board’s action and processes:
– “A very focused and effective process balancing input and clear direction- with a good outcome.”
– “Good engagement and challenge… ended in the right place.”
– “Transparent and effective.”
– “Conducted very thoughtfully.”
– “Completed at appropriate speed and an excellent candidate was appointed.”
The Board recognises that it needs to continually
monitor and improve its performance. Our annual
performance evaluation provides the opportunity
for the Board and its Committees to consider and
reflect on the effectiveness of its activities, the
quality of its decision-making and the contribution
made by each Board member.
Process undertaken for our Board evaluation
In accordance with the UK Corporate Governance Code 2018, an
annual evaluation of the Board was conducted to consider its
composition, diversity and how effectively members work together to
achieve objectives. In FY24, the Board evaluation was conducted
internally, bringing Vodafone back into the typical three-year
evaluation cycle.
FY22
FY23
FY24
FY25
Externally led evaluation by
Raymond Dinkin of Consilium
Limited (‘Consilium’), an
independent board review
firm.
Internally led evaluation
Internally led evaluation
Expected to be an
independent externally led
evaluation
Evaluation process
The internal evaluation was led by the Chair and supported by the
Group General Counsel and Company Secretary. The objectives of the
review were to provide an assessment of:
– Vodafone Group’s Board effectiveness and governance;
– The effectiveness of Vodafone Group’s Committees; and
– The effectiveness of Directors individually, taking into account their
preparation ahead of meetings, time commitment, independence
and courage to challenge.
The structure of the evaluation was agreed to take a hybrid format,
comprising self-assessment questionnaires for the Directors and
one-on-one conversational meetings with the Chair. In a change from
prior years, response was also sought from the Group General
Counsel and Company Secretary to enable greater scrutiny and
provide an additional review for consideration and reflection.
With strong regard to the provisions and principles outlined in the UK
Corporate Governance Code 2018 and matters of specific importance
to Vodafone, a tailored Board questionnaire consisting of 27 questions
was compiled to gather and distil feedback on the following topics:
– Effectiveness;
– Skills, composition and diversity;
– Leadership (the appraisal of the Chair, led by the Senior
Independent Director, was included here);
– Fundamentals of administration and process; and
– Board Committees.
Conversely, the one-on-one meetings between Directors and the
Chair took a less structured form to enable Directors to lead on the
topics of conversation and raise specific items and comments
organically.
The Directors’ responses were collated and a paper summarising the
findings was presented to the Nominations and Governance
Committee and the Board at their January 2024 meetings.
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Skills,
composition, and
diversity
The Board has the appropriate diversity, experience and knowledge, skills and expertise, and time to be as effective as
possible in the context of developing and delivering the strategy, and addressing the challenges and opportunities, and the
principal risks facing the Company. Recent changes in composition have bolstered the Board, demonstrating that diversity
and knowledge were clearly considered when changes were reviewed and agreed.
The formation of the Technology Committee has been a positive step for the Board and the Company.
Leadership
The Board has highly effective leadership with a Chair who is successful in gathering inputs and ensuring the Board has
sufficient time for robust debate and discussion. The Chair is an excellent facilitator, who encourages views from all
members, with no suppression of contrarian views, which enables meaningful participation.
Fundamentals of
administration
and process
Board meetings are of the right frequency and length. Board materials provided allow the Board to effectively carry out its
responsibilities and provide for the desired level of review and discussion.
The Board also identified and agreed key areas of improvement and focus for FY25:
Board
Operational excellence: continue to prioritise the time spent on the key strategic pillars of Customers, Simplicity and Growth.
Workforce engagement and culture: strengthen the structure and engagement plan with greater insight fed back to the Board.
Focus on the successful integration of the new e& representative as a Director to ensure the effective functioning of the
Board continues.
Continued focus on succession planning at Board and Senior Managment level.
Progress against the areas identified for focus following the FY23 internal evaluation are shared below:
Areas identified for improvement
Progress
Leadership: succession planning, including securing and onboarding
an outstanding Chief Financial Officer
In July 2023, the appointment of Luka Mucic from 1 September 2023
as the Chief Financial Officer was announced. The Nominations and
Governance Committee and the Board have also considered succession
planning in a number of meetings.
Operational performance: prioritising time spent on the key strategic
priorities of Customers, Simplicity and Growth
The Board spent a full day in September 2023 focusing on the three
strategic priorities and the initiatives supporting them. Additional
sessions and updates on these initiatives featured in the remaining
FY24 Board meetings including a deep dive into the satellite strategy
and an update on deep detractor reductions.
Technology: increasing the Board’s focus on technology strategy
and capital allocation
In May 2023, the Board approved the establishment of the Technology
Committee. The Committee met three times in FY24 and focused on
the current technology strategy including deep dives and the
budgeting process for FY25.
Individual evaluation
Specific questions enabling a formal and rigorous annual evaluation of individual Directors’ performance were included within the self-assessment
questionnaire. Each individual Director’s effectiveness of contribution was rated, asking the respondent to take into account preparation ahead of
meetings, time commitment, independence and courage to challenge. The results proved very favourable, concluding that each Director
continues to make a valuable contribution to Board meetings and to the meetings of the Committees on which they sit, as well as supporting the
view that the Directors work effectively together to contribute to the Company’s long-term success.
Board Committees
Each of the Board’s Committees were evaluated as part of the broader evaluation process under the final section of the self-assessment
questionnaire. Questions covered the logistics, performance and effectiveness of Committees and their respective Chairs. The conclusions of this
review were positive, with Committee members agreeing that the Committees were functioning effectively, with their respective Chairs
encouraging open communication and meaningful participation. Key strengths of the Committees were highlighted, as were areas for
improvement.
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Nominations and Governance Committee
Governance (continued)
The Nominations and Governance Committee (the
‘Committee’) continues to monitor the composition,
structure and size of the Board and its Committees
to ensure that there is an appropriate balance
of skills, knowledge, experience and diversity so
that responsibilities can be discharged effectively.
The Committee oversees all matters relating to
corporate governance and succession planning and
makes recommendations to the Board as appropriate.
Chair
Jean-François van Boxmeer
Members
Stephen A. Carter CBE
Michel Demaré
Hatem Dowidar (appointed as a member on 19 February 2024)
David Nish (appointed as a member on 25 July 2023)
With the exception of Hatem Dowidar, the Committee is comprised of
independent Non-Executive Directors. The Committee had four
scheduled meetings during the year and additional ad hoc meetings
as required. The attendance at Committee meetings can be found on
page 70.
Letter from Committee Chair
On behalf of the Board, I am pleased to present the Nominations and
Governance Committee Report for the year ended 31 March 2024.
Group Chief Financial Officer – Luka Mucic
Last year we reported that a key focus for the Committee was to
appoint a Group Chief Financial Officer following our announcement
that Margherita Della Valle had been appointed permanent Group Chief
Executive Officer. The Committee formulated a detailed specification,
taking into consideration the experience, technical knowledge and
leadership characteristics required for the position of Group Chief
Financial Officer. An internal review process was undertaken and Egon
Zehnder, an independent external search firm, was also appointed to
support the Committee with the search for suitable candidates. A list of
potential candidates was provided to the Committee for their further
consideration. Following interviews and further testing of the
candidates’ credentials, the Committee made a recommendation to the
Board in July 2023. The Board approved the recommendation to
appoint Luka Mucic as Group Chief Financial Officer with effect from 1
September 2023. Luka also joined the Executive Committee with effect
from the same date and he chairs the Risk and Compliance Committee
and the Capital Decision Board, which are sub-committees of the
Executive Committee.
Luka has a strong track record of international leadership, corporate
repositioning and value creation, and we are pleased to welcome him
to the Board as the Group undertakes its strategic transformation.
Luka’s appointment to the Board will be subject to shareholder
approval at the 2024 AGM.
Read more on Luka’s background on page 76
and onboarding on page 88
Board composition and succession planning
The Committee reviews the composition of the Board and its Committees,
evaluating the balance of skills, experience, independence, knowledge and
diversity requirements. It also monitors the length of tenure and skills of
the Non-Executive Directors to assist with succession planning.
During the year, Sir Crispin Davis, Dame Clara Furse and Valerie
Gooding stepped down as Non-Executive Directors following the
conclusion of the 2023 AGM. With effect from the same date, David
Nish was appointed Senior Independent Director, Amparo Moraleda
was appointed Remuneration Committee Chair and Delphine Ernotte
Cunci and Christine Ramon were appointed Workforce Engagement Leads.
Following receipt of the necessary regulatory approvals, Hatem
Dowidar, the CEO of e&, Vodafone’s largest shareholder, joined the
Board as a Non-Executive Director and member of the Nominations
and Governance Committee on 19 February 2024. Hatem brings to
the Board extensive experience within the telecommunications
industry and has held senior positions across a range of companies in
the Middle East, Africa and Europe.
The Committee is confident that the Board currently has the
necessary mix of skills and experience to contribute to the Company’s
strategic objectives.
Read more about the details of the length of tenure of each Director and a summary
of the skills and experience of the Non-Executive Directors on pages 70 and 76-78
Executive Committee changes, succession planning and talent
pipeline
The Committee receives regular updates on succession planning and
changes to the membership of the Executive Committee. During the
year, the Committee discussed succession plans for executives below
Board level, focusing on the strength, depth and diversity of the talent
pipeline. A deep-dive assessment of the key leadership roles was also
undertaken to ensure alignment with the new business strategy and
operating model.
With effect from 1 April 2024, we made a number of changes to our
Executive Committee. Ahmed Essam was appointed Executive
Chairman Vodafone Germany and CEO European Markets. Serpil
Timuray was appointed CEO Vodafone Investments, taking on
responsibility for our investments. Philippe Rogge stood down from
his role as CEO Vodafone Germany and as a member of the Group
Executive Committee. Marcel de Groot was appointed CEO Vodafone
Germany and Max Taylor was appointed CEO Vodafone UK. Both
Marcel and Max report to Ahmed Essam and are not members of the
Executive Committee.
On 16 April 2024, we announced that Marika Auramo had been
appointed as CEO of Vodafone Business and a member of Vodafone’s
Executive Committee, with effect from 1 July 2024. Marika will take over
from Giorgio Migliarina, who has successfully led Vodafone Business as
interim CEO since Vinod Kumar’s departure on 31 December 2023.
Governance
The Committee continues to review action taken to comply with
the 2018 UK Corporate Governance Code (the ‘Code’) and other legal
and regulatory obligations during the year. The Committee receives
regular governance updates and is satisfied that Vodafone complied
with the Code in full throughout the year.
Appointment process
When considering the recruitment of new Directors, the Committee
adopts a formal and transparent procedure, which takes into account
the skills, knowledge and level of experience required as well as social
mobility factors and diversity. To begin the appointment process,
the Company engages with an external search consultancy,
which it provides with a search specification. The consultancy
then proposes a list of individuals with a diverse range of backgrounds
and characteristics. The shortlisted candidates are interviewed by
Committee members and they meet with the Group Chief Executive,
Chair and Chief Human Resources Officer. A recommendation is made
to the Board on the chosen candidate. Once a candidate is selected,
appointment terms are drafted and agreed with the selected candidate.
The Committee recognises that it is important for the Board to anticipate
and prepare for the future and to ensure that the skills, experience,
knowledge and perspectives of individuals reflect the ongoing needs of
the Group. Focus has renewed on succession planning at Board level
in anticipation of upcoming scheduled retirements in 2025.
Click or scan to watch our Non-Executive Directors explain their role:
investors.vodafone.com/videos
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Independence
In accordance with the Code, the independence of all the Non-
Executive Directors was considered by the Committee. Following
evaluation, with the exception of Hatem Dowidar, all Non-Executive
Directors are considered independent, and they continue to make
independent contributions and effectively challenge management.
All Non-Executive Directors have submitted themselves for election
or re-election, as applicable, at the 2024 AGM.
The Executive Directors’ service contracts and Non-Executive
Directors’ appointment letters are available for inspection at our
registered office and at the 2024 Annual General Meeting.
Conflicts of interest
The Companies Act 2006 provides that directors have a duty to avoid
a situation in which they have or may have a direct or indirect interest
that conflicts or might conflict with the interests of the Company. This
duty is in addition to the existing duty owed to the Company to
disclose to the Board any interest in a transaction or arrangement
under consideration by the Company.
Our Directors must report any changes to their commitments to the Board,
immediately notify the Company of actual or potential conflicts or a
change in circumstances relating to an existing authorisation, and
complete an annual conflicts questionnaire. Any conflicts or potential
conflicts identified are considered and, where appropriate, authorised
by the Board in accordance with the Company’s Articles of Association.
A register of authorised conflicts is also reviewed periodically.
The Committee is comfortable that it has adequate measures in place to
effectively identify, manage and mitigate any actual or potential conflicts
of interest so as not to compromise or override independent judgement.
Time commitment
In accordance with the Code, the Committee actively reviews the time
commitments of the Board. All Directors are engaged in providing their
external commitments to establish that they have sufficient time to
meet their Board responsibilities. The Committee is satisfied that the
Board does meet this requirement and all Directors provide constructive
challenge and strategic guidance and hold management to account.
Board evaluation
In accordance with the Code, Vodafone conducts an annual evaluation
of Board and Board Committee performance, which every Director
engages in and which is facilitated by an independent third party at
least once every three years. In FY24, an internal evaluation of the
performance of the Board and Committees took place led by the Chair,
with support from the Group General Counsel and Company Secretary.
Read more about the outcome of this Board evaluation
on pages 84-85
Roles and responsibilities
The terms of reference for the Nominations and Governance
Committee set out the role and responsibilities of the Committee in
further detail and are reviewed annually.
Click to read the Committee’s terms of reference:
vodafone.com/board-committees
Key areas of focus for FY25
– Board and Committee composition, tenure and succession; and
– Senior leadership succession and onboarding.
Jean-François van Boxmeer
On behalf of the Nominations and Governance Committee
14 May 2024
Diversity
The Board diversity policy reinforces the ongoing commitment of the Board
to supporting diversity and inclusion in the boardroom, in all its forms
including age, gender, ethnicity, sexual orientation, disability and
socio-economic background. The Committee acknowledges the significant
role diversity and inclusion has on the effective functioning of the Board and
its Committees and believes a diverse Board brings a broader perspective,
which enables it to be better equipped to understand the views of our
stakeholders as well as our shareholders in the decision-making process.
The Board diversity policy is kept under review to ensure
the objectives remain appropriate and sufficiently stretching. We also
continue to monitor requirements set by the Financial Conduct
Authority, FTSE Women Leaders Review, NASDAQ listing rules and
Parker Review in terms of gender and ethnic diversity. Vodafone
acknowledges that these targets are not just an end goal, but rather
steps towards a drive for further progress.
Whilst the Board Diversity Policy specifically focuses on diversity at
Board and Committee level, commitment to diversity at Vodafone
extends beyond the Board to the Executive Committee, talent
pipeline and global workforce. The Board supports management in
their efforts to build a diverse organisation throughout the Group and
is regularly apprised of progress on the key diversity areas of focus
beyond the Board and Executive Committee. As at 31 March 2024,
our Executive Committee has four positions held by women (33%)
and 25% of the Executive Committee identifies as ethnically diverse.
In the Senior Leadership Team, 37% of positions (from continuing
operations) are held by women and 21% of the Senior Leadership
Team (from continuing operations) identifies as ethnically diverse.
Read more on Senior Leadership
Team diversity on page 19
Read more about our workforce inclusion
programmes on pages 17-18
Diversity targets – progress update
Target
Progress
The Board aspires to meet and ultimately exceed the target
for at least 40% of Board positions to be held by women.
As at 31 March 2024, 42% of our Board identified as women.
That at least one of the positions of Chair, CEO, CFO or
Senior Independent Director is held by a woman.
As at 31 March 2024 our Group Chief Executive Officer position is held by a
woman.
That at least one member of the Board is from a minority
ethnic background.
As at 31 March 2024, we currently have two Board members from a minority
background, and we continually aspire to increase diverse representation on our Board.
Board and executive management diversity
Prepared in accordance with UK Listing Rule 9.8.6R(10) as at 31 March 2024
Gender identity or sex1
Number of Board members
Percentage of the Board
Number of senior positions on the
Board (CEO, CFO, SID and Chair)
Number in executive
management
Percentage of executive
management
Men
7
58%
3
8
67%
Women
5
42%
1
4
33%
Other categories
0
0%
0
0
0%
Not specified/prefer not to say
0
0%
0
0
0%
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Governance (continued)
Ethnic background
Number of Board members
Percentage of the Board
Number of senior positions
on the Board (CEO, CFO, SID
and Chair)
Number in executive
management
Percentage of executive
management
White British or other White
(including minority-white groups)
10
83.33%
4
9
75%
Mixed/Multiple Ethnic Groups
0
0%
0
0
0%
Asian/Asian British
1
8.33%
0
2
17%
Black/African/Caribbean/Black British
0
0%
0
0
0%
Other ethnic group, including Arab
1
8.33%
0
1
8%
Not specific/prefer not to say
0
0%
0
0
0%
Note:
1. The data reported is on the basis of gender identity.
Board diversity matrix
This has been prepared in accordance with the guidance issued by NASDAQ. More information can be found here: listingcenter.nasdaq.com
As of 31 March 2024
As of 31 March 2023
Country of Principal Executive Offices
United Kingdom
United Kingdom
Foreign Private Issuer
Yes
Yes
Disclosure Prohibited Under Home Country Law
No
No
Total Number of Directors
12
13
Gender Identity
Female
Male
Non-Binary
Did Not
Disclose
Gender
Female
Male
Non-Binary
Did Not
Disclose
Gender
Directors
5
7
0
0
7
6
0
0
Demographic Background
Underrepresented Individual in Home Country Jurisdiction
1
1
LGBTQ+
0
0
Did Not Disclose Demographic Background
0
1
meetings with external advisers and stakeholders, Luka met with
internal stakeholders responsible for the key business operations
within his reporting line. His induction covered a range of topics
including strategy, finance, commercial, legal and governance. Luka
also attended teach-in sessions with the networks and digital teams.
Upon joining the Board as Non-Executive Directors, Christine Ramon
and Hatem Dowidar undertook a tailored onboarding programme
covering a range of areas of the business including, strategy, finance,
risk, and stakeholder matters. They also met with senior management
from key business areas and functions, and received a briefing from
our external advisers which included: Directors’ duties; the Market
Abuse Regulation; and listing and disclosure obligations. Prior to
Hatem joining, Christine, alongside the Chair, attended a meeting with
employees after the 2023 AGM in Newbury. She also met with
employees during the Board site visit to the call centre in Stoke-on-
Trent.
Upon appointment, all Directors receive a comprehensive induction
pack which includes key background information on the Company,
corporate governance guidance, and internal policies and codes.
Director development and training
As the external business environment in which the Group operates
continues to evolve, it is crucial that our Directors’ skills and
knowledge are refreshed and updated regularly. The Chair has overall
responsibility for ensuring that our Non-Executive Directors receive
suitable ongoing training to enable each to remain an effective Board
member. Individual training requirements are reviewed regularly and
the Board is kept informed of training opportunities, including those
offered by our external advisers.
In addition to individual tailored training, updates on corporate
governance, legal and regulatory matters are also provided by way of
briefing papers and presentations at Board meetings.
The data contained in the tables on this page was collected as part of
the annual declaration process, whereby the Board and the Executive
Committee received declaration forms for self-completion. The
declaration forms included, for all individuals whose data is being
reported, the same questions relating to ethnicity, gender, sexual
orientation and disability. The data is used for statistical reporting
purposes and is provided with consent. The data in the above tables is
as at 31 March 2024, and there have been no changes in the period
between then and the date of this report.
Whilst we commit to diversity and inclusion in all its forms, all
appointments are made on merit and objective criteria to ensure the
appropriate mix of skills and experience on the Board, valuing the
unique contribution that an individual will bring.
Director appointments and onboarding
Director appointments
Details of the appointments to the Board made during FY24 are
described in the Nominations and Governance Committee Report on
page 86.
Onboarding process
Upon appointment, each new Director receives a comprehensive and
formal induction programmed tailored to their needs, experience and
the requirements of the role. Consideration is also given to
Committee appointments and the Group General Counsel and
Company Secretary assists the Chair in designing and facilitating the
individual programmes. Onboarding is crucial to ensuring that our
Directors have a full understanding of all aspects of our business,
including the Group’s strategy, vision and values, to ensure they are
able to contribute effectively to the Board. All Directors are also
encouraged to attend site visits.
Luka Mucic received a bespoke induction which focused on his
responsibilities as Group Chief Financial Officer. In addition to
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The Committee oversees the governance
of the Group’s risk management system, financial
reporting, the external audit process, internal
control and related assurance processes. During
the year, the Committee completed a series of deep
dive reviews of principal key risks and additional
reviews with a focus on strategic transformation
and cyber security.
Chair and financial expert
David Nish
Members
Michel Demaré
Deborah Kerr
Christine Ramon
Key responsibilities
The responsibilities of the Committee are to:
– Monitor the integrity of the financial statements, including the
review of significant financial reporting judgements;
– Monitor the Group’s risk management system, review the principal
risks and the management of those risks;
– Provide advice to the Board on whether the Annual Report is fair,
balanced and understandable and on the appropriateness of the
long-term viability statement;
– Review and monitor the external auditor’s independence and
objectivity and the effectiveness of the external audit;
– Review the system of internal financial control and compliance
with section 404 of the US Sarbanes-Oxley Act;
– Review and provide advice to the Board on the approval of the
Group’s US Annual Report on Form 20-F; and
– Monitor the activities and review the effectiveness of the Internal
Audit function.
Click to read the Committee’s terms of reference:
vodafone.com/board-committees
Letter from the Committee Chair
I am pleased to present our report as Chair of the Audit and Risk
Committee. This report provides an overview of how the Committee
operates, an insight into the Committee’s activities during the year
and its role in ensuring the integrity of the Group’s published financial
information and the effectiveness of its risk management, controls
and related processes.
The Committee met five times during the year, which included a joint
meeting with the ESG Committee. The attendance by members at
Committee meetings can be seen on page 70. Each meeting agenda
included a range of topics across the Committee’s areas of
responsibility:
– We undertook a programme of reviews across multiple business
units, typically with a focus on the risk and control environment.
This was performed with the CEO and CFO of the Other Europe
markets cluster, the CEOs of Vodafone Germany, Vodafone UK,
Vodafone Spain and Vodacom Group, the Chief Commercial Officer
and CEO Vodafone Italy and the CFO of Vodafone Business;
– External cyber threats continue to be a principal risk for the Group.
Accordingly, the Committee met with the Chief Technology Officer
and Cyber Security, Technology Assurance and Strategy Director to
review and challenge the cyber security strategy and undertook
a deep dive review of this principal risk;
Read more about cyber security
on pages 46 to 51
– We performed deep dive reviews on several other principal risks,
including Supply chain disruption, Data management and privacy,
Disintermediation and Adverse political and policy environment;
– At the September 2023 and March 2024 meetings, we considered
the anticipated financial reporting matters impacting the half-year
and year-end reporting. We also reviewed the half-year results
announcement at our November meeting and this Annual Report
and accompanying materials at our March and May meetings. Our
work included reviews of the Strategic Report, goodwill impairment
testing, taxation judgements, legal contingencies and
the Company’s work on going concern and the long-term viability
statement.
The Committee recognises the importance of Environmental, Social
and Governance (‘ESG’) topics and the evolving disclosure
requirements in this area. During our joint meeting in May 2024, we
challenged the disclosures included in this Annual Report and also
the Group’s ESG Addendum, which is available on our website.
Our external auditor, Ernst & Young (‘EY’), provides robust challenge
to management and its independent view to the Committee on
specific financial reporting judgements and the control environment.
David Nish
On behalf of the Audit and Risk Committee
14 May 2024
Objective
The objective of the Committee is the provision of effective
governance over the appropriateness of financial reporting of the
Group, including the adequacy of related disclosures, the
performance of both the Internal Audit function and the external
auditor and oversight of the Group’s systems of internal control,
business risks and related compliance activities.
Click or scan to watch the Chair of the Audit and Risk Committee explain his role:
investors.vodafone.com/videos
Committee governance
Committee meetings normally take place the day before Board
meetings. The Committee Chair reports to the Board, as a separate
agenda item, on the activity of the Committee and matters of
particular relevance. The Board has access to the Committee’s papers
and receives copies of the Committee minutes. The Committee
regularly meets separately with the external auditor, the Group Chief
Financial Officer, the Group Audit Director and the Group Head of Risk
without others being present. The Chair also meets regularly with the
external lead audit partner during the year, outside of the formal
Committee process.
The Chair is designated as the financial expert on the Committee
for the purposes of the US Sarbanes-Oxley Act and the 2018 UK
Corporate Governance Code (‘Code’). The Committee continues to
have competence relevant to the sector in which the Group operates.
Read more about the skills and experience of Committee members
on pages 76 to 79
Audit and Risk Committee
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Governance (continued)
Financial reporting
The Committee’s primary responsibility in relation to the Group’s
financial reporting is to review, with management and the external
auditor, the appropriateness of the half-year and annual consolidated
financial statements. The Committee focuses on:
– The quality and acceptability of accounting policies and practices;
– Providing advice to the Board on the form and basis underlying
the long-term viability statement;
– Material areas in which significant judgements have been applied
or where significant issues have been discussed with the external
auditor;
– An assessment of whether the Annual Report, taken as a whole, is
fair, balanced, and understandable and whether our US Annual
Report on Form 20-F complies with relevant US regulations;
– The clarity of the disclosures and compliance with financial
reporting standards and relevant financial and governance
reporting requirements; and
– Any correspondence from regulators in relation to our
financial reporting.
Accounting policies and practices
The Committee received reports from management in relation to:
– The identification of critical accounting judgements and key
sources of estimation uncertainty, including the impact of climate
change on the consolidated financial statements;
– Significant accounting policies; and
– Proposed disclosures of these in this Annual Report.
Following discussions with management and the external auditor, the
Committee approved the disclosures of the accounting policies and
practices set out in note 1 ‘Basis of preparation’ and within other notes
to the consolidated financial statements.
Risk deep dive reviews
The Committee performed a series of deep dives with management as part of the meeting agendas. These reviews are summarised below,
together with the Group’s principal risk to which the review relates.
Principal risk
Area of focus
Disintermediation
New technologies
The Committee met with the Group Strategy Director to review and challenge the Group’s activities and strategies to
mitigate the potential risks from new industry challengers and technologies.
Cyber threat
Technology
resilience and
future readiness
Cyber security strategy
The Committee met with the Chief Technology Officer and the Cyber Security, Technology Assurance and Strategy Director
to review the Group’s cyber security strategy and related compliance and assurance activities in this area.
Adverse political
and policy
environment
Regulatory developments
The Committee met with the Chief External and Corporate Affairs Officer to deep dive on the political and regulatory
developments impacting the industry and the actions underway to respond to these risks.
Company
transformation
Adverse macro-
economic condition
Adverse market
competition
Portfolio
transformation and
governance of JVs
Business reviews
The Committee met with a range of markets and business units, with a focus on the operational landscape, local risk
assessments and related activity, the control environment and progress against any findings from Internal Audit activities.
This included:
– Germany market review, including distribution channels, with the market CEO;
– Business review of Vodafone UK with the market CEO;
– Review of Vodafone Business with the Vodafone Business CFO;
– Business review of Vodafone Spain with the Europe Cluster CEO and market CEO;
– Europe Cluster review with the Europe Cluster CEO and CFO;
– Strategy review of M-Pesa with the Vodacom Group CEO, CFO and Chair of the Vodacom Audit Committee;
– Deep dive on adverse market competition with the Chief Commercial Officer and CEO Vodafone Italy;
– Review of cash flow forecasting and management with the Head of Financial Planning and Analysis; and
– Business review with the CEO and CFO of Vantage Towers, which is a joint venture of the Group.
Supply chain
disruption
Strategy
The Committee met with the Global Supply Chain Director to deep dive on the threats of supply chain challenges and the
Group’s strategy to continue to execute its logistics optimisation strategy.
Data management
and privacy
Data
The Committee met with the Head of Legal Privacy twice during the year to review and challenge the Group’s strategy
around: (i) the data risk management action plan and (ii) data privacy risk and how compliance standards are being met.
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Area of focus
Actions taken
Portfolio changes
The Group announced the disposal of Vodafone Spain in October
2023 and the disposal of Vodafone Italy in March 2024. Vodafone
Spain and Vodafone Italy are both material operating segments of
the Group. Consequently, the results are reported as discontinued
operations in the year, with comparative information in both the
income statement and cash flow statement re-presented to reflect
this classification.
At 31 March 2024, the Group awaits certain regulatory approvals for
both transactions and therefore the assets and liabilities of Vodafone
Spain and Vodafone Italy are presented as held for sale.
See note 7 ‘Discontinued operations and assets held for sale’ in the
consolidated financial statements.
The Committee met with the Group Financial Controlling and
Operations Director in March and May 2024 who outlined the key
accounting and disclosure impacts in relation to the transactions in
the consolidated financial statements.
India accounting matters
The disclosure and accounting judgements in relation to:
– The Group’s conditional and capped obligations to make certain
payments to Vodafone Idea Limited (‘VIL’) under a payment
mechanism agreed at the time of the merger between Vodafone
India and Idea Cellular in 2017; and
– The valuation of a mark-to-market derivative asset in relation to
the Total Return Swap (‘TRS’).
See note 22 ‘Capital and financial risk management’ and note 29
‘Contingent liabilities and legal proceedings’ in the consolidated
financial statements.
The Committee reviewed the appropriateness of the Group’s
accounting judgements in relation to potential liabilities under the
payment mechanism agreed with VIL.
The Committee also reviewed accounting judgements relating to the
valuation of the TRS derivative asset.
These reviews occurred at the September 2023, November 2023,
March 2024 and May 2024 Committee meetings.
Impairments
Judgements in relation to impairment testing relate primarily to the
assumptions underlying the calculation of the value in use of the
Group’s businesses, being the achievability of the long-term business
plans and the macroeconomic and related valuation model
assumptions.
See note 4 ‘Impairment losses’ in the consolidated financial
statements.
The Committee met with the Group Head of Financial Planning &
Analysis in November 2023 and May 2024 to discuss the impairment
exercise undertaken and to challenge the appropriateness of
assumptions made, including:
– Management’s valuation methodology;
– The achievability of the Group’s five-year business plans;
– The potential impacts of market factors on the Group’s businesses
and their business plans;
– The long-term growth assumed for the Group’s businesses at the
end of the plan period; and
– The discount rates assumed in the valuation of the Group’s
businesses.
Fair, balanced and understandable
The Committee assessed whether the Annual Report, taken as
a whole, is fair, balanced and understandable and provides the
information necessary for shareholders to assess the Company’s
position and performance, business model and strategy. This
assessment is supported by the Group’s Disclosure Committee, which
is chaired by the Group General Counsel and Company Secretary who
briefs the Committee on the Disclosure Committee’s work and
findings.
The Committee reviewed the processes and controls that underpin
the Annual Report’s preparation, ensuring that all contributors and
senior management are fully aware of the requirements and their
responsibilities. This included the financial reporting responsibilities of
the Directors under section 172 of the Companies Act 2006 to
promote the success of the Company for the benefit of its members
as well as considering the interests of other stakeholders that will
have an impact on the Company’s long-term success.
The Committee reviewed an early draft of the Annual Report at its
March meeting to enable input and comment. The review is
performed in conjunction with the ESG Committee during the joint
meeting in May, which also included the review of TCFD and
ESG-related disclosures. The Committee also reviewed the results
announcement, supported by the work of the Group’s Disclosure
Committee, which reviews and assesses the appropriateness of
investor communications.
This work enabled the Committee to provide positive assurance to the
Board to assist it in making the statement required by the Code.
Significant financial reporting judgements
The areas considered and actions taken by the Committee in relation
to the 2024 consolidated financial statements are outlined below and
overleaf. For each area, the Committee was satisfied with the
accounting and disclosures in the consolidated financial statements.
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Governance (continued)
Regulators and our financial reporting
The Financial Reporting Council (‘FRC’) publishes thematic reviews
and other guidance to help companies improve the quality of
corporate reporting through the provision of guidance and reviews of
the quality of reporting across public companies. The Group routinely
reviews FRC publications, the most relevant publications for the 2024
Annual Report being:
– Annual review of corporate reporting;
– Annual review of corporate governance reporting; and
– Thematic reviews on existing disclosure requirements for (i) IFRS 13
‘Fair value measurement’ and (ii) Climate-related metrics and
targets.
The Group already complied with the majority of the
recommendations and the 2024 Annual Report has been updated to
adopt best practice where appropriate.
We reviewed the minimum standard for Audit Committees that was
published by the FRC in May 2023. The Committee follows the
working practices in the guidance with necessary disclosure provided
in the Annual Report. Consequently, the guidance has not resulted in
any substantive changes for the Committee.
Draft regulations for new UK corporate reporting requirements were
withdrawn by the UK Government in October 2023, and it was
announced that simpler and more targeted reforms will be
considered in the future. We continue to track developments in this
area to ensure that we will be well placed to implement any changes,
as applicable, in the years ahead.
In January 2024, the FRC published an updated UK Corporate
Governance Code (‘revised Code’). The implementation date will be
the year ending 31 March 2026 for the Group, excluding the
enhanced internal control requirements in the revised Code where
implementation is required for the year ending 31 March 2027. The
Committee will work with management to identify the scope of our
material internal controls and the level of internal attestation work
that will be performed in order to support the Board’s declaration of
effectiveness of the controls. We expect to leverage from our
established controls programme, which underpins our existing US
reporting obligations.
In January 2024, the US Securities and Exchange Commission (‘SEC’)
raised a comment in relation to the commentary on our financial
performance that was included in our Form 20-F for the year ended
31 March 2023. We submitted our written response to the SEC which
was accepted, and their review was closed in January 2024. This
review will result in a number of enhancements in our disclosures
which will be included in our Form 20-F for the year ended 31 March
2024.
Area of focus
Actions taken
Liability provisioning
The Group is subject to a range of claims and legal actions from a
number of sources, including, but not limited to, competitors,
regulators, customers, suppliers and, on occasion, fellow
shareholders in Group subsidiaries.
See note 16 ‘Provisions’ and note 29 ‘Contingent liabilities and legal
proceedings’ in the consolidated financial statements.
The Committee met with the Director of Litigation in November
2023 and May 2024 in advance of the half-year and year-end
reporting, respectively.
The Committee reviewed and challenged management’s assessment
of the status of the most significant claims, together with relevant
legal advice received by the Group, to form a view on the level of
provisioning and appropriateness of disclosures in the consolidated
financial statements.
Taxation
The Group is subject to a range of tax claims and related legal actions
in several jurisdictions where it operates. Furthermore, the Group has
extensive accumulated tax losses, and a key management
judgement is whether a deferred tax asset should be recognised in
respect of those losses.
See note 6 ’Taxation’ and note 29 ’Contingent liabilities and legal
proceedings’ in the consolidated financial statements.
The Committee met with the Group Tax Director in November 2023
and May 2024 in advance of the half-year and year-end financial
reporting, respectively. The Committee challenged the judgements
underpinning tax provisioning, deferred tax assets and related
disclosures.
Revenue recognition
Revenue is a risk area given the inherent complexity of IFRS 15
accounting requirements and the underlying billing and related IT
systems.
See note 1 ‘Basis of preparation’ in the consolidated financial
statements.
The accounting policy for and related disclosure requirements of
IFRS 15 that have been presented in the Annual Report were
reviewed in March and May 2024.
The Committee considered the scope of EY’s planned revenue audit
procedures and their related audit findings and observations at its
meetings in November 2023 and May 2024.
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Internal control and risk management
The Committee has the primary responsibility for the oversight of the
Group’s system of internal control, including the risk management
framework, the compliance framework and the work of the Internal
Audit function.
Internal Audit
The Internal Audit function provides independent and objective
assurance over the design and operating effectiveness of the system
of internal control, through a risk-based approach. The function
reports into the Committee and, administratively, to the Chief
Financial Officer. The function is composed of teams across Group
functions and local markets. This enables access to specialist skills
through centres of excellence and ensures local knowledge and
experience. Cooperation with professional bodies and an information
technology research firm has ensured access to additional specialist
skills and an advanced knowledge base.
Internal Audit activities are based on a robust methodology and the
internal quality assurance improvement programme ensures
conformity with the International Professional Practices framework,
which includes the IIA standards and code of ethics and the
continuous development of the audit methodology applied. The
conformity is reviewed and verified through an external quality
assessment by an independent consultancy firm every three years.
The Committee has a standing agenda item to cover Internal
Audit-related topics. Prior to the start of each financial year, the
Committee reviews and approves the annual audit plan, assesses the
adequacy of the budget and resources and reviews the strategic
initiatives for the continuous improvement of the function’s
effectiveness. The audit plan is determined by considering Internal
Audit’s rolling review framework and the outputs of a data-driven risk
assessment.
The Committee reviews progress against the approved audit plan and
the results of Internal Audit activities, with a strong focus on
unsatisfactory audit results and cross-entity audits, which are audits
that are performed across multiple markets with the same scope.
Audit results are analysed by process and entity to highlight both
changes in the control environment and areas that require attention.
During the year, Internal Audit coverage focused on principal risks,
including Cyber threat, Data management and privacy and Adverse
macro-economic conditions.
Through the thematic reviews, assurance was provided across a broad
range of areas, including: customer device financing; discount
management; Vodafone Business billing processes; M-Pesa
operations; security of enterprise customer-provided equipment
(‘CPE’); management of end-of-life software risks; identity
management; shadow IT; management of network stock;
management of payment systems; data privacy; management of
customer master data; and the physical security of critical assets. The
activities performed by the shared service organisation continue to
receive ongoing focus due to their significance across many
processes.
Management is responsible for ensuring that issues raised by Internal
Audit are addressed within an agreed timetable, and the Committee
reviews their timely completion.
The last independent review of the effectiveness of the Group’s
Internal Audit function was performed by Deloitte LLP in January
2022, and the results were presented to the Committee. The review
concluded that the Internal Audit function operated in accordance
with the Global Institute of Internal Auditors’ International
Professional Practices Framework, is at the top of its peer group range
and demonstrates areas of innovative practice.
The Internal Audit function continues to invest in several initiatives to
improve its effectiveness, particularly in the adoption of new
technologies. The innovative use of data analytics has provided
broader and deeper audit testing and driven increased insights.
Assessment of the Group’s system of internal control,
including the risk management framework
The Group’s risk assessment process and the way in which significant
business risks are managed is an area of focus for the Committee.
The Committee’s activity here was led primarily, but not solely, by the
Group’s assessment of its principal and emerging risks and
uncertainties. Cyber threats remain a major focus for the Committee
given the continual threats in this area.
The Group has an internal control environment designed to protect
the business from the material risks that have been identified.
Management is responsible for establishing and maintaining adequate
internal controls and the Committee has responsibility for ensuring
the effectiveness of those controls.
The Committee reviewed the process by which Group management
assessed the control environment, in accordance with the
requirements of the Guidance on Risk Management, Internal Control
and Related Financial and Business Reporting published by the FRC.
This activity was supported by (i) reports from the Group Audit
Director, (ii) a review of the Group’s principal risks with the Global
Head of Risk, (iii) a review of the Group’s second line of defence and
policy simplification with the Group General Counsel and Company
Secretary, and (iv) a fraud update from the Global Corporate Security
and Resilience Director and Global Head of Fraud Management and
Investigations.
The Group operates a ‘Speak Up’ channel that enables employees to
anonymously raise concerns about possible irregularities. The
Committee received an update on the operation of the channel
together with the output of any resulting investigations.
The Committee has completed its review of the effectiveness of the
Group’s system of internal control, including risk management, during
the year and up to the date of this Annual Report. The review covered
all material controls including financial, operating and compliance
controls. The Committee confirms that the system of internal control
operated effectively for the 2024 financial year. Where specific areas
for improvement were identified, mitigating alternative controls and
processes were in place. This allows us to provide positive assurance
to the Board to help fulfil its obligations under the Code.
Compliance with section 404 of the US Sarbanes-Oxley Act
Oversight of the Group’s compliance activities in relation to section
404 of the US Sarbanes-Oxley Act and policy compliance reviews also
fall within the Committee’s remit.
Management is responsible for establishing and maintaining adequate
internal controls over financial reporting, and we have responsibility
for ensuring the effectiveness of these controls. The Committee
received updates on the Group’s work in relation to section 404
compliance and the Group’s broader financial control environment
during the year. We continue to challenge management on ensuring
the nature and scope of control activities evolve to ensure key risks
continue to be adequately mitigated.
The Committee also took an active role in monitoring the Group’s
compliance activities, including receiving reports from management
in the year covering programme-level strategy, the scope of
compliance work performed and the results of controls testing. The
external auditor also reports the status of its work in relation to
controls in its reports to the Committee.
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Long-term viability statement and
going concern assessment
The Committee provides advice to the Board on the form and basis of
conclusion underlying the long-term viability statement and the
going concern assessment.
Read more about the long-term
viability statement on page 63
Read more about the going concern
assessment on page 124
At our meeting in May 2024, the Committee challenged management
on its financial risk assessment as part of its consideration of the
long-term viability statement. This included scrutiny of forecast
liquidity, balance sheet stress tests, the availability of cash and cash
equivalents through new or existing financing facilities and a review of
counter-party risk to assess the likelihood of third parties not being
able to meet contractual obligations. This comprehensive assessment
of the Group’s prospects made by management included
consideration of:
– The review period and alignment with the Group’s internal
long-term forecasts;
– The assessment of the capacity of the Group to remain viable after
consideration of future cash flows, expected debt service
requirements, undrawn facilities and access to capital markets;
– The modelling of the financial impact of severe but plausible risk
scenarios materialising; including a sensitivity if expected M&A
transactions fail to complete within the assessment period;
– The inclusion of clear and enhanced disclosures in the Annual
Report as to why the assessment period selected was appropriate
to the Group, what qualifications and assumptions were made and
how the underlying analysis was performed, consistent with
FRC pronouncements; and
– Comprehensive disclosure in relation to the Group’s liquidity
provided in the consolidated financial statements. See note 22
‘Capital and financial risk management’ in the consolidated
financial statements.
External audit
The Committee has primary responsibility for overseeing the
relationship with the external auditor, EY. This includes making the
recommendation on the appointment, reappointment and removal
of the external auditor, assessing its independence on an ongoing
basis, and approving the statutory audit fee, the scope of the statutory
audit and the appointment of the lead audit engagement partner.
Alison Duncan has held this role for five years since the appointment
of EY as external auditor for the year ended 31 March 2020. The lead
audit partner role will rotate to Michael Rudberg, an existing partner
on the audit team, for the year ending 31 March 2025.
EY presented to the Committee its detailed audit plan for the 2024
financial year, which outlined its audit scope, planning materiality and
its assessment of key audit risks. The identification of key audit risks is
critical in the overall effectiveness of the external audit process and
these are outlined in the Auditor’s report.
The Committee also received reports from EY on its assessment
of the accounting and disclosures in the financial statements and
financial controls.
The last external audit tender took place in 2019, which resulted in
the appointment of EY. The Committee will continue to review the
auditor appointment and anticipates that the audit will be put out to
tender at least every 10 years. In deciding when to conduct an
external audit tender, the Committee considers a range of factors,
including the potential cost and efficiency benefits of retaining the
incumbent auditor. The Company has complied with the Statutory
Audit Services Order 2014 for the financial year under review.
Read the Auditor’s report
on pages 125 to 134
Independence and objectivity
In its assessment of the independence of the auditor, and in
accordance with the US Public Company Accounting Oversight
Board’s (‘PCAOB’) standard on independence, the Committee received
details of all relationships between the Company and EY that may
have a bearing on its independence and received confirmation from
EY that it is independent of the Company in accordance with US
federal securities law and the applicable rules and regulations of the
SEC and the PCAOB.
Effectiveness of the external audit process
The Committee reviewed the quality of the external audit process
throughout the year and considered the performance of EY.
This comprised the Committee’s own assessment and the results of a
detailed feedback survey of senior personnel across the Group. Based
on these reviews, the Committee concluded that there had been
appropriate focus and challenge by EY on the primary areas of the
audit and that EY had applied robust challenge and scepticism
throughout the audit.
EY audit and non-audit fees
Total fees payable to EY for audit and non-audit services in the year
ended 31 March 2024 amounted to €36 million (FY23: €31 million).
Audit fees
The Committee reviewed and discussed the fee proposal, was
engaged in agreeing audit scope changes and, following the receipt
of formal assurance that its fees were appropriate for the scope of the
work required, agreed an audit fee of €26 million for statutory audit
services in the year (FY23: €28 million).
Non-audit fees
To protect the independence and objectivity of the external auditor,
the Committee has a policy for the engagement of the external
auditor to provide non-audit services. The policy prohibits EY from
playing any part in management or decision-making, providing certain
services such as valuation work and the provision of accounting
services. The Group’s non-audit services policy incorporates the
requirements of the FRC’s Ethical Standard, including a ‘whitelist’ of
permitted non-audit services which mirrors the FRC’s Ethical Standard.
The FRC published a revised Ethical Standard in January 2024. The
Group’s non-audit services policy will be updated to incorporate the
changes in the revised Ethical Standard and will be approved by the
Committee ahead of the December 2024 effective date.
The Committee has pre-approved that EY can be engaged by
management, subject to the policies set out above, and subject to:
– A €60,000 fee limit for individual engagements;
– A €500,000 total fee limit for services where there is no legal
alternative; and
– A €500,000 total fee limit for services where there is no practical
alternative supplier.
For those permitted services that exceed these specified fee limits,
the Committee Chair pre-approves the service.
Non-audit fees were €10 million (FY23: €3 million). The level of
non-audit fees in the year ended 31 March 2024 is significantly higher
than recent years. This is primarily attributable to Reporting
Accountant services that have been provided by EY in connection
with the proposed merger of Vodafone UK with Three UK and other
audit-related services associated with the disposal of Vodafone Spain.
See note 3 ‘Operating profit’ in the consolidated financial statements.
Governance (continued)
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Technology committee
The role of the Technology Committee is to support the Board by
providing expert oversight and monitoring of the Group’s technology
strategy, as well as assessing technology risks, understanding
resource and talent requirements, and exploring new innovations that
may enable future growth.
Chair
Simon Segars
Members
Deborah Kerr
Delphine Ernotte Cunci
Stephen A. Carter CBE
Key responsibilities
The responsibilities of the Committee are to:
– Oversee, monitor and challenge the Group’s technology strategy.
– Review long term technology plans and budgets including capital
investment, resourcing, skills and prioritisation.
– Understand future technology developments, industry trends and
technology innovation that may impact the company strategy.
– Review technology risks, disruptors and mitigations.
– Participate in deep dives into particular topics, innovations or plans.
– Assess whether the technology strategy is consistent and enabling
the overall company strategy.
– Review technology strengths, weaknesses, opportunities and
threats with executive management to oversee actions being taken
in each area. This will include a focus on disruptors and risks that
could adversely impact the strategy.
– Review significant transformation and technology programmes.
– Review technology supply chain, partnerships and external
relationships that underpin the strategy.
Letter from Committee Chair
On behalf of the Board, I am pleased to present Vodafone’s
Technology Committee Report for the year ended 31 March 2024.
The Committee was established in 2023 with the founding members
bringing a wide range of experience across domains that relate to
technology and strategy.
This year, the Committee met three times, in July 2023, November
2023 and January 2024. Each meeting agenda included a range of
topics across the Committee’s areas of responsibility.
An important objective of the Committee is to provide external
perspectives and challenge into the technology strategy and
direction. Furthermore, topics reviewed during Committee meetings
in 2023/2024 on key areas such as future network strategy, Internet
of Things ecosystem, Artificial Intelligence (‘AI’) and how technology
strategy underpins the company strategy, have enabled Committee
members to lead and support broader technical discussions with the
main Plc Board.
I have reported this year’s Committee work to the Board and I am
looking forward to the next year chairing the Committee, starting
with the next meeting in May 2024.
Simon Segars
On behalf of the Technology Committee
14 May 2024
Click or scan to watch the Chair of the Technology Committee explain his role:
investors.vodafone.com/videos
Focus during the year
The Technology Committee met with senior leaders of the
technology team including the Chief Technology Officer, Chief
Network Officer and others on three occasions during the year
ended 31 March 2024. The following provides a summary of the
topics covered.
July 2023
In the first meeting the proposed terms of reference were reviewed
and approved. The objective of this session was to set the foundation
and context for future discussion and deep dive topics that directly
support Vodafone’s technology strategy and vision.
Vodafone’s approach to technology strategy development and its
operating model were explained.
The Committee discussed Vodafone’s five-year technology strategy
and individual workstreams. 5G network deployment and the
development of global platforms were particular areas of focus. Cyber
security was also discussed, with the Committee reflecting on the
changing business, technology, and threat landscape.
November 2023
This session included deep dives on a range of topics including the
prioritisation process that drives execution of the technology strategy
and its links to the company’s annual planning cycle.
We discussed how strategy and plans are shaped to address
regulatory changes, macro-economic and geopolitical factors.
A digital and IT presentation focused on customer experience and
service as well as global platforms.
January 2024
In January this year, we explored how the technology team is
supporting Vodafone Business’ growth ambitions over the next five
years, including target outcomes. Our IoT portfolio and underlying
technologies were also discussed, including the future investment
roadmap for key products.
Priorities, delivery targets and outcomes for FY25 were discussed with
the Committee with focus on direct contribution to company
priorities around Customer, Simplicity and Growth.
Finally, the Committee were briefed on Vodafone’s AI, Machine
Learning and Generative AI capabilities and partnerships ahead of a
deep dive scheduled for May 2024.
Key focus for the next year
Next year we expect to continue to look at existing and new
technologies that drive innovation, company strategy and growth,
focusing on how technology enables customer service and builds
trust. Strategy discussions will consider how we manage both
opportunities and risks.
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In 2021, the Board formally approved the
establishment of a new Committee of the Board,
the ESG Committee. The role of the Committee is
to provide oversight of Vodafone’s Environmental,
Social and Governance (‘ESG’) programme, to
monitor the Purpose agenda in relation to
Empowering People, Protecting the Planet and
ensuring that Vodafone Maintains Trust.
Chair
Amparo Moraleda
Members
Jean-François van Boxmeer
Christine Ramon
Simon Segars
Key responsibilities
The responsibilities of the Committee are to:
– Provide oversight of the Vodafone Group ESG programme and
monitor the Purpose agenda;
– Review and provide guidance on the implementation of the ESG
strategy, and related policies and programmes required to
implement the ESG strategy;
– Monitor progress against KPIs and external ESG indices; and
– Provide joint oversight and effective governance with the Audit and
Risk Committee (‘ARC’) over the ESG content within the Annual
Report, the ESG Addendum and other disclosures with ESG content.
Click to read the Committee’s terms of reference:
vodafone.com/board-committees
Letter from Committee Chair
On behalf of the Board, I am pleased to present Vodafone’s ESG
Committee report for the year ended 31 March 2024.
On establishment of the Committee in 2021, I was appointed as Chair
due to my experience in ESG topics and my tenure as a member of
the Board of Trustees of the Vodafone Foundation since 2020. In
November 2022, we were delighted to welcome a new Committee
member, Simon Segars, who brings a wealth of experience from his
career in the electrical engineering field to the Vodafone Board and
the ESG Committee. In 2023, the Committee underwent a substantial
change to its structure, as two of my fellow founding members, Dame
Clara Furse and Valerie Gooding, retired from the Committee after
building a strong foundation from which our new members will drive
the strategy to the next phase.
To emphasise ESG as a strategic priority, our Board Chair, Jean-
François van Boxmeer, joined the ESG Committee, in addition to his
role on the Nominations and Governance Committee. Jean-François
was Chief Executive of Heineken for 15 years and provides important
perspectives having held senior roles across Africa and Europe before
becoming Chair of the Vodafone Board in 2020.
Christine Ramon completes the ESG Committee. Her extensive
experience in senior finance roles, specifically at AngloGold Ashanti,
energy and chemicals company Sasol, and as non-executive director
at telecommunications company MTN Group Ltd, both in South Africa,
offer invaluable insights to many markets in which Vodafone operates.
Her position on the ARC ensures that where ESG concepts converge
with risk and compliance topics, we can take an integrated approach.
In FY23, the Board took the decision to evolve ESG governance and
increase the cadence of ESG Committee meetings to three per
annum. This additional engagement is a joint session with the ARC, to
stay ahead of the constantly changing ESG landscape, ensure a
holistic perspective on the issues that impact both committees and
implement additional controls on disclosures, within the Annual
Report and the ESG Addendum and Methodology document,
for which we have introduced a collaborative responsibility.
The other two Committee meetings in FY23 ensured further
development of the relationships with the senior leaders who lead the
Purpose agenda, drive the strategies to deliver against the KPIs and
engage Vodafone employees in supporting positive change in all ESG
areas. The wide variety of topics and thorough papers ensured a
comprehensive view of the ESG programmes. Deep dives with subject
matter experts were conducted to develop detailed knowledge on
specific strategies, KPIs and progress against them along with
discussions around future direction.
Multiple discussions with Joakim Reiter, Chief External and Corporate
Affairs Officer, have reinforced that ESG is at the core of Vodafone’s
purpose and is a key element in the execution of the corporate
strategy, as well as a driver of commercial success. The approach to
ESG brings together five key programmes:
– Purpose and the actions Vodafone takes within our Purpose
strategy relating to Empowering People, Protecting the Planet
and Maintaining Trust;
– Oversight of Vodafone’s ESG strategy and performance to
ensure an effective ESG programme;
– Conducting business with integrity, to ensure Vodafone
operates to the highest possible standards of integrity and ethics,
and that Vodafone is ‘Doing What’s Right’ towards customers,
colleagues, communities and co-partners;
– Transparency, including providing correct disclosures and
reporting, as well as external positioning, engagement and
communication on all material ESG aspects; and
– Measurement, ensuring that the data that we use to track
progress on ESG metrics is of high quality and reliable, to provide
insights for strategic focus.
The transformation programme to move ESG data reporting to the
finance function continues to evolve and support the delivery of
substantial improvements in our non-financial data through the
development of a robust control environment, alongside policies, to
progress our ESG objectives.
On behalf of the Committee, I have reported on the FY24 work to the Board,
and I am looking forward to FY25; starting with the joint ESG and ARC
Committee meeting in May 2024 to review annual reporting.
The Committee will continue oversight and scrutiny of Vodafone’s
ESG agenda, including further presentations from senior executives
and experts from across the Group. We will review progress on each of
Vodafone’s ESG strategies and the pathways in place to meet our ESG
goals in Group and across markets. Consideration of the following
stakeholder interests will remain part of the Committee’s responsibility:
– Investors: Strong Board-level ESG governance is a key
requirement of an effective ESG programme;
– Governments and regulators: Local and international legal and
regulatory obligations on ESG topics continue to increase;
– Local communities and NGOs: ESG topics affect the day-to-day
lives of the people in the communities that we serve;
– Suppliers and customers: Upholding high ethical standards
throughout our value chain is critical for stakeholders when
deciding whether they should do business with Vodafone; and
– Employees take pride in working for a purpose-driven organisation
that is enabling an inclusive, sustainable and trusted digital society.
Amparo Moraleda
On behalf of the ESG Committee
14 May 2024
ESG Committee
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Click or scan to watch the Chair of
the ESG Committee explain her role:
investors.vodafone.com/videos
Click to read more about
Vodafone’s approach to
ESG reporting:
vodafone.com/
sustainability-reports
Environment
Read more
Energy consumption and GHG emissions E
Including energy sources, uses and targets
38-41
Circularity and other environmental topics E
Including device and network waste, water and plastics
41-42
Environmental benefits from
products and services E
Including carbon and resource efficiency enablement
41-42
Climate change risk management A
E
Including alignment with TCFD recommendations
64-69
Social
Read more
Safety, health and wellbeing B
19-20
Workplace equality and
employee experience B
17-19
Employee rights
A
B
Including collective bargaining, grievance
mechanisms, Speak Up, Fair Pay and labour standards
17
44
51-52
Responsible supply chain B
E
Including labour standards and sourcing of minerals
51-53
Human and digital rights A
E
Including privacy regulations, right to privacy and
freedom of expression, and other human rights
45-46
51-52
Socio-economic benefits from
products and services E
Including digital inclusion
33-37
Governance
Read more
Mobile, masts and health B
51
Security A
B
Including cyber and other security topics
46-51
Anti-bribery and corruption A
53-54
Business conduct and ethics A
Including taxation, business conduct and compliance
53-54
Corporate governance N
70-85
Reporting
B
E
A
Including Annual Report and Accounts,
Climate-related risks, Modern Slavery Statement
and voluntary ESG disclosures
1-85
Focus during the year
The ESG Committee met three times during the year ended 31 March
2024. The following provides a summary of the topics covered.
May 2023
The inaugural joint ARC and ESG Committee provided a full review of
all ESG annual reporting documents, including the Task Force on
Climate-related Financial Disclosures (‘TCFD’) report and the ESG
Addendum. The Committees received papers outlining key changes
made since the previous annual report, including the strategic approach
and the scope of the assurance plan. The Committees were satisfied
with the proposals.
November 2023
– Review of the ESG strategy and its evolution since the
establishment of the Committee in 2021. The paper submitted by
Joakim Reiter, Chief External and Corporate Affairs Officer, provided
details on three key strategic evolutions prompted either by changes in
Vodafone Group or developments in the external environment:
simplification of ESG targets, integration of ESG into business
priorities, and the continued evolution of ESG data management.
– The Executive Committee sponsor of Vodafone’s inclusion
programme, Serpil Timuray, CEO of Vodafone Investments,
provided an overview of the strategy and a progress update on KPIs
in relation to customers, communities, colleagues and co-partners.
– Leanne Wood, Chief Human Resources Officer, presented feedback
from Vodafone’s female employees on the gender diversity
programme, the achievements to date and the actions planned to
further improve the gender diversity programme.
– The Committee was also assured by the papers submitted on ESG
rankings and indices and the approach to ESG half-year reporting.
March 2024
Joakim Reiter, delivered key ESG developments at the March Committee:
– Vodafone’s purpose was refreshed to reflect that everything we do
in Vodafone aims to create a digital society, and we ensure that this
digital society is inclusive, sustainable and responsible through
three purpose differentiators: Empowering People, Protecting the
Planet and Maintaining Trust.
– The Committee welcomed the opportunity to review Vodafone’s
Climate Transition Plan, which details the necessary actions to
achieve our net zero ambitions. This will be published as part of our
FY24 reporting suite, and is a summary of our strategy with
cross-functional objectives and governance to reduce emissions
and manage our climate-related risks and opportunities.
– Vodafone’s approach to ESG reporting for FY24 was noted in a
paper along with the results from a recent internal audit that
reviewed: ESG global targets; policies and procedures;
implementation and monitoring of programmes; local metrics
calculation and reporting; and Group consolidation and disclosures.
Key focus for the next year
– Continuing to review progress of the ESG strategy, including performance
against targets and performance in ESG indices and rankings;
– Reviewing progress in embedding key purpose targets and
practices into Vodafone’s operations and commercial strategy;
– Reviewing Vodafone’s alignment to external ESG disclosure standards
such as ISRS1, CSRD2 and ESRS3; and
– Continued oversight of the ESG data management programme.
Key
Audit and Risk Committee
ESG Committee
Nominations and
Governance Committee
Full Board
A
E
N
B
Mapping of ESG topics
When establishing the ESG Committee and setting its remit, we
completed a mapping of all key ESG topics for Vodafone, to ensure
clarity on the role of the ESG Committee alongside the Board and
other relevant committees. This is presented below, with further
details of each ESG topic.
Notes:
1. International Standard on Related Services.
2. Corporate Sustainability Reporting Directive.
3. European Sustainability Reporting Standards.
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Letter from the Remuneration
Committee Chair
On behalf of the Board, I present our 2024
Directors’ Remuneration Report.
This report includes both our Policy Report (as approved by
shareholders at the 2023 AGM), and our 2024 Annual Report on
Remuneration, which sets out how our policy was implemented during
the year under review and how it will be applied for the year ahead.
Activities during the year
In the last year we have seen good progress in delivering against our
strategic goals of Customers, Simplicity, and Growth, and in
transforming our company to support these ambitions. We recognise
how important it is to stay connected with our employees during this
period of change, and as a result continue to collect feedback
through our Spirit Beat survey and other employee listening
initiatives. Our workforce engagement leads, Christine Ramon and
Delphine Ernotte Cunci, have also attended forums in Europe and
Africa to understand the perspectives of employees across all our
markets. The key topics raised by employee representatives this year
included our company transformation, market portfolio, the
development of our employees, and the experience of our customers.
As set out in last year’s letter, we launched our remuneration policy
consultation with our largest shareholders last year and engaged
with a variety of investor bodies and proxy agencies. We were
pleased to see that our Policy Report was approved by over 95% of
shareholders at the 2023 AGM. The Committee would like to thank
those that provided feedback leading up to this and we continue
to engage with investors on the implementation of our 2024
Annual Report on Remuneration.
Alignment with our strategy and culture
During the year we made announcements regarding the sale of
Vodafone Spain and Vodafone Italy and outlined the binding
agreement to combine our UK business. These reflect the
advancements we have made in right-sizing our European portfolio
for optimal growth. We also made good early progress with improving
the experience of customers and transforming our operations to
remove complexity and accelerate growth.
To support and reinforce these priorities, we updated the structure of
our Global Short Term Incentive plan to categorise measures under
Growth and Customers. In the case of the latter, we split out our NPS,
Churn and Revenue Market Share metrics into separate measures,
following the previous approach of categorising these under a single
Customer Appreciation metric. This has ensured dedicated focus, and,
in the case of NPS, where we specifically review the reduction of deep
detractor customers, we have seen a reduction in a majority of our markets.
We continue to use adjusted free cash flow across our incentive plans
to reinforce the importance of cash generation in creating value for
our business and when applying rigorous capital discipline in investment
decisions. We also use adjusted service revenue and adjusted EBIT in
our Global Short Term Incentive plan to focus on the importance of
delivering operating efficiencies when maximising profit and revenue.
The Committee evaluates the remuneration decisions, outcomes, and
structures in the context of our evolving company strategy, and this
will inform any changes to our Policy Report which will be reviewed in
the forthcoming year.
Read more about our strategy and culture
on pages 9 and 80 of this Annual Report
Fair pay
During the year we continued to make interventions across our
business to support our colleagues in countries where inflationary
and cost of living pressures were being felt. This included targeted
support in markets including, but not limited to, Germany, Ireland,
Egypt, and Turkey. The type of support used was tailored to specific
market circumstances but included additional or accelerated salary
reviews and the provision of extra cash allowances.
When making decisions on executive remuneration the Committee
considers pay in the wider context including arrangements elsewhere
in the business, our fair pay principles and stakeholder considerations.
Read more
on page 113
Arrangements for 2025
Base salary and pension arrangements
Prior to the 2024 review, the salaries for both Executive Directors had
been unchanged following their respective appointments to the roles
of Group Chief Executive and Group Chief Financial Officer.
Following the 2024 salary review, the Committee agreed that
salaries for both Executive Directors would remain unchanged.
The Committee felt this was appropriate considering Margherita
Della Valle’s salary increase following her permanent appointment
as Group Chief Executive in April 2023, and given Luka Mucic’s salary
was set appropriately when he joined as Chief Financial Officer in
September 2023.
Pension arrangements for Executive Directors will continue to remain
aligned with the wider UK workforce at 10% of base salary.
Annual bonus (‘GSTIP’)
During the year the Committee determined that measures and
weighting under the 2025 annual bonus will remain unchanged from
those used in the 2024 plan:
– Growth (70%): service revenue (20%), adjusted EBIT (20%),
adjusted free cash flow (20%) and revenue market share (10%).
– Customers (30%): Net Promoter Score (20%) and churn (10%).
Global long-term incentive (‘GLTI’)
The Committee determined that the GLTI will remain unchanged for
2025. The measures under the long-term incentive will continue to
be weighted at 60% adjusted free cash flow, 30% relative TSR and
10% ESG.
Read more
on pages 117 to 118
Performance outcomes during 2024
GSTIP performance (1 April 2023 – 31 March 2024)
Annual bonus performance during the year was measured against
both financial and strategic measures aligned to our strategic
priorities of Growth and Customers. The four measures underpinning
Growth, equivalent to 70% of the award, include service revenue
(20%), adjusted EBIT (20%), adjusted free cash flow (20%), and
revenue market share (10%). The measures under the Customers
element of the award, equivalent to 30% of the award, include Net
Promoter Score (20%) and Churn (10%).
Performance under the financial and strategic measures was
consistent with or above the mid-point of the target range. The
combined performance resulted in an overall bonus payout of 71.2%
of maximum.
Read more
on pages 107 and 108
Remuneration Committee
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GLTI performance (1 April 2021 – 31 March 2024)
The 2022 GLTI award (granted August 2021) was subject to adjusted free cash flow (‘FCF’) (60% of total award), relative TSR (30% of total award),
and ESG (10% of total award) performance. All performance conditions were measured over the three-year period ending 31 March 2024.
Final adjusted FCF performance finished above the mid-point of the range resulting in 65.3% of the adjusted FCF element vesting. Relative TSR
performance was below the median of the peer group resulting in no vesting under this measure. ESG performance was assessed against three
metrics and vested at 96.9%. This resulted in an overall vesting percentage for the 2021 GLTI of 48.9% of maximum.
Read more
on pages 108 and 109
Consideration of discretion
The Committee reviewed the appropriateness of the outcomes of both the annual bonus and long-term incentive plan in light of both the
relevant performance targets and wider internal and external considerations, including the wider employee experience, across the respective
measurement periods. The Committee also acknowledged that no windfall gains had occurred under the long-term incentive plan. It was agreed
that the outcomes were appropriate and that no adjustments were required.
Looking ahead
Over the course of the next 12 months the Committee will be reviewing the current Remuneration Policy to ensure it continues to support our
Company strategy. If any necessary changes are required, these will be shared for consultation ahead of the Policy Report being finalised for
approval.
The rest of this report sets out both our Policy Report, as approved at the 2023 AGM, and our Annual Report on Remuneration, which sets out the
decisions and outcomes summarised in this letter in further detail.
Amparo Moraleda
On behalf of the Remuneration Committee
14 May 2024
Remuneration at a glance
Component
2024 (year ending 31 March 2024)
2025 (year ending 31 March 2025)
Fixed pay
Base salary
Effective 27 April 2023:
Group Chief Executive: £1,250,000.
Effective 1 September 2023:
Group Chief Financial Officer: £760,000.
Effective 1 July 2024:
Group Chief Executive: £1,250,000 (no increase).
Group Chief Financial Officer: £760,000 (no increase).
Benefits
Travel related benefits and private medical cover.
Travel related benefits and private medical cover.
Pension
Pension contribution of 10% of salary.
Pension contribution of 10% of salary.
Annual bonus
GSTIP
Opportunity (% of salary):
Target: 100%/Maximum: 200%
Measures:
Service revenue (20%), adjusted EBIT (20%), adjusted FCF
(20%), revenue market share (10%), Net Promoter Score
(20%) and churn (10%).
Opportunity (% of salary):
Target: 100%/Maximum: 200%
Measures:
Service revenue (20%), adjusted EBIT (20%), adjusted FCF
(20%), revenue market share (10%), Net Promoter Score
(20%) and churn (10%).
Long-term incentive
GLTI
Opportunity (% of salary – maximum):
Chief Executive: 500%/Other Executive Directors: 450%
Measures:
Adjusted free cash flow (60%), relative TSR (30%),
and ESG (10%).
Performance/holding periods:
Three-year performance + two-year holding period.
Opportunity (% of salary – maximum):
Chief Executive: 500%/Other Executive Directors: 450%
Measures:
Adjusted free cash flow (60%), relative TSR (30%),
and ESG (10%).
Performance/holding periods:
Three-year performance + two-year holding period.
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Remuneration Policy
Remuneration Policy – notes to reader
No changes have been made to our policy since its approval at the 2023 Annual General Meeting which was held on 25 July 2023. Our approved
Policy Report is available on our website at vodafone.com, and has been reproduced below in the shaded boxes exactly as it was set out in the
2023 Annual Report. As such some of the policy wording, including references to the 2023 Annual General Meeting and page number references,
is now out of date.
Remuneration Policy
In this forward-looking section we describe our Remuneration Policy for the Board. This includes our considerations when determining policy,
a description of the elements of the reward package, including an indication of the potential future value of this package for the Executive
Directors, and the policy applied to the Chair and Non-Executive Directors.
We will be seeking shareholder approval for our Remuneration Policy at the 2023 Annual General Meeting (‘AGM’) and we intend to implement
it at that point. A summary and explanation of the proposed changes to the current Remuneration Policy is provided on page 85. The proposed
Remuneration Policy submitted for shareholders’ approval at the 2023 AGM does not differ substantively from the Remuneration Policy
approved by shareholders in 2020 except for changes made to align the terms of the Remuneration Policy with the drafting of the rules of the
new Global Incentive Plan 2023, which is also being submitted for shareholders’ approval at the 2023 AGM. Subject to approval, we will review
our Remuneration Policy each year to ensure that it continues to support our Company strategy and, if it is necessary to make a change to our
Remuneration Policy within the next three years, we will seek prior shareholder approval for the change.
Considerations when determining our Remuneration Policy
To avoid conflicts of interest, the Remuneration Committee is entirely comprised of Non-Executive Directors (who are not eligible to
participate in the Company’s annual bonus or long-term incentive arrangements) and the Remuneration Committee ensures that individuals
are not present when the Remuneration Committee discusses their own remuneration. A critical consideration for the Remuneration
Committee when determining our Remuneration Policy is to ensure that it supports our Company purpose, strategy, and business objectives.
A variety of stakeholder views are taken into account when determining executive pay, including those of our shareholders, colleagues, and
external bodies. Further details of how we engage with, and consider the views of, each of these stakeholders are set out on page 100.
In advance of submitting our Remuneration Policy for shareholder approval we ran a thorough consultation exercise with our major
shareholders. We invited our top 25 shareholders (constituting a combined holding of c.50% of our issued share capital at the time of
engagement) and a number of key governance stakeholders to comment on remuneration at Vodafone and to provide feedback on the
proposed changes to the current Remuneration Policy which was approved at the 2020 AGM. A number of meetings between shareholders
and the Remuneration Committee Chair took place during this consultation period.
Listening to and consulting with our employees is very important and the Remuneration Committee is supportive of the activities undertaken
to engage the employee voice. Our engagement with employees can take different forms in different markets but includes a variety of
channels and approaches including our annual people survey which attracts very high levels of participation and engagement, regular
business leader Q&A sessions, and a number of internal digital communication platforms.
Our Workforce Engagement Lead also undertakes an annual attendance at our European employee forum, and a similar body which covers
our African markets, with any questions or concerns raised by the employee representatives presented directly to the Board for consideration
and discussion. Any actions taken by the Board are then fed back to these forums to ensure a two-way dialogue.
Whilst we do not formally consult directly with employees on the Remuneration Policy nor is any fixed remuneration comparison
measurement used when determining the Remuneration Policy for Executive Directors, the Remuneration Committee is briefed on pay and
employment conditions of employees in the Vodafone Group, with particular reference to the market in which the executive is based. The
Company operates Sharesave, a UK all-employee share plan, as well as other discretionary share-based incentive arrangements, which means
that the wider workforce have the opportunity to become shareholders in the Company and be able to vote on the Remuneration Policy in the
same way as other shareholders. Further information on our approach to remuneration for other employees is given on page 90.
Performance measures and targets
Our Company strategy and business objectives are the primary consideration when we are selecting performance measures for our incentive
plans. The targets within our incentive plans that are related to internal financial measures (such as revenue, profit and cash flow) are typically
determined based on our budgets. Targets for strategic and external measures (such as customer-focused metrics, ESG measures, and total
shareholder return (‘TSR’)) are set based on Company objectives and in light of the competitive marketplace. The threshold and maximum
levels of performance are set to reflect minimum acceptable levels at threshold and very stretching levels at maximum.
As in previous Remuneration Reports, we will disclose the details of our performance metrics for our short- and long-term incentive plans.
However, our annual bonus targets are commercially sensitive and therefore we will only disclose our targets in the Remuneration Report
following the completion of the financial year. We will normally disclose the targets for each long-term award in the Remuneration Report for
the financial year preceding the start of the performance period.
At the end of each performance period we review performance against the targets, using judgement to account for items such as (but not
limited to) mergers, acquisitions, disposals, foreign exchange rate movements, changes in accounting treatment, material one-off tax
settlements etc. The application of judgement is important to ensure that the final assessments of performance are fair and appropriate.
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The Remuneration Policy table
The table below summarises the main components of the reward package for Executive Directors.
Fixed pay: Base salary
Purpose and link
to strategy
To attract and retain the best talent
Operation
Salaries are usually reviewed annually and fixed for 12 months commencing 1 July. Decisions are influenced by:
– the level of skill, experience and scope of responsibilities;
– business performance, scarcity of talent, economic climate and market conditions;
– increases elsewhere within the Group; and
– external comparator groups (which are used for reference purposes only) made up of companies of similar size
and complexity to Vodafone.
Opportunity
Average salary increases for existing Executive Committee members (including Executive Directors) will not normally
exceed average increases for employees in other appropriate parts of the Group. Increases above this level may be
made in specific situations. These situations could include (but are not limited to) internal promotions, changes to
role, material changes to the business and exceptional Company performance.
Performance metrics
None.
Fixed pay: Pension
Purpose and link
to strategy
To remain competitive within the marketplace
Operation
– Executive Directors may choose to participate in the defined contribution pension scheme or to receive a cash
allowance in lieu of pension.
Opportunity
– The pension contribution or cash payment is equal to the maximum employer contribution available to our UK
employees under our Defined Contribution scheme (currently 10% of annual gross salary).
Performance metrics
None.
Fixed pay: Benefits
Purpose and link
to strategy
To aid retention and remain competitive within the marketplace
Operation
– Travel-related benefits. These may include (but are not limited to) a company car or cash allowance, fuel and
access to a driver where appropriate.
– Private medical, death and disability insurance and annual health checks for the Executive Directors and their
families.
– In the event that we ask an individual to relocate we would offer them support in line with Vodafone’s relocation
and international assignment policies. This may cover (but is not limited to) relocation, cost of living allowance,
housing, home leave, education support, and tax equalisation and advice.
– Legal and tax support fees if appropriate.
– Other benefits are also offered in line with the benefits offered to other employees, for example, our all-employee
share plan, mobile phone discounts, maternity/paternity benefits, sick leave, paid holiday etc.
Opportunity
– Benefits will be provided in line with appropriate levels indicated by local market practice in the country of
employment, though no monetary maximum has been set.
– We expect to maintain benefits at the current level but the value of any benefit may fluctuate depending on,
amongst other things, personal situation, insurance premiums and other external factors.
Performance metrics
None.
Malus and clawback
The Remuneration Committee reviews the incentive plan results before any payments are made to executives or any shares vest and has full
discretion to adjust the final payment or vesting if they believe circumstances warrant it. In particular, the Remuneration Committee has the
discretion to use either malus or clawback as it sees appropriate. In the case of malus, the award may lapse wholly or in part, may vest to a
lesser extent than it would otherwise have vested or vesting may be delayed.
In the case of clawback, the Remuneration Committee may recover bonus amounts that have been paid up to three years after the relevant
payment date, or recover share awards that have vested up to five years after the relevant grant date. In line with best practice guidance, the
key trigger events for the use of the clawback arrangements include material misstatement of results, material miscalculation of performance
condition outcomes, the Executive Director’s gross misconduct, or breach of their restrictive covenants, the Executive Director causing a
material financial loss to the Group as a result of reckless or negligent conduct or inappropriate values or behaviour, corporate failure or
serious reputational damage.
Subject to approval of this Remuneration Policy, these arrangements will be applicable to all bonus amounts paid, or share awards granted,
following the 2023 AGM. The current clawback arrangements, which are set out in the Remuneration Policy approved by shareholders at the
2020 AGM, have been applicable to all bonus amounts paid, or share awards granted, since the 2020 AGM.
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Annual bonus – Global Short-Term Incentive Plan (‘GSTIP’)
Purpose and link
to strategy
To drive behaviour and communicate the key priorities for the year.
To motivate employees and incentivise delivery of performance over the one-year operating cycle.
The financial metrics drive our growth strategies whilst also focusing on improving operating efficiencies.
The strategic measures aim to ensure a great customer experience remains at the heart of what we do.
Operation
– Bonus levels and the appropriateness of measures and weightings are reviewed annually to ensure they continue
to support our strategy.
– Performance over the financial year is measured against stretching financial and non-financial performance
targets set at the start of the financial year.
– The annual bonus is usually paid in cash in June each year for performance over the previous year. A mandatory
deferral of 25% of post-tax bonus earned into shares for two years will normally apply except where an Executive
Director has met or exceeded their share ownership requirement. The Remuneration Committee retains the
discretion to adjust the size of the bonus based on the achievement of the relevant performance conditions to
reflect the Company’s and the Executive Director’s underlying performance and any other factors the
Remuneration Committee considers appropriate.
Opportunity
– Bonuses can range from 0 to 200% of base salary, with 100% paid for on-target performance.
Performance metrics
– Performance over each financial year is measured against stretching targets set at the beginning of the year.
– The performance measures normally comprise a mix of financial and strategic measures. Financial measures may
include (but are not limited to) profit, revenue and cash flow with a weighting of no less than 50%. Strategic
measures may include (but are not limited to) customer appreciation KPIs such as churn, revenue market share,
and NPS.
Long-term incentive – Global Long-Term Incentive Plan (‘GLTI’)
Purpose and link
to strategy
To motivate and incentivise delivery of sustained performance over the long term.
To support and encourage greater shareholder alignment through a high level of personal
share ownership.
The use of free cash flow as the principal performance measure ensures we apply prudent cash
management and rigorous capital discipline to our investment decisions.
The use of TSR along with a performance period of not less than three years means that we are focused
on the long-term interests of our shareholders.
The use of ESG metrics reflects the importance of our performance and progress against our long-term
ambitions in this area.
Operation
– Award levels and the framework for determining vesting are reviewed annually.
– Long-term incentive awards consist of awards of shares subject to performance conditions which are granted in
respect of any financial year.
– Awards will vest based on Group performance against the performance metrics set out below, measured over a
period of normally not less than three years. In exceptional circumstances, such as but not limited to where a
delay to the grant date is required, the Remuneration Committee may set a vesting period of less than three years,
although awards will continue to be subject to a performance period of at least three years.
– Awards may be subject to a mandatory two-year post-vesting holding period before the underlying shares can be sold.
– Dividend equivalents are paid in cash and/or shares by reference to the vesting period (and holding period, if
applicable) in respect of shares that vest.
Opportunity
– Maximum long-term incentive face value at award of 500% of base salary for the Chief Executive and 450% for
other Executive Directors in respect of any financial year.
– Threshold long-term incentive face value at award is 20% of maximum opportunity. Minimum vesting is 0% of
maximum opportunity. Awards vest on a straight-line basis between threshold and maximum.
– The Remuneration Committee retains the discretion to adjust the extent to which an award vests based on the
achievement of the relevant performance conditions and to reflect the Company’s and Executive Director’s
underlying performance and any other factors the Remuneration Committee considers appropriate. In addition,
the Remuneration Committee has the discretion to reduce long-term incentive grant levels for Executive Directors
who have neither met their shareholding guideline nor increased their shareholding by 100% of salary during the year.
Performance metrics
– Performance is measured against stretching targets set at the time of grant.
– Vesting is determined based on the following measures: adjusted free cash flow as our operational performance
measure, relative TSR against a peer group of companies as our external performance measure, and ESG as a
measure of our external impact and commitment to our purpose.
– Weightings will be determined each year and will normally constitute 60% on adjusted free cash flow, 30% on
relative total shareholder return, and 10% on ESG. The Remuneration Committee will determine the actual
weighting of an award prior to grant, taking into account all relevant information.
Remuneration Policy (continued)
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Notes to the Remuneration Policy table
Existing arrangements
We will honour existing awards, incentives, benefits and contractual arrangements made to individuals prior to their promotion to the Board
and/or prior to the approval and implementation of this Remuneration Policy. For the avoidance of doubt this includes payments in respect of
any award granted under any previous Remuneration Policy. This will last until the existing incentives vest (or lapse) or the benefits or
contractual arrangements no longer apply.
Long-term incentive (‘GLTI’)
When referring to our long-term incentive awards we use the financial year end in which the award was made. For example, the “2023 award”
was made in the financial year ending 31 March 2023. The awards are usually made in the first half of the financial year.
The extent to which awards vest depends on three performance conditions:
– underlying operational performance as measured by adjusted free cash flow;
– relative Total Shareholder Return (‘TSR’) against a peer group median; and
– performance against our Environmental, Social, and Governance (‘ESG’) targets.
Further details of these performance conditions are set out below. The Remuneration Committee reserves the right during the lifetime of the
Remuneration Policy to change the performance conditions applicable to GLTI awards to other financial, shareholder return and strategic
metrics, if the Remuneration Committee determines that to do so would be in the best interests of the Company. However, in such
circumstances, the majority of the GLTI awards would continue to remain subject to financial performance targets. The Remuneration
Committee would engage with major shareholders prior to changing the performance conditions applicable to GLTI awards in this way.
Adjusted free cash flow
The free cash flow performance is based on the cumulative adjusted free cash flow figure over the performance period. The detailed targets
and the definition of adjusted free cash flow are determined each year as appropriate. The target adjusted free cash flow level is set by
reference to our long-range plan and market expectations. The Remuneration Committee sets these targets to be sufficiently demanding and
with significant stretch.
The cumulative adjusted free cash flow vesting levels as a percentage of the award subject to this performance element are shown in the table
below (with linear interpolation between points):
Performance
Vesting percentage
(% of FCF element)
Below threshold
0%
Threshold
20%
Maximum
100%
Relative TSR
We have a limited number of appropriate peers and this makes the measurement of a relative ranking system volatile. As such, the
outperformance of the median of a peer group is felt to be the most appropriate TSR measure. The peer group and outperformance range for
the performance condition are reviewed each year and amended as appropriate.
The TSR vesting levels as a percentage of the award subject to this performance element are shown in the table below (with linear
interpolation between points):
Performance
Vesting percentage
(% of TSR element)
Below threshold
0%
Threshold (median)
20%
Maximum (outperformance of median as determined per award)
100%
In order to determine the percentages for the equivalent outperformance levels above median, the Remuneration Committee seeks
independent external advice.
ESG performance
Our ESG targets are set on an annual basis (in accordance with our approach for our other performance measures) and are aligned to our
externally communicated ambitions in this area. Where performance is below the agreed ambition, the Remuneration Committee will use its
discretion to assess vesting based on performance against the stated ambition and any other relevant information.
Remuneration policy for other employees
While our remuneration policy follows the same fundamental principles across the Group, packages offered to employees reflect differences
in market practice in the different countries, role and seniority.
For example, the remuneration package elements for our Executive Committee are essentially the same as for the Executive Directors with
some minor differences, for example smaller levels of share awards and local variances where appropriate. The remuneration for the next level
of management, our Senior Leadership Team, again follows the same principles with local and/or individual performance aspects in the annual
bonus targets and GLTI awards. They also receive lower levels of share awards which are partly delivered in conditional share awards without
performance conditions.
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Estimates of total future potential remuneration from 2024 pay packages
The tables below provide estimates of the potential future remuneration for Executive Directors based on the remuneration opportunity to be
granted in the 2024 financial year. Potential outcomes based on different performance scenarios are provided in accordance with the relevant
regulatory requirements.
The assumptions underlying each scenario are described below.
Fixed
Consists of base salary, benefits and pension.
Base salary is at 1 July 2023.
Benefits are valued using the figures in the total remuneration for the 2023 financial year table on page 94 (of the 2023 annual report).
Pensions are valued by applying cash allowance rate of 10% of base salary at 1 July 2023.
Base
(£’000)
Benefits
(£’000)
Pension
(£’000)
Total fixed
(£’000)
Group Chief Executive
and Chief Financial Officer
1,250
26
125
1,401
Mid-point
Based on what a Director would receive if performance was in line with the Company’s business plan.
The opportunity for the annual bonus (‘GSTIP’) is 100% of base salary under this scenario.
The opportunity for the long-term incentive (‘GLTI’) reflects assumed achievement mid-way between threshold and
maximum performance.
Maximum
The maximum award opportunity for the GSTIP is 200% of base salary.
The maximum GLTI opportunity reflects full vesting based on the maximum award levels set out in this Remuneration Policy
(i.e. 500% of base salary for the Chief Executive and 450% of base salary for the Chief Financial Officer).
Maximum
+50%
The same assumptions apply as for ‘Maximum’ but with a 50% uplift in the value of the GLTI award.
All scenarios
Long-term incentives consist of share awards only which are measured at face value, i.e. no assumption is made for dividend
equivalents which may be payable.
22%
22%
14%
14%
10%
10%
13,276
13,276
71%
71%
10,151
10,151
61%
61%
6,401
6,401
59%
59%
1,401
1,401
Mid-point
Maximum
Maximum
(assuming 50%
share price growth)
Fixed
Salary, Benefits, and Pension
Annual Bonus
Long-Term Incentive
19%
19%
25%
25%
19%
19%
Margherita Della Valle
Group Chief Executive and Chief Financial Officer
£’000
Recruitment remuneration
Our approach to recruitment remuneration is to pay no more than is necessary and appropriate to attract the right talent to the role.
The Remuneration Policy table (pages 88 and 89) sets out the various components which would be considered for inclusion in the remuneration
package for the appointment of an Executive Director. Any new Director’s remuneration package will take into account the elements and constraints of
those of the existing Directors performing similar roles and the individual circumstances of the new Director. This means a potential maximum bonus
opportunity of 200% of base salary and long-term incentive maximum face value of opportunity at award of 500% of base salary.
When considering the remuneration arrangements of individuals recruited from external roles to the Board, we will take into account the remuneration
package of that individual in their prior role. We only provide additional compensation to individuals for awards forgone. If necessary we will seek to
replicate, as far as practicable, the level and timing of such remuneration, taking into account also any remaining performance requirements applying to
it. This will be achieved by granting awards of cash or shares that vest over a timeframe similar to those forfeited and, if appropriate, based on performance
conditions. A commensurate reduction in quantum will be applied where it is determined that the new awards are either not subject to performance
conditions or subject to performance conditions that are not as stretching as those of the awards forfeited. Where it is not practicable to grant these
‘buy-out’ awards using the GLTI rules submitted to shareholders at the 2023 AGM, the Company may grant these awards using bespoke arrangements.
Service contracts of Executive Directors
Executive Directors’ contracts have rolling terms and can be terminated with no more than 12 months’ notice.
The key elements of the service contract for Executive Directors relate to remuneration, payments on loss of office (see next page), and restrictions
during active employment (and for 12 months thereafter). These restrictions include non-competition and non-solicitation of customers and employees.
Remuneration Policy (continued)
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Treatment of corporate events
All of the Company’s share plans contain provisions relating to a change of control of the Company. Outstanding awards and options would
normally vest and become exercisable on a change of control taking into account, in respect of GLTI awards, the extent to which, in the
Remuneration Committee’s opinion, any relevant performance conditions are satisfied, the Company’s and the Executive Director’s performance,
any other relevant factors and, unless the Remuneration Committee determines otherwise, the proportion of the vesting period that has elapsed.
In the event of a demerger, distribution (other than an ordinary dividend) or other transaction which would affect the current or future value of
any award, the Remuneration Committee may allow awards to vest on the same basis as for a change of control described above. Alternatively,
an adjustment may be made to the number of shares if considered appropriate.
Payments for departing Executive Directors
In the table below we summarise the key elements of our Remuneration Policy on payments for loss of office. We will always comply both with the relevant
plan rules and local employment legislation. The Remuneration Committee may make any statutory payment that is required in any relevant jurisdiction.
Provision
Policy
Notice period and
compensation for
loss of office in
service contracts
– 12 months’ notice from the Company to the Executive Director.
– Up to 12 months’ base salary and contractual benefits (in line with the notice period). Notice period payments will either
be made as normal (if the Executive Director continues to work during the notice period or is on gardening leave) or they
will be made as monthly payments in lieu of notice (subject to mitigation if alternative employment is obtained).
Treatment of
annual bonus
(‘GSTIP’) on
termination
under plan rules
– The annual bonus may be pro-rated for the period of service during the financial year and will reflect the extent to which
Company performance has been achieved. The annual bonus may be paid in such proportions of cash and shares, and
subject to such deferral arrangements, as the Remuneration Committee may determine.
– The Remuneration Committee has discretion to adjust the entitlement to an annual bonus to reflect the individual’s
performance and the circumstances of the termination.
Treatment of
unvested
long-term
incentive awards
(‘GLTI’) on
termination
under plan rules
– Normally, unvested GLTI awards will lapse when an Executive Director leaves the Group. However, an Executive Director’s
award will vest in accordance with the terms of the plan to the extent determined by the Remuneration Committee
taking into account applicable performance conditions, the underlying performance of the Company and of the
Executive Director and any other relevant factors, if the Executive Director dies in service or leaves because of their ill
health, injury, disability, redundancy or retirement, or the sale of their employing company or business out of the Group
or for any other reason determined by the Remuneration Committee, more than five months after the month in which
the award is granted. The Remuneration Committee has discretion to determine whether the award will vest at the
normal vesting date or earlier. The Remuneration Committee will determine the satisfaction of performance conditions
applicable to the award. Awards will, unless the Remuneration Committee determines otherwise, be pro-rated for the
proportion of the vesting period that had elapsed at the date the Executive Director leaves the Group.
– The Remuneration Committee has discretion to vary the level of vesting as deemed appropriate, and in particular to
determine that awards should not vest for reasons which may include, at their absolute discretion, departure in case
of poor performance, departure without the agreement of the Board, or detrimental competitive activity.
Pension and
benefits
– Generally pension and benefit provisions will continue to apply until the termination date.
– Where appropriate other benefits may be receivable, such as (but not limited to) payments in lieu of accrued holiday,
legal fees, tax advice costs in relation to the termination and outplacement support.
– Benefits of relatively small value may continue after termination where appropriate, such as (but not limited to) mobile phone provision.
In exceptional circumstances, an arrangement may be established specifically to facilitate the exit of a particular individual albeit that any such
arrangement would be made within the context of minimising the cost to the Group. We will only take such a course of action in exceptional
circumstances and where it is considered to be in the best interests of shareholders.
Chair and Non-Executive Directors’ remuneration
Our policy is for the Chair to review the remuneration of Non-Executive Directors annually following consultation with the Remuneration
Committee Chair. Fees for the Chair are set by the Remuneration Committee.
Element
Policy
Fees
– We aim to pay competitively for the role including consideration of the time commitment required. We benchmark the fees
against an appropriate external comparator group. We pay a fee to our Chair which includes fees for chair of any committees.
We pay a fee to each of our other Non-Executive Directors and they may receive an additional fee if they chair or are a member
of a committee and/or hold the position of Senior Independent Director (although the Remuneration Committee does not
currently intend to award additional fees for serving on a Board committee, other than for chairing that committee). Non-
Executive Directors’ fee levels are set within the maximum level as approved by shareholders as part of our Articles of
Association. We review the structure of fees from time to time and may, as appropriate, make changes to the manner in which
total fees are structured, including but not limited to any additional chair or membership fees.
Allowances
– Under a legacy arrangement, an allowance is payable each time certain non-Europe-based Non-Executive Directors are
required to travel to attend Board and committee meetings to reflect the additional time commitment involved.
Incentives
– Non-Executive Directors do not participate in any incentive plans.
Benefits
– Non-Executive Directors do not participate in any benefit plans. The Company does not provide any contribution to their
pension arrangements. The Chair is entitled to the use of a car and a driver whenever and wherever they are providing their services to
or representing the Company. We have been advised that for Non-Executive Directors, certain travel and accommodation expenses
in relation to attending Board meetings should be treated as a taxable benefit, therefore we also cover the tax liability for these expenses.
Non-Executive Director letters of appointment
Non-Executive Directors are engaged on letters of appointment that set out their duties and responsibilities. The appointment of Non-Executive
Directors may be terminated without compensation. Non-Executive Directors are generally not expected to serve for a period exceeding nine
years. For further information refer to the Nominations and Governance Committee section of the Annual Report.
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Annual Report on Remuneration
Remuneration Committee
In this section we give details of the composition of the Remuneration Committee (the ‘Committee’) and activities undertaken during the 2024
financial year. The Committee’s function is to exercise independent judgement and consists only of the following independent Non-Executive
Directors:
Chair: Amparo Moraleda (appointed 25 July 2023), Valerie Gooding (until 25 July 2023)
Committee members: Delphine Ernotte Cunci, Michel Demaré and Dame Clara Furse (until 25 July 2023)
The Committee regularly consults with Margherita Della Valle, Group Chief Executive, and Leanne Wood, the Chief Human Resources Officer, on
various matters relating to the appropriateness of awards for Executive Directors and senior executives, though they are not present when their
own compensation is discussed. In addition, James Ludlow, the Group Reward and Policy Director, provides a perspective on information provided
to the Committee, and requests information and analysis from external advisers as required. Maaike de Bie, the Group General Counsel and
Company Secretary, advises the Committee on corporate governance guidelines and is Secretary to the Committee.
External advisers
The Committee seeks and considers advice from independent remuneration advisers where appropriate. The appointed advisers, WTW, were
appointed by the Committee in 2007. The Chair of the Committee has direct access to these advisers as and when required, and the Committee
determines the protocols by which these advisers interact with management in support of the Committee. The advice and recommendations of
the external advisers are used as a guide, but do not serve as a substitute for thorough consideration of the issues by each Committee member.
Advisers attend Committee meetings occasionally, as and when required by the Committee.
WTW is a member of the Remuneration Consultants’ Group and, as such, voluntarily operates under the Remuneration Consultants’ Group Code
of Conduct in relation to executive remuneration consulting in the UK. This is based upon principles of transparency, integrity, objectivity,
competence, due care and confidentiality by executive remuneration consultants. WTW has confirmed that it adhered to that Code of Conduct
throughout the year for all remuneration services provided to Vodafone and therefore the Committee is satisfied that it is independent and
objective. The Remuneration Consultants’ Group Code of Conduct is available at remunerationconsultantsgroup.com.
Adviser
Appointed by
Services provided to the Committee
Fees for services provided
to the Committee
£’0001
Other services provided to the Company
WTW
Remuneration
Committee
in 2007
Advice on market practice; governance;
provision of market data on executive
reward; reward consultancy; and
performance analysis.
£140
Reward and benefits consultancy;
provision of benchmark data;
outsourced pension administration; and
insurance consultancy services.
Note:
1. Fees are determined on a time spent basis.
2023 Annual General Meeting – Remuneration Policy voting results
At the 2023 Annual General Meeting there was a binding vote on our Remuneration Policy. Details of the voting outcomes are provided in the
table below.
Votes for
%
Votes against
%
Total votes
Withheld
Remuneration Policy
16,676,713,036
95.18
845,122,413
4.82
17,521,835,449
435,210,254
2023 Annual General Meeting – Remuneration Report voting results
At the 2023 Annual General Meeting there was an advisory vote on our Remuneration Report. Details of the voting outcomes are provided in the
table below.
Votes for
%
Votes against
%
Total votes
Withheld
Remuneration Report
16,260,672,370
90.75
1,658,116,047
9.25
17,918,788,417
49,211,242
Meetings
The Remuneration Committee normally has five scheduled meetings per year, held either in person or via conference call. Details of the principal
agenda items for these meetings for the year under review are set out below. In addition to these scheduled meetings, ad hoc meetings or
conference calls can also take place when required. Meeting attendance can be found on page 70.
Meeting
Agenda items
May 2023
– 2023 annual bonus achievement and 2024 targets/ranges
– 2021 long-term incentive award vesting and 2024 targets/ranges
– External market update
– 2023 Directors’ Remuneration Report
– Shareholder engagement
July 2023
– 2023 AGM update
– Share plan grant approval
November 2023
– External market update
– Share plan update
January 2024
– 2025 short-term incentive structure
– Share plan update
– Gender Pay Gap reporting
March 2024
– Risk assessment of incentive plans
– Remuneration arrangements across Vodafone
– 2024 Directors’ Remuneration Report
– Chair and Non-Executive Director fee levels
– 2025 reward packages for the Executive Committee
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2024 remuneration
In this section we summarise the pay packages awarded to our Executive Directors for performance in the 2024 financial year versus 2023.
Specifically, we have provided a table that shows all remuneration that was earned by each individual during the year and computed a single total
remuneration figure for the year. The value of the annual bonus (‘GSTIP’) reflects what was earned in respect of the year but will be paid out in the
following year. Similarly the value of the long-term incentive (‘GLTI’) reflects the share award which will vest in August 2024 as a result of the
performance through the three-year period ended 31 March 2024.
Consideration of the use of discretion
The Remuneration Committee reviews all incentive awards prior to payment and uses judgement to ensure that the final assessments of
performance are fair and appropriate. If circumstances warrant it, the Committee may adjust the final payment or vesting.
The Committee reviewed incentive outcomes at the May 2024 meeting and considered the appropriateness of outcomes in light of wider
financial and business performance and the wider employee experience across the relevant measurement periods for both the short-term and
long-term incentive plans. The Committee agreed the outcomes were appropriate and that no adjustments were required to either the short-term
or long-term incentive outcomes this year.
Board changes
Margherita Della Valle was appointed Group Chief Executive on 27 April 2023, having previously held the role on an interim basis effective 1
January 2023. Prior to this Margherita had held the role of Chief Financial Officer. Margherita’s 2024 single figure therefore predominantly reflects
remuneration received in respect of her time as Group Chief Executive whereas her 2023 single figure includes remuneration arrangements in
relation to her time as Chief Financial Officer.
Luka Mucic was appointed Group Chief Financial Officer on 1 September 2023 and this period of service is reflected in his 2024 single figure.
Total remuneration for the 2024 financial year (audited)
Margherita Della Valle
Luka Mucic
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Salary/fees
1,238
806
443
–
Taxable benefits1
40
26
115
–
Annual bonus: GSTIP (see below for further detail)
1,780
1,206
631
–
Total long-term incentive:
1,198
1,288
–
–
GLTI awards2,3
894
977
–
–
GLTI dividends4
304
311
–
–
Pension/cash in lieu of pension
124
81
44
–
Total
4,380
3,407
1,233
–
Total Fixed Remuneration
1,402
913
602
–
Total Variable Remuneration
2,978
2,494
631
–
Notes:
1. Taxable benefits include amounts in respect of:
– Private healthcare (2024: Margherita Della Valle £2,801; 2023: Margherita Della Valle £2,575);
– Cash car allowance £19,200 p.a.;
– Travel (2024: Margherita Della Valle £17,590, Luka Mucic £1,663; 2023: Margherita Della Valle £4,235); and
– Relocation (2024: Luka Mucic £102,215).
2. The share prices used for the 2023 and 2024 values, as set out in note 3 below, are lower than the grant prices for the respective awards. As such, no amount of the value shown in the 2023 or 2024
column is attributable to share price appreciation during the performance or vesting periods.
3. The value shown in the 2023 column is the award which vested on 3 August 2023 and is valued using the execution share price on 3 August 2023 of 72.84 pence. The value shown in the 2024
column is the award which vests on 3 August 2024 and is valued using an average closing share price over the last quarter of the 2024 financial year of 67.84 pence.
4. Under the GLTI, executives receive a cash award equivalent in value to the dividends that would have been paid during the vesting period on any shares that vest. The dividend value shown in 2024
relates to awards vesting on 3 August 2024.
2024 annual bonus (‘GSTIP’) payout (audited)
In the table below we disclose our achievement against each of the performance measures and targets in our annual bonus (‘GSTIP’) and the
resulting total annual bonus payout level for the year ended 31 March 2024 of 71.2% of maximum. This is applied to the maximum bonus level of
200% of base salary for each Executive Director. Commentary on our performance against each measure is provided on the next page.
Performance measure
Payout at
maximum
performance
(% of salary)
Actual payout
(% of salary)
Actual payout
(% of overall
bonus
maximum)
Threshold
performance
level
€bn
Target
performance
level
€bn
Maximum
performance
level
€bn
Actual
performance
level1
€bn
Service revenue
40.0%
37.3%
18.7%
36.3
37.4
38.5
38.4
Adjusted EBIT
40.0%
25.9%
12.9%
3.8
4.5
5.3
4.7
Adjusted free cash flow
40.0%
34.4%
17.2%
2.7
3.2
3.7
3.6
Revenue market share
20.0%
10.5%
5.2%
See overleaf for further details
Net Promoter Score
40.0%
22.4%
11.2%
Churn
20.0%
11.9%
6.0%
Total annual bonus payout level
200.0%
142.4%
71.2%
Note:
1. These figures are adjusted for the impact of M&A, foreign exchange movements and any changes in accounting treatment.
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Financial metrics
As set out in the table above, EBIT finished above the mid-point of the respective target ranges whilst service revenue and free cash flow finished
between the mid and maximum point of the respective target ranges.
Customers metrics
An assessment of performance under the customers measures was conducted on a market-by-market basis. Each market was assessed against a
number of different metrics against the following measures:
– Net Promoter Score (‘NPS’) for both Consumer and Vodafone Business – defined as the extent to which our customers would recommend us.
– Churn – defined as total gross customer disconnections in the period divided by the average total customers in the period.
– Revenue market share (‘RMS’) – based on our total service revenue and that of our competitors in the markets we operate in.
All measures utilise data from our local markets which is collected and validated for quality and consistency by independent third-party agencies
where possible. Further details on our performance against each key metric is set out below.
During the year we recorded strong Consumer NPS market leadership or co-leadership positions in UK, Italy, Ireland, Portugal and Albania in
Europe, and South Africa, Egypt, Tanzania, Lesotho and DRC in Africa. Our benchmark Consumer NPS monitoring was supported with additional
insight gained from launching lifecycle NPS monitoring across a number of our markets. This methodology assessed our progress against our
strategic focus of reducing the number of deep detractors by asking whether customers would recommend Vodafone to friends, family or
colleagues. All but one of our markets saw a reduction in deep detractors with notable progress made in Portugal, Turkey and the UK. Overall, we
reduced deep detractors by 14% in Europe and 16% at a Group level - a reduction of over four million unhappy customers from the start of the
year. In respect of Business NPS, we ended the performance period holding the lead position in five markets and made significant improvements
in our gap to market leaders in Germany and Turkey.
We have recorded broadly stable overall churn levels in our European markets. In respect of mobile, we have maintained low churn levels in
Vodacom Group and in a number of our European markets. In both Germany and the UK we have seen year-on-year improvements and in the UK
this has been principally driven by customer experience initiatives. In respect of our fixed services, we have recorded steady year-on-year results in
Europe and improvements in Turkey and our African markets despite economic and geopolitical challenges.
We have reported steady results in our overall RMS position this year with good performance reported in a majority of our markets, supported by
an updated pricing strategy. We have seen year-on-year improvements in our fixed line services in markets including, but not limited to, the UK,
Egypt, Greece and Czech Republic. Elsewhere in our mobile services, we have reported improvements in South Africa, Egypt, Portugal and
Romania.
It is within this context that performance against our customers measures during the year was judged to be above the mid point of the respective
ranges for NPS and churn and at the mid point of the target range for RMS.
Overall outcome
2024 annual bonus (‘GSTIP’) amounts
Base salary
£’000
Maximum bonus
% of base salary
2024 payout
% of maximum
Actual payment
£’000
Margherita Della Valle
1,250
200%
71.2%
1,7801
Luka Mucic
760
200%
71.2%
6311,2
Notes:
1. 25% of both executives’ post-tax bonus will be deferred into shares for two years.
2. Reflects bonus paid in respect of period served.
Long-term incentive (‘GLTI’) award vesting in August 2024 (audited)
Vesting outcome
The 2022 long-term incentive (‘GLTI’) awards which were made to executives in August 2021 will vest at 48.9% of maximum in August 2024.
The performance conditions for the three-year period ending in the 2024 financial year are as follows:
Adjusted FCF performance – 60% of total award (€bn)
TSR outperformance – 30% of total award
TSR peer group
Below threshold
<15.00
Below threshold
Below median
BT Group
Orange
Threshold
15.00
Threshold
Median
Deutsche Telekom
Royal KPN
Maximum
17.00
Maximum
8.50% p.a.
Liberty Global
Telecom Italia
MTN
Telefónica
Telefónica Deutschland
ESG performance – 10% of total award
Purpose pillar
ESG metric for 2022 GLTI
Overall ambition at time of 2022 GLTI
Baseline position for 2022 GLTI
Ambition for 2022 GLTI (10% of total award)
Planet
Greenhouse gas reduction
50% reduction from FY17
baseline by 2025
37% reduction from FY17
baseline at 31 March 2021
60% reduction from FY17
baseline by 31 March 2024
Inclusion for All
Women in management
40% representation of
women in management by
2030
32% representation of
women in management at
31 March 2021
35% representation of
women in management by
31 March 2024
Digital Society /
Inclusion for All
M-Pesa connections
Connect >50m people and
their families to mobile
money by 2025
48.3m connections at
31 March 2021
68.2m connections by
31 March 2024
Annual Report on Remuneration (continued)
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Other information
100
119
117
114
98
128
102
77
119
116
71
141
67
117
148
03/21
09/23
03/23
09/22
03/22
09/21
03/24
Vodafone Group
Median of peer group
Outperformance of
median 8.5% p.a.
40
60
80
100
120
140
160
115
108
107
102
2022 GLTI award: TSR performance
Growth in the value of a hypothetical US$100 holding
over the performance period, six-month averaging
The vesting outcome when applied to the number of shares granted is set out in the table below.
2022 GLTI share awards subject to performance conditions
vesting in August 2024
Maximum
number
of shares
Adjusted free cash
flow performance
payout
% of maximum
Relative TSR
performance payout
% of maximum
ESG
performance payout
% of maximum
Weighted
performance payout
% of maximum
Number of
shares vesting
Value of
shares vesting
(’000)
Margherita Della Valle
2,696,917
65.3%
0%
96.9%
48.9%
1,317,713
£893,936
Specified procedures are performed by our internal audit team over the adjusted free cash flow to assist with the Committee’s assessment of
performance. The performance assessment in respect of the TSR measure is undertaken by WTW. ESG performance is presented to the ESG
Committee and the Audit and Risk Committee prior to the achievement level being reviewed by the Remuneration Committee. Details of how the
plan works can be found in the Remuneration Policy.
Long-term incentive (‘GLTI’) awarded during the year (audited)
The independent performance conditions for the 2024 long-term incentive awards made in July 2023, and subject to a three-year performance
period ending 31 March 2026, are adjusted free cash flow (60% of total award), relative TSR (30% of total award) and ESG (10% of total award)
performance as follows:
Adjusted FCF performance
(60% of total award)
Adjusted FCF performance
(€bn)
Vesting percentage
(% of FCF element)
Below threshold
<9.0
0%
Threshold
9.0
20%
Maximum
11.0
100%
TSR performance
(30% of total award)
TSR outperformance
Vesting percentage
(% of TSR element)
Below threshold
Below median
0%
Threshold
Median
20%
Maximum
7.00% p.a.
100%
TSR peer group
BT Group
Deutsche Telekom
Liberty Global
MTN
Orange
Royal KPN
Telecom Italia
Telefónica
Telefónica Deutschland
The adjusted free cash flow for the three-year period ended on 31
March 2024 was €16.1 billion and equates to vesting under the FCF
element of 65.3% of maximum.
The chart to the right shows that our TSR performance over the
three-year period ended on 31 March 2024 was below the median of
the peer group resulting in no vesting under this measure.
ESG performance across our three metrics was as follows:
– GHG reduction: exceeded GHG reduction of 60% from the FY17
baseline as at 31 March 2024.
– Women in management: exceeded 35% representation of women
in management at 31 March 2024.
– M-Pesa: slightly below ambition of 68.2m connections at 31 March
2024.
The Committee reviewed the above performance and determined
vesting under the ESG element of 96.9% of maximum. This reflected
full achievement under the GHG reduction and the Women in
management metrics where ambitions were exceeded, and partial
vesting under the M-Pesa metric where strong progress against the
stretching ambition was made.
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42%
increase
Margherita Della Valle (as at 31 March 2024)
Actual holding
(number of shares)
Goal deadline:
April 2028
Holding scenario
(% of salary)
31/03
2024
31/03
2023
Goal
Actual
31/03
2024
Illustrative
20% SP
increase
Illustrative
20% SP
decrease
Actual
31/03
2023
3.2m
2.2m
500%
172%
292%
138%
138%
207%
207%
Luka Mucic (as at 31 March 2024)
Actual holding
(number of shares)
Goal deadline:
September 2028
Holding scenario
(% of salary)
31/03
2024
31/03
2023
Goal
Actual
31/03
2024
Illustrative
20% SP
increase
Illustrative
20% SP
decrease
3.6m
1.8m
400%
322%
258%
258%
387%
387%
ESG performance – 10% of total award
Purpose pillar
ESG metric for 2024 GLTI
Overall ambition
Baseline position for 2024 GLTI
Ambition for 2024 GLTI
Planet
Net zero
Net zero under Scope 1 & 2
by 20301
52% reduction in Scope 1 &
2 emissions versus a FY20
baseline at 31 March 2023
84% reduction in Scope 1 & 2
emissions versus a FY20
baseline by 31 March 2026
Inclusion for All
Female representation in
management
40% representation of
women in management by
2030
34% representation of
women in management at
31 March 2023
36% representation of
women in management by
31 March 2026
Digital Society/
Inclusion for All
Financial inclusion
customers
>75m financial inclusion
customers by 2026
60.7m financial inclusion
customers at 31 March 2023
70.0m financial inclusion
customers by 31 March 2026
Note:
1. This carbon reduction ambition has been approved by the Science Based Targets initiative.
The table below sets out the conditional awards of shares made to Margherita Della Valle in July 2023 and Luka Mucic in November 2023. The
number of shares awarded for the maximum vesting level granted were based on the closing share price prior to the day of grant. At the time of
the awards vesting, the Remuneration Committee will assess if any adjustments are required based on any windfall gains believed to have occurred.
2024 GLTI performance share awards made in 20231
Maximum
vesting level
(number of shares)
Maximum
vesting level
(face value2)
Proportion of maximum
award vesting at minimum
performance
Performance
period end
Margherita Della Valle
8,061,395
£6,250,000
1/5th
31 Mar 2026
Luka Mucic
4,670,854
£3,400,000
1/5th
31 Mar 2026
Notes:
1. GLTI awards were granted as conditional share awards over shares with a value equal to the percentages of salary referred to on page 99. Dividend equivalents on the shares that vest are paid in cash
after the vesting date.
2. Face value calculated based on the closing share price on 26 July 2023 (day immediately preceding the date of the July grant) of 77.5 pence in respect of the award made to Margherita Della Valle
and the closing share price on 16 November 2023 (day immediately preceding the date of the November grant) of 73.2 pence in respect of the award made to Luka Mucic.
Outstanding awards
The structure for awards made in July 2022 (vesting July 2025) and July 2023 (vesting July 2026) is set out on the previous page. Further details
of the structure of these awards, and relevant targets, can be found in the Annual Report on Remuneration of the relevant year.
All-employee share plans
During the year the Executive Directors were eligible to participate in the Vodafone Group Sharesave Plan which is a HM Revenue & Customs
(‘HMRC’) approved scheme. Options under the plan are granted at up to a 20% discount to market value. No Executive Directors currently hold
options under the plan.
Pensions (audited)
During the 2024 financial year, Margherita Della Valle accrued benefits under the defined contribution pension plan of £10,000, with the
remainder of her 10% of base salary pension benefit for the year delivered as a cash allowance. Luka Mucic received a pro-rated cash allowance of
10% of base salary.
Margherita Della Valle has not participated in a Vodafone sponsored defined benefit scheme during her employment. The Executive Directors are
provided benefits in the event of death in service. In the event of ill health, an entitlement to benefit of two-thirds of base salary, up to a maximum
benefit determined by the insurer, may be provided up until state pension age. In respect of the Executive Committee members, during the year
the Group has made aggregate contributions of £171,177 (2023: £147,507) into defined contribution pension schemes during the year.
Alignment to shareholder interests (audited)
Share ownership levels and requirements for individuals who held the position of Executive Director are set out in the table below.
As shown in the chart below, both executives increased their shareholding level during the year. The share price used for measurement purposes
decreased from 93.85 pence for the 31 March 2023 measurement to 67.84 pence for the 31 March 2024 measurement.
At 31 March 2024
Requirement
as a % of salary
Current %
of salary held
% of requirement
achieved
Number of
shares owned
Value of
shareholding
Date for
requirement to be
achieved
Margherita Della Valle
500%
172%
34%
3,172,674
£2.2m
Apr 2028
Luka Mucic
400%
322%
81%
3,610,000
£2.4m
Sep 2028
Annual Report on Remuneration (continued)
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The shareholding requirements include a post-employment condition whereby the Executive Directors will need to continue to hold shares
equivalent to the value of their requirement at the date of departure (or actual holding on departure if the requirement has not been reached
during employment) for a further two years post-employment. The Committee has a number of processes in place to ensure this condition is met,
including executives agreeing to these terms prior to receiving an award, executives holding the majority of their shares (and at least up to the
value of their requirement) in a Company-accessible account, and the Committee having the ability to lapse any unvested GLTI awards if the
condition is not met.
Collectively the Executive Committee, including the Executive Directors, owned 28,937,317 Vodafone shares at 31 March 2024, with a value of
over £19.6 million. None of the Executive Committee members’ shareholdings amounts to more than 1% of the issued shares in that class of
share, excluding treasury shares.
Directors’ interests in the shares of the Company (audited)
A summary of interests in shares and scheme interests of the Directors who served during the year is given below. More details of the outstanding
shares subject to award are set out in the table below. Neither Executive Director held any options at 31 March 2024.
At 31 March 2024
Total number
of interests in shares
(at maximum)1
Unvested with
performance conditions
(at target)
Unvested with
performance conditions
(at maximum)
Executive Directors
Margherita Della Valle
18,350,321
9,106,588
15,177,647
Luka Mucic
8,280,854
2,802,512
4,670,854
Total
26,631,175
11,909,100
19,848,501
Note:
This includes both owned shares and the maximum number of unvested share awards.
The total number of interests in shares includes interests of connected persons, unvested share awards and share options.
At 31 March 2024
Total number of interests in shares
Non-Executive Directors
Stephen A. Carter CBE
107,598
Delphine Ernotte Cunci
30,000
Sir Crispin Davis (position at retirement)
34,500
Michel Demaré
100,000
Hatem Dowidar (appointed 19 February 2024)
–
Dame Clara Furse (position at retirement)
150,000
Valerie Gooding (position at retirement)
28,970
Deborah Kerr
(ADRs) 12,0001
Amparo Moraleda
30,000
David Nish
107,018
Christine Ramon
–
Simon Segars
40,000
Jean-François van Boxmeer
1,208,998
Note:
1. One ADR is equivalent to 10 ordinary shares.
Other than those individuals included in the tables above who were Board members at 31 March 2024, members of the Group’s Executive
Committee at 31 March 2024 had an aggregate beneficial interest in 22,154,643 ordinary shares of the Company. At 14 May 2024, the Directors
had an aggregate beneficial interest in 8,418,288 ordinary shares of the Company and the Executive Committee members had an aggregate
beneficial interest in 21,503,820 ordinary shares of the Company. None of the Directors or the Executive Committee members had an individual
beneficial interest amounting to greater than 1% of the Company’s ordinary shares.
Performance share awards
The maximum numbers of shares subject to outstanding awards that have been granted to Directors under the long-term incentive (‘GLTI’) plan
are currently as follows:
GLTI performance share awards
2022 award
Awarded: August 2021
Performance period ending: March 2024
Vesting date: August 2024
Share price at grant: 116.8 pence
2023 award
Awarded: July 2022/February 2023
Performance period ending: March 2025
Vesting date: July 2025
Share price at grant: 122.4 pence
2024 award
Awarded: July 2023/November 2023
Performance period ending: March 2026
Vesting date: July 2026
Share price at grant: 77.5 pence
Margherita Della Valle
2,696,917
4,419,335
8,061,395
Luka Mucic
–
–
4,670,854
Note:
1. The Committee will review the performance outcome of all awards to assess whether any windfall gains are present at the point of vest.
Details of the performance conditions for the awards can be found on pages 108 to 110 or in the Remuneration Report from the relevant year.
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Share options
As at 31 March 2024 and 14 May 2024 no Directors held any share options.
At 14 May 2024 members of the Group’s Executive Committee held options for 56,692 ordinary shares at prices ranging from 58.4 pence to 103.0
pence per ordinary share, with a weighted average exercise price of 66.7 pence per ordinary share exercisable at dates ranging from 1 September
2024 to 1 September 2026.
Margherita Della Valle, Luka Mucic, Aldo Bisio, Ahmed Essam, Shameel Joosub, Joakim Reiter, Alberto Ripepi and Serpil Timuray held no options at
14 May 2024.
Loss of office payments (audited)
Other than amounts already disclosed in prior year reports, no loss of office payments were made during the year.
Payments to past Directors (audited)
During the 2024 financial year Lord MacLaurin received benefit payments in respect of security costs as per his contractual arrangements. These
costs exceeded our de minimis threshold of £5,000 p.a. and, including the tax paid, were £47,842 (2023: £24,657).
Fees retained for external non-executive directorships
Executive Directors may hold positions in other companies as non-executive directors and retain the fees paid to them in respect of these services.
During the year ended 31 March 2024, Margherita Della Valle served as a non-executive director on the board of Reckitt Benckiser Group plc
where she retained fees of £123,500 (2023: £118,000). Luka Mucic served as a non-executive director on the board of Heidelberg Materials AG
where he retained fees of €204,680.
2024 remuneration for the Chair and Non-Executive Directors (audited)
Salary/fees
Benefits1
Total
2024
£’000
2023
£’000
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Chair
Jean-François van Boxmeer
650
650
39
29
689
679
Senior Independent Director
David Nish
157
140
20
19
177
159
Non-Executive Directors
Stephen A. Carter CBE
115
79
3
2
118
81
Delphine Ernotte Cunci
115
79
5
5
120
84
Michel Demaré
115
115
10
11
125
126
Hatem Dowidar (appointed 19 February 2024)
–2
–
0
–
0
–
Deborah Kerr
115
115
17
14
132
129
Amparo Moraleda
157
140
11
10
168
150
Christine Ramon
115
44
15
1
130
45
Simon Segars
137
79
16
12
153
91
Former Non-Executive Directors
Sir Crispin Davis (stepped down 25 July 2023)
36
115
8
12
44
127
Dame Clara Furse (stepped down 25 July 2023)
36
115
5
9
41
124
Valerie Gooding (stepped down 25 July 2023)
52
165
7
10
59
175
Total
1,800
1,836
156
134
1,956
1,970
Notes:
1. This includes certain travel and accommodation expenses in relation to attending Board meetings which are treated as a taxable benefit. Values include these travel expenses and the corresponding
tax contribution.
2. As part of the strategic relationship agreement with e&, Hatem Dowidar, the Group Chief Executive Officer of e&, was appointed as a Non-Executive Director effective 19 February 2024. As per the
terms of the agreement, Hatem does not receive a fee for this role.
Pay in the wider context
Remuneration arrangements
As part of its review of executive remuneration arrangements, the Committee takes account of the pay policies in place across the wider business.
This includes considering the structure of remuneration offerings at each level of the business to ensure there is a strong rationale for how
packages evolve across the different levels of the organisation.
During the year the Committee reviewed the remuneration structure across the business, which included how our arrangements aligned with our
strategy, supported our purpose, and celebrated the Spirit of Vodafone. The update also set out the results of the latest annual fair pay review,
including where the key focus areas were and what actions had been agreed locally to implement any required adjustments.
Details of our remuneration offerings at each level of the business are provided on the following page.
Annual Report on Remuneration (continued)
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Executive Directors
Executive Committee
Senior Leadership Team
Wider workforce
Base salary
An annual benchmarking review is run across all levels of the organisation. At each level the review ensures appropriate job matches and
comparator groups are used, with external market data used to help inform line manager decisions on salary increases.
Our annual fair pay review (see below for further details) provides a robust process for ensuring new pay range
positionings are fair across our organisation.
Pension
Pension provision across all levels is driven by local market practice. As per our fair pay principles (see below), our global
standard ensures all of our people have access to appropriate state- or company-provided pension provision.
Benefits
Benefit provision across all levels is driven by local market practice. As per our fair pay principles, our global standard is to
offer all our people life insurance, parental leave and access to either state- or company-provided healthcare provision.
Spot cash
recognition
Not applicable.
Certain employees are eligible to receive
in-the-moment cash recognition for
great performance throughout the year.
Short-term
incentive
Eligible to participate (see page 99) with
outcomes based on business
performance.
Eligible to participate with
outcomes based on business and
individual performance.
Employees are eligible to participate in
either the short-term incentive (with
business and personal performance
elements) or a commission scheme.
The short-term Incentive performance measures are consistent across all levels of participants.
Long-term
incentive
Eligible to participate (see page 99). This
is 100% based on performance with a
three-year performance period and
addition two-year holding period.
Eligible to participate in the
long-term incentive, constituting
part performance and part
retention.
Subject to position, managers are eligible to
participate in a long-term incentive award of
restricted stock.
Share ownership
(% of salary)
CEO: 500%
Other: 400%
300%
Fixed number of shares set upon
appointment.
Not applicable.
Recognising performance and potential
To ensure we recognise and differentiate the reward of our employees, the total value of an employee’s short-term and, if relevant, long-term
incentive is driven by their impact and talent rating. To be eligible for a short-term incentive award, employees must meet minimum performance
standards, which include completion of our mandatory compliance training.
Fair pay at Vodafone
In addition to being a core principle of the Committee, there is a clear culture in our business of ensuring we offer competitive and fair pay to all
our people. Our approach across our business is guided by the six principles set out below. Our commitment to these principles is reflected in how
the UK-based Living Wage Foundation has certified us as an Accredited Living Wage employer.
1. Market competitive
2. Free from
discrimination
3. Ensure a good
standard of living
The pay of our people is reflective of their skills,
role and function and the external market.
We annually review the pay of each person and
actively manage any who fall below the market
competitive range.
Our pay should not be affected by gender, age,
disability, gender identity and expression, sexual
orientation, race, ethnicity, cultural heritage or belief.
We annually compare the average position of our
men and women against their market benchmark,
grade and function to identify and understand any
differences and take action if necessary.
We work with an independent organisation,
WageIndicator Foundation, to assess how our pay
compares to the ‘living wage’ in each of our
markets because we are committed to providing a
good standard of living for our people and their
families.
4. Share in our successes
5. Provide benefits for all
6. Open and transparent
All our people should have the opportunity to
share in our success by being eligible to receive
some form of performance-related pay, e.g. a
bonus, shares or sales incentive.
Our global standard is to offer all our people life
insurance, parental leave and access to either
Company or state provided healthcare and pension
provision.
We ensure that our people understand their pay.
We do this through a series of user-friendly guides,
webpages and an annual reward statement, which
help explain our people’s pay and outline the
value of their core reward package.
Cost of living actions
Rising inflation levels and the subsequent cost of living crisis continue to affect a number of employees in our markets. As a result, we continue to
provide targeted measures which include the delivery of additional or accelerated salary reviews and the provision of extra cash allowances
outside the annual reward review cycle.
Given the rapid inflationary change affecting those in Egypt, a supplementary Cost of Living Allowance (‘COLA’) was introduced, prior to two
off-cycle increases implemented during the year. In Turkey, where they are experiencing hyper-inflation, we took a similar approach by
accelerating our salary reviews and providing two additional off-cycle increases.
Click to read more about fair pay at Vodafone:
vodafone.com/fair-pay
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Annual Report on Remuneration (continued)
In our European markets, we delivered a one-off payment to non-tariff Germany employees below senior leadership level and in Ireland we
delivered a salary increase to front-line employees. For all our markets we carefully consider wider market conditions when setting salary budgets
for the 2024 annual reward review.
Risk management
The Committee undertakes an annual review of the potential risks within our incentive plans and what steps have been taken to mitigate these.
The review looks at both the structure of our incentives and the performance conditions used. Given our current structure and performance
metrics, the 2024 review focused on risk areas such as capital expenditure and alignment between management and stakeholders.
Stakeholder engagement
The Committee considers all stakeholder groups when setting executive pay including:
Employees
The Committee is fully briefed on pay arrangements across the business to ensure any decisions on executive pay are made
within our wider business context and take into account wider employee pay conditions. We engage with our employees
through a variety of means including employee forums, interactive webinars (including with our executives), global Spirit
Beat surveys and digital platforms, all of which give our people the chance to voice their opinion on any area of interest,
including all-employee and executive pay.
Customers
The importance of customers to our strategy is reflected in how our annual bonus plan includes the customer-focused
measures of Revenue Market Share, NPS, and Churn.
Shareholders
The Committee values the active participation of our shareholders during our consultations and fully considers all feedback
as part of the review process.
Government
The Committee actively engages with external professional bodies and government departments when they issue
consultations on proposed changes to legislation or reporting guidelines.
Wider society
The Committee is fully aware that society remains concerned about the risk of excessive executive pay practices in the
wider market. The Committee believes that transparent reporting and active engagement in explaining both the operation
of, and rationale for, executive pay decisions is key for businesses to retain trust in this area.
UK gender pay gap reporting
Each year we publish our UK gender pay gap in line with the statutory UK methodology. The nature of the statutory calculation means the gap
will fluctuate year on year, influenced by changes in our business structure, Company performance and the percentage of men and women at all
levels and positions. The existence of a UK gender pay gap in our business is primarily a consequence of more men than women holding senior or
specialist, and therefore higher-paid, roles.
With our commitment to embed an inclusive culture, we continue our work to reduce the gap and have made good progress since the publication
of our first report in 2017. Our global programmes aim to support women across different roles, areas, and geographies of our business and will,
over time, reduce our specific UK gender pay gap, which this year was calculated as 9.0% – a slight decrease from our 2022 figure of 10.4%.
We are proud of the policies that we have put in place to support our employees and we remain committed to addressing female representation at
senior levels and the gender pay gap.
Click to learn more about our initiatives, case studies, and key statistics on our dedicated UK gender pay gap webpage:
vodafone.com/uk-gender-pay-gap
Relative spend on pay
The chart below shows both the dividends distributed in the year and the total cost of remuneration in the Group.
5,842
5,842
2,502
2,502
2,433
2,433
6,246
6,246
Distributed by way
of dividends
Overall expenditure on
remuneration for all employees
2023
2024
2023
2024
€m
Read more details on dividends and expenditure on remuneration for all employees,
on pages 168 and 203 respectively
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CEO pay ratio
The following table sets out our CEO pay ratio figures:
Year
CEO single figure (£’000)
Method
25th percentile pay ratio
Median pay ratio
75th percentile pay ratio
2024
4,380
Option B
106:1
69:1
50:1
20231
4,394
Option B
127:1
62:1
71:1
2022
4,173
Option B
113:1
73:1
48:1
2021
3,551
Option B
106:1
87:1
42:1
2020
3,529
Option B
113.1
69.1
45.1
20192
4,359
Option B
154:1
107:1
56:1
Notes:
1. The CEO single figure used in the calculation of the 2023 ratios reflects a blended figure for Nick Read and Margherita Della Valle, recognising the change in incumbency for the role during this year.
2. The CEO single figure used in the calculation of the 2019 ratios reflects a blended figure for Vittorio Colao and Nick Read, recognising the change in incumbency for the role during this year.
The pay ratio figures in the above table are calculated using the following total pay and benefits information:
Year
Supporting information
25th percentile pay ratio (£’000)
Median pay ratio (£’000)
75th percentile pay ratio (£’000)
2024
Salary
35.9
54.6
72.8
Total pay and benefits
41.3
63.7
88.5
2023
Salary
26.5
56.1
75.6
Total pay and benefits
34.6
70.5
92.8
2022
Salary
31.7
47.1
71.5
Total pay and benefits
36.9
57.5
87.2
2021
Salary
30.0
37.1
71.2
Total pay and benefits
33.5
41.0
85.3
2020
Salary
28.0
42.8
65.0
Total pay and benefits
31.3
51.1
78.6
2019
Salary
23.1
36.4
65.0
Total pay and benefits
28.3
40.8
78.2
The calculation methodology used reflects Option B as defined under the relevant regulations. In line with the relevant regulations this utilises the
most recently collected and disclosed data analysed within our Gender Pay Gap report, with employees at the three quartiles identified from this
analysis and their respective single figure values calculated.
To ensure this data accurately reflects individuals at such quartiles, the single figure values for individuals immediately above and below the
identified employee at each quartile within the gender pay gap analysis were also reviewed.
In recent years our ratios have remained relatively consistent, reflecting how the single figures for both the Chief Executive and employees at the
quartile positions have remained stable when viewed over the period set out in the table above. In general we expect the ratios to be primarily
driven by the valuation of the long-term incentive that is included in the Chief Executive’s single figure for the year.
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Annual Report on Remuneration (continued)
Change in remuneration for Directors and all employees
In line with regulatory requirements, the table below calculates the percentage change in Directors’ remuneration (salary, taxable benefits and
annual bonus payment) compared to the average remuneration for other Vodafone Group employees who are measured on comparable business
objectives and who have been employed in the UK since 2020 (2020 to 2021), 2021 (2021 to 2022), 2022 (2022 to 2023), and 2023 (2023 to
2024) (per capita). Vodafone has employees based all around the world and some of these individuals work in countries with very high salary
inflation; therefore Vodafone’s UK-based Group employees are deemed the most appropriate employee group for this comparison.
Change from 2023 to 2024 (%)
Change from 2022 to 2023 (%)
Change from 2021 to 2022 (%)
Change from 2020 to 2021 (%)
Base
salary/fees
Taxable
benefits
Annual
bonus
Base salary/
fees
Taxable
benefits
Annual
bonus
Base
salary/fees
Taxable
benefits
Annual
bonus
Base
salary/fees
Taxable
benefits
Annual
bonus
Executive Directors
Margherita Della Valle
53.6
53.8
47.6
15.1
18.2
24.6
0.0
4.8
11.6
0.0
-4.5
19.3
Luka Mucic1
–
–
–
–
–
–
–
–
–
–
–
–
Non-Executive Directors
Jean-François van Boxmeer
0.0
34.5
–
0.0
61.1
–
118.9
–
–
–
–
–
Valerie Gooding2
-68.5
-30.0
–
0.0
11.1
–
0.0
–
–
0.0
-100.0
–
Stephen A. Carter CBE
45.6
50.0
–
–
–
–
–
–
–
–
–
–
Delphine Ernotte Cunci
45.6
0.0
–
–
–
–
–
–
–
–
–
–
Sir Crispin Davis2
-68.7
-33.3
–
0.0
33.3
–
0.0
800.0
–
0.0
-95.7
–
Michel Demaré
0.0
-9.1
–
0.0
1,000.0
–
0.0
–
–
0.0
-100.0
–
Hatem Dowidar3
–
–
–
–
–
–
–
–
–
–
–
–
Dame Clara Furse2
-68.7
-44.4
–
0.0
200.0
–
0.0
–
–
0.0
-100.0
–
Deborah Kerr
0.0
21.4
–
1,050.0
1,300.0
–
–
–
–
–
–
–
Amparo Moraleda
12.1
10.0
–
2.2
900.0
–
19.1
–
–
–
0.0
-100.0
David Nish
12.1
5.3
–
0.0
90.0
–
0.0
900.0
–
0.0
-96.8
–
Christine Ramon
161.4
1,400.0
–
–
–
–
–
–
–
–
–
–
Simon Segars
73.4
33.3
–
–
–
–
–
–
–
–
–
–
Other Vodafone Group
employees employed
in the UK
10.2
2.7
45.7
5.8
5.2
-9.6
2.5
0.3
80.0
3.8
0.2
30.2
Notes:
1. Luka Mucic was appointed as Group Chief Financial Officer on 1 September 2023.
2. Valerie Gooding, Sir Crispin Davis, and Dame Clara Furse stepped down on 25 July 2023.
3. Hatem Dowidar was appointed on 19 February 2024.
As set out in last year’s report, the year-on-year increase in Margherita Della Valle’s pay between 2022 and 2023 reflects Margherita’s change in
role during the period. The percentage increase in the table above does not reflect the actual increase during the year under review in respect of
the salary payable for the role of Chief Executive which was increased by 3% effective 1 July 2022. Further details can be found in the 2023
Directors’ Remuneration Report.
The significant year-on-year increase in fees and taxable benefits for Christine Ramon between 2023 and 2024, Deborah Kerr between 2022 and
2023, and Jean-François van Boxmeer between 2021 and 2022 reflect how the values in the previous year were not based on a full 12 months of
service due to their respective appointments at various points in the year. Therefore the year-on-year increase does not indicate an actual
increase in the fees payable to the Chairman and Non-Executive Directors during those periods.
Whilst some of the percentages within the ‘Taxable benefits’ column look significant, these actually reflect relatively small increases in value when
viewed on an absolute basis. The significant change in taxable benefits for the period between 2021 and 2022 reflect how certain travel and
accommodation expenses in relation to attending Board meetings were lower than normal in 2021 due to the impact of COVID-19 on the ability
to attend meetings in-person.
Assessing pay and performance
In the table on the next page we summarise the Chief Executive’s single figure remuneration over the past 10 years and how our variable pay
plans have paid out in relation to the maximum opportunity. This can be compared with the historic TSR performance over the same period. The
chart below shows the performance of the Company relative to the STOXX Europe 600 Index over a 10-year period. The STOXX Europe 600 Index
was selected as this is a broad-based index that includes markets in which we operate. It should be noted that the TSR element of the 2022 GLTI is
based on the TSR performance shown in the chart on page 109 and not this chart.
10-year historical TSR performance
Growth in the value of a hypothetical €100 holding over 10 years
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
126
133
82
116
160
175
100
122
107
125
121
116
107
103
68
87
89
181
66
210
59
Vodafone Group
STOXX Europe
600 Index
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Other information
Financial year remuneration for Chief Executive
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2,7401
3,5073
Single figure of total remuneration £’000
2,810
5,224
6,332
7,389 /1,6192
3,529
3,551
4,173
/8874
4,380
Annual bonus
(actual award versus max opportunity)
56%
58%
47%
64%
44%
52%
62%
69%
56%
71%
Long-term incentive
(vesting versus max opportunity)
0%
23%
44%
67%
40%
50%
22%
26%
53%
49%
Notes:
1. Reflects the single figure in respect of Vittorio Colao for the period of 1 April 2018 to 30 September 2018.
2. Reflects the single figure in respect of Nick Read for the period of 1 October 2018 to 31 March 2019.
3. Reflects the single figure in respect of Nick Read for the period of 1 April 2022 to 31 December 2022.
4. Reflects the single figure in respect of Margherita Della Valle for the period of 1 January 2023 to 31 March 2023.
LTI
average 37%
Annual bonus
average 58%
2025 remuneration
Details of how key elements of the Remuneration Policy will be implemented for the 2025 financial year are set out below.
2025 base salaries
As part of this year’s review, conducted in March 2024, the Committee reviewed executive remuneration arrangements against its comparator
group of FTSE 30 companies (excluding financial services).
Following the review the Committee concluded that the salaries of the Executive Directors would remain unchanged. This was felt to be
appropriate considering Margherita Della Valle’s salary increase following her permanent appointment as Group Chief Executive in April 2023, and
given Luka Mucic’s salary was set appropriately when he joined as Chief Financial Officer in September 2023. As a result, the salaries for the
Executive Directors are as follows:
– Group Chief Executive (Margherita Della Valle): £1,250,000
– Group Chief Financial Officer (Luka Mucic): £760,000
2025 annual bonus (‘GSTIP’)
Following its annual review of the GSTIP structure, the Committee agreed that the performance measures and associated weightings continue to
support the strategic priorities of Growth and Customers and therefore the 2025 plan should remain unchanged from 2024 as follows:
Growth (70% of total)
Service revenue (20%); adjusted EBIT (20%); adjusted free cash flow (20%); and revenue market share (10%).
Customers (30% of total)
Net Promoter Score1 (20%); and churn (10%).
Note:
1. The assessment of NPS utilises data collected in our local markets which is validated for quality and consistency by independent third-party agencies.
Due to the potential impact on our commercial interests, annual bonus targets are considered commercially sensitive and therefore will be
disclosed in the 2025 Remuneration Report following the completion of the financial year.
Long-term incentive (‘GLTI’) awards for 2025
Awards for 2025 will be made in line with the arrangements described in our policy on pages 102 and 103. Vesting of the 2025 award will be
subject to adjusted free cash flow (60% of total award), relative TSR (30% of total award), and ESG (10% of total award) performance. Performance
will be measured over the three financial years ending 31 March 2027, and any net vested shares will be subject to an additional two-year holding
period. It is anticipated that the final awards will be reviewed by the Committee at the July 2024 meeting and, subject to the Committee’s
approval, will be granted shortly afterwards.
Further details of the 2025 award targets are provided below and on the next page.
Adjusted free cash flow (60% of total award)
Details of the final three-year adjusted free cash flow target range will be disclosed in the relevant market announcement at the time of grant and
published in the 2025 Directors’ Remuneration Report.
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Annual Report on Remuneration (continued)
Relative TSR (30% of total award)
Following the annual review of the performance measures, which included a review of analysis provided by the Committee’s external advisers,
the Committee determined that the TSR outperformance range for the 2025 award should be set at 7.0% p.a. at maximum. The Committee
reviewed the TSR peer group and noted the removal of Telefónica Deutschland based on its recent unlisted status, and agreed to remove Royal KPN based
on its relevance to the Company. Further details on the TSR outperformance range and peer group for the 2025 award are set out in the tables below.
Relative TSR (30% of total award)
TSR outperformance
Vesting (% of relative TSR element)
Below threshold
Below median
0.0%
Threshold
Median
20.0%
Maximum
7.0% p.a.
100.0%
TSR peer group
BT Group
Deutsche Telekom
Liberty Global
MTN
Orange
Telecom Italia
Telefónica
Linear interpolation (i.e. straight-line vesting) occurs for performance between threshold and maximum.
ESG (10% of total award)
The table below sets out how performance under the ESG measure for the 2025 award will be assessed against two quantitative ambitions:
Purpose focus area1
Metric for 2025 GLTI
Overall ambition
Baseline position for 2025 GLTI
Ambition for 2025 GLTI
Protecting our
Planet
Net zero
90% reduction in Scope 1 & 2
emissions by 2030 against a
FY20 baseline2
66% reduction in Scope 1 & 2
emissions versus a FY20 baseline
at 31 March 2024
86% reduction in Scope 1 & 2
emissions versus a FY20 baseline
by 31 March 2027
Empowering
People
Female representation
in management
40% representation of women
in management by 2030
35% representation of women in
management at 31 March 2024
37% representation of women in
management by 31 March 2027
Notes:
1. This year our Company Purpose has been refreshed and applicable focus areas outlined above have been renamed to Protecting the Planet and Empowering People. Read more on page 80.
2. This near-term greenhouse gas emissions reduction target has been validated by the Science Based Targets initiative (‘SBTi’).
Each ambition for the 2025 award has been set by considering both our externally communicated targets and our internal progress as at 31 March 2024.
The Committee agreed to remove the financial inclusion metric included in previous awards based on its sole focus on Vodacom Group which
limits its global reach compared to other metrics outlined above.
At the end of the performance period the Committee will assess achievement across the two metrics against the stated ambitions and determine vesting
under this element. Full disclosure of the rationale for the final vesting decision will be provided in the relevant Directors’ Remuneration Report.
2025 remuneration for the Chair and Non-Executive Directors
Fees for our Chair and Non-Executive Directors have been benchmarked against the FTSE 30 (excluding financial services companies). Following
this year’s review it was agreed that the current additional fee levels for the Senior Independent Director and/or Committee Chairs would be
increased. While it was agreed there would be no changes to the Chair and Non-Executive Director base fee at this time, fees will be assessed in
next year’s review. Details of the 2025 fee levels are set out in the table below.
Position/role
2025 fee payable
£’000
2024 fee payable
£’000
Chair1
650
650
Non-Executive Director
115
115
Additional fee for the Senior Independent Director
35
25
Additional fee for Committee Chair: Audit & Risk
40
25
Additional fee for Committee Chair: Remuneration, ESG, and Technology
35
25
Note:
1. The Chair’s fee also includes the fee for the chairing of the Nominations and Governance Committee.
Further remuneration information
Dilution
All awards are made under plans that incorporate dilution limits as set out in the guidelines for share incentive schemes published by the Investment Association.
The current estimated dilution from subsisting executive awards is approximately 2.8% of the Company’s share capital at 31 March 2024 (2.4% at 31 March
2023), whilst from all-employee share awards it is approximately 0.3% (0.3% at 31 March 2023). This gives a total dilution of 3.1% (2.7% at 31 March 2023).
Service contracts
The terms and conditions of appointment of our Directors are available for inspection at the Company’s registered office during normal business
hours and at the Annual General Meeting (for 15 minutes prior to the meeting and during the meeting). The Executive Directors have notice
periods in their service contracts of 12 months. The Non-Executive Directors’ letters of appointment do not contain provision for notice periods or
for compensation if their appointments are terminated.
This report on remuneration has been approved by the Board of Directors and signed on its behalf by:
Amparo Moraleda
On behalf of the Remuneration Committee
14 May 2024
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Our US listing requirements
Board member independence
Different tests of independence for Board members are applied under the 2024 UK Corporate
Governance Code (the ‘Code’) and the NASDAQ listing rules (the ‘NASDAQ Listing Rules’). The
Board is not required to take into consideration NASDAQ’s detailed definitions of independence
as set out in the NASDAQ Listing Rules. The Board has carried out an assessment based on the
independence requirements of the Code and has determined that, in its judgement, each of
Vodafone’s Non-Executive Directors is independent within the meaning of those requirements.
Committees
The NASDAQ Listing Rules require US companies to have a nominations committee, an audit
committee and a compensation committee, each composed entirely of independent directors,
with the nominations committee and the audit committee each required to have a written charter
that addresses the committee’s purpose and responsibilities, and the compensation committee
having sole authority and adequate funding to engage compensation consultants, independent
legal counsel and other compensation advisers.
– Our Nominations and Governance Committee is chaired by the Chair of the Board and its other
members are independent Non-Executive Directors.
– Our Remuneration Committee is composed entirely of independent Non-Executive Directors.
– Our Audit and Risk Committee is composed entirely of Non-Executive Directors, each of whom
(i) the Board has determined to be independent based on the independence requirements of
the Code; and (ii) meets the independence requirements of the Securities Exchange Act of
1934.
– We have terms of reference for our Nominations and Governance Committee, Audit and Risk
Committee and Remuneration Committee, all of which comply with the requirements of the
Code and are available for inspection on our website at vodafone.com/governance.
– These terms of reference are generally responsive to the relevant NASDAQ Listing Rules, but
may not address all aspects of these rules.
Code of Ethics and Code of Conduct
Under the NASDAQ Listing Rules, US companies must adopt a Code of Conduct applicable to all
directors, officers and employees that complies with the definition of a ‘Code of Ethics’ set out in
section 406 of the Sarbanes-Oxley Act.
– We have adopted a Code of Ethics that complies with section 406 of the Sarbanes-Oxley Act
that is applicable only to the senior financial and principal executive officers.
Click to read our Code of Ethics:
vodafone.com/governance
– We have also adopted a separate Code of Conduct which applies to all employees.
Quorum
The quorum required for shareholder meetings, in accordance with our Articles of Association, is
two shareholders, regardless of the level of their aggregate share ownership, while US companies
listed on NASDAQ are required by the NASDAQ Listing Rules to have a minimum quorum of
33.33% of the holders of ordinary shares for shareholder meetings.
Related-party transactions
In lieu of obtaining an independent review of related-party transactions for conflicts of interests
in accordance with the NASDAQ Listing Rules, we seek shareholder approval for related-party
transactions that (i) meet certain financial thresholds, or (ii) have unusual features in accordance
with the Listing Rules issued by the Financial Conduct Authority (FCA) in the UK (the ‘FCA Listing
Rules’), the Companies Act 2006 and our Articles of Association.
Further, we use the definition of a transaction with a related party as set out in the FCA Listing
Rules, which differs in certain respects from the definition of related party transaction in the
NASDAQ Listing Rules.
Shareholder approval
When determining whether shareholder approval is required for a proposed transaction, we
comply with both the NASDAQ Listing Rules and the FCA Listing Rules. Under the NASDAQ
Listing Rules, whether shareholder approval is required for a transaction depends on, among
other things, the percentage of shares to be issued or sold in connection with the transaction.
Under the FCA Listing Rules, whether shareholder approval is required for a transaction depends
on, among other things, whether the size of a transaction exceeds a certain percentage of the
size of the listed company undertaking the transaction.
As Vodafone’s American Depositary Shares are listed on The NASDAQ Global Select Market of the NASDAQ Stock Market LLC (‘NASDAQ’), we are
required to disclose a summary of any material differences between the corporate governance practices we follow and those of US companies
listed on NASDAQ. Vodafone’s corporate governance practices are primarily based on UK requirements but substantially conform to those
required of US companies listed on NASDAQ.
The material differences are set out in the following table:
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Directors’ Report
The Directors of the Company present their report
together with the audited consolidated financial
statements for the year ended 31 March 2024.
This report has been prepared in accordance with the requirements
outlined within the Large and Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008 and forms part of the
management report as required under Disclosure Guidance and
Transparency Rule (‘DTR’) 4. Certain information that fulfils the
requirements of the Directors’ Report can be found elsewhere in this
document and is referred to below. This information is incorporated
into this Directors’ Report by reference.
Vodafone Group Plc is incorporated and domiciled in England and
Wales (registration number 1833679). The registered address and
contact number of the Company is Vodafone House, The Connection,
Newbury, Berkshire, RG14 2FN, England, telephone +44 (0)1635
33251.
Responsibility statement
As required under the DTRs, a statement made by the Board
regarding the preparation of the financial statements is set out on
pages 123 to 124, which also provides details regarding the disclosure
of information to the Company’s auditor and management’s report
on internal control over financial information.
Going concern
The going concern statement required by the Listing Rules and
the UK Corporate Governance Code (the ‘Code’) is set out in the
‘Directors’ statement of responsibility’ section on page 124.
System of risk management and internal control
The Board is responsible for maintaining a risk management and
internal control system and for managing the principal risks faced by
the Group. Such a system is designed to manage rather than
eliminate business risks and can only provide reasonable and not
absolute assurance against material mistreatment or loss. This is
described in more detail in the Audit and Risk Committee Report on
pages 89-94.
The Board has implemented in full the Financial Reporting Council’s
(‘FRC’) ‘Guidance on Risk Management, Internal Control and Related
Financial and Business Reporting’ for the year and up to the date of
this Annual Report. The resulting procedures, which are subject to
regular monitoring and review, provide an ongoing process for
identifying, evaluating and managing the Company’s principal risks
(which can be found on pages 57-63).
Corporate Governance Statement
The Corporate Governance Statement setting out how the Company
complies with the Code is set out on page 73. This includes a
description of the main features of our internal control and risk
management arrangements in relation to the financial reporting
process. The information required by DTR 7.2.6R can be found in the
‘Shareholder information’ section on pages 249-254. A description of
the composition and operation of the Board and its Committees
including the Board Diversity Policy is set out on page 74, pages
86-97 and page 106. The Code can be viewed in full at frc.org.uk.
Strategic Report
The Strategic Report is set out on pages 1-69 and is incorporated into
this Directors’ Report by reference.
Directors and their interests
The Directors of the Company who served during the financial year
ended 31 March 2024 and up to the date of signing the financial
statements are as follows: Jean-François van Boxmeer, Margherita
Della Valle, Luka Mucic (appointed 1 September 2023), Stephen A.
Carter CBE, Delphine Ernotte Cunci, Michel Demaré, Hatem Dowidar
(appointed 19 February 2024), Deborah Kerr, Maria Amparo Moraleda
Martinez, David Nish, Christine Ramon and Simon Segars. Sir Crispin
Davis, Dame Clara Furse and Valerie Gooding stepped down at the
conclusion of the AGM on 25 July 2023. A summary of the rules
relating to the appointment and replacement of Directors and
Directors’ powers can be found on pages 250-251. Details of the
Directors’ interests in the Company’s ordinary shares, options held
over ordinary shares, interests in share options and long-term
incentive plans are set out on pages 98-118.
Directors’ conflicts of interest
Established within the Company is a procedure for managing and
monitoring conflicts of interest for Directors. Details of this procedure
are set out on page 87.
Directors’ indemnities
In accordance with our Articles of Association, and to the extent
permitted by law, Directors are granted an indemnity by the Company
in respect of liability incurred as a result of their office. In addition, we
maintained a directors’ and officers’ liability insurance policy
throughout the year. Neither our indemnity nor the insurance
provides cover in the event that a Director is proven to have acted
dishonestly or fraudulently.
Disclosures required under Listing Rule 9.8.4
The information on the amount of interest capitalised and the
treatment of tax relief can be found in notes 5 and 6 to the
consolidated financial statements, respectively. The remaining
disclosures required by Listing Rule 9.8.4 are not applicable to
Vodafone.
Capital structure and rights attaching to shares
Ordinary shares of Vodafone Group Plc are traded on the London
Stock Exchange and in the form of American Depositary Shares
(‘ADS’) on NASDAQ.
ADSs, each representing 10 ordinary shares, are traded on NASDAQ
under the symbol ‘VOD’. The ADSs are evidenced by American
Depositary Receipts (‘ADRs’) issued by J.P. Morgan, as depositary,
under a deposit agreement, dated 15 February 2022 between the
Company, the depositary and the holders from time to time of ADRs
issued thereunder.
ADS holders are not shareholders in the Company but may instruct
J.P. Morgan on the exercise of voting rights relative to the number of
ordinary shares represented by their ADSs. See the sections ‘Articles
of Association and applicable English law’ and ‘Rights attaching
to the Company’s shares – Voting rights’ on pages 250-251.
All information relating to the Company’s capital structure, rights
attaching to shares, dividends, the policy to repurchase the
Company’s own shares, details of Company share repurchases and
details of other shareholder information is contained on pages 30-31
and pages 249-254.
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Other information
The Directors’ Report was approved by the Board and signed on
its behalf by the Group General Counsel and Company Secretary.
Maaike de Bie
Group General Counsel and Company Secretary
14 May 2024
Change of control
Details of change of control provisions in the Company’s revolving
credit facilities are set out in note 22 ‘Capital and financial risk
management’.
Information on agreements between the Company and its Directors
providing for compensation for loss of office of employment
(including details of change of control provisions in share schemes) is
set out on pages 104-105. Other than these, there are no agreements
between the Company and its employees providing for compensation
for loss of office or employment that occurs because of a takeover
bid.
Dividends
Full details of the Company’s dividend policy and proposed final
dividend payment for the year ended 31 March 2024 are set out on
page 31 and note 9 ‘Equity dividends’ to the consolidated financial
statements.
Sustainability
Information about the Company’s approach to sustainability risks and
opportunities is set out on pages 32-55 and on pages 57-69.
UK Streamlined Energy and Carbon Reporting
In accordance with UK Streamlined Energy and Carbon Reporting
(SECR) requirements, we monitor and report on the greenhouse gas
(GHG) emissions of our operations, the intensity of our GHG emissions
relative to revenue, and our energy consumption for Vodafone UK.
Please see the Sustainable Business section of our Strategic Report
for more details on our GHG and energy performance (pages 38-39)
and our SECR data disclosure (page 55).
Political donations
No political donations or contributions to political parties under
the Companies Act 2006 were made during the financial year.
The Group policy is that no political donations be made or political
expenditure incurred.
Financial risk management objectives and policies
Disclosures relating to financial risk management objectives and
policies, including our policy for hedging, are set out in note 22 to the
consolidated financial statements, and disclosures relating to
exposure to credit risk, liquidity risk and market risk are outlined in
note 22.
Important events since the end of the financial year
There were no material events to report since the end of the financial
year.
Future developments within the Group
The Strategic Report contains details of likely future developments
within the Group.
Group policy compliance
Each Group policy is owned by a member of the Executive Committee
so that there is clear accountability and authority for ensuring the
associated business risk is adequately managed. Regional Chief
Executives and the Senior Leadership Team member responsible for
each Group function have primary accountability for ensuring
compliance with all Group policies by all our markets and entities.
Our Group compliance team and policy champions support the policy
owners and local markets in implementing policies and monitoring
compliance. All the key Group policies have been consolidated into
the Vodafone Code of Conduct, which applies to all employees and
those who work for or on behalf of Vodafone. It sets out the standards
of behaviour expected in relation to areas such as insider dealing,
bribery and raising concerns through the whistleblowing process
(known internally as ‘Speak Up’).
Read more on
page 44
Branches
The Group, through various subsidiaries, has branches in a number of
different jurisdictions in which the business operates. Further details
are included in note 31 ‘Related undertakings’.
Employee disclosures
Vodafone is an inclusive employer and diversity is important to us.
We give full and fair consideration to applications for employment by
disabled persons and the continued employment of anyone incurring
a disability while employed by us. Training, career development and
promotion opportunities are equally applied for all our employees,
regardless of disability. Our disclosures relating to the employment of
women in senior management roles, diversity, employee engagement
and policies are set out on page 13, pages 17 and 18, page 80,
page 87 and page 88.
Directors’ Report (continued)
121
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Financials
Other information
123 Directors’ statement of responsibility
125 Independent auditor’s report to the members of Vodafone Group Plc
135 Consolidated financial statements
135 Consolidated income statement
135 Consolidated statement of comprehensive income/(expense)
136 Consolidated statement of financial position
137 Consolidated statement of changes in equity
138 Consolidated statement of cash flows
139 Notes to the consolidated financial statements
139
1. Basis of preparation
Income statement
148
2. Revenue disaggregation and segmental analysis
152
3. Operating profit
153
4. Impairment losses
158
5. Investment income and financing costs
159
6. Taxation
164
7. Discontinued operations and assets held for sale
168
8. Earnings per share
168
9. Equity dividends
Financial position
169
10. Intangible assets
171
11. Property, plant and equipment
173
12. Investments in associates and joint arrangements
181
13. Other investments
182
14. Trade and other receivables
183
15. Trade and other payables
184
16. Provisions
185
17. Called-up share capital
Cash flows
186
18. Reconciliation of net cash flow from operating activities
186
19. Cash and cash equivalents
187
20. Leases
190
21. Borrowings
192
22. Capital and financial risk management
Employee remuneration
202
23. Directors’ and key management compensation
203
24. Employees
204
25. Post-employment benefits
208
26. Share-based payments
Additional disclosures
210
27. Acquisitions and disposals
212
28. Commitments
212
29. Contingent liabilities and legal proceedings
216
30. Related party transactions
217
31. Related undertakings
226
32. Subsidiaries exempt from audit
227 Company financial statements of Vodafone Group Plc
227 Company statement of financial position of Vodafone Group Plc
228 Company statement of changes in equity of Vodafone Group Plc
229 Notes to the Company financial statements
229
1. Basis of preparation
231
2. Fixed assets
232
3. Debtors
232
4. Other investments
232
5. Creditors
233
6. Called-up share capital
233
7. Share-based payments
233
8. Reserves
234
9. Equity dividends
234
10. Contingent liabilities and legal proceedings
234
11. Other matters
235 Non-GAAP measures (unaudited information)
248 Additional information (unaudited information)
Reporting on our financial performance
Index
122
Vodafone Group Plc
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Governance
Financials
Other information
Directors’ statement of responsibility
The Directors are responsible for preparing the
financial statements in accordance with applicable
law and regulations and for keeping proper
accounting records. Detailed below are statements
made by the Directors in relation to their
responsibilities, disclosure of information to the
Company’s auditor, going concern and
management’s report on internal control over
financial reporting.
Financial statements and accounting records
Company law of England and Wales requires the Directors to prepare
financial statements for each financial year that give a true and fair
view of the state of affairs of the Company and of the Group at the
end of the financial year and of the profit or loss of the Group for that
period. In preparing those financial statements, the Directors are
required to:
– Select suitable accounting policies and apply them consistently;
– Make judgements and estimates that are reasonable and prudent;
– Present information, including accounting policies, in a
manner that provides relevant, reliable, comparable and
understandable information;
– State whether the consolidated financial statements have been
prepared in accordance with UK-adopted International Accounting
Standards (‘IAS’), with International Financial Reporting Standards
(‘IFRS’) as issued by the International Accounting Standards Board
(‘IASB’) and with the requirements of the UK Companies Act
2006 (the ‘Act’);
– State for the Company’s financial statements whether applicable
UK accounting standards have been followed; and
– Prepare the financial statements on a going concern basis unless it
is inappropriate to presume that the Company and the Group will
continue in business.
The Directors are responsible for keeping proper accounting records
that disclose with reasonable accuracy at any time the financial
position of the Company and of the Group and enable them to
ensure that the financial statements are prepared in accordance
with UK-adopted IAS, with IFRS as issued by the IASB and with the
requirements of the Act. They are also responsible for the system
of internal control, for safeguarding the assets of the Company and
the Group, and for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the
Company’s website. Legislation in the United Kingdom governing the
preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
Directors’ responsibility statement
Each of the Directors, whose names and functions are listed on pages
76 to 78, confirms that, to the best of their knowledge:
– The consolidated financial statements, prepared in accordance
with UK-adopted IAS, with IFRS as issued by the IASB and with the
requirements of the Act, give a true and fair view of the assets,
liabilities, financial position and profit of the Group;
– The parent company financial statements, prepared in accordance
with UK generally accepted accounting practice, give a true and fair
view of the assets, liabilities, financial position and profit of the
Company; and
– The Strategic Report includes a fair review of the development and
performance of the business and the position of the Group,
together with a description and robust assessment of the principal
risks and uncertainties that it faces.
The Directors are also responsible under section 172 of the
Companies Act 2006 for promoting the success of the Company for
the benefit of its members as a whole and in doing so have regard for
the needs of wider society and stakeholders, including customers,
consistent with the Group’s core and sustainable business objectives.
Having taken advice from the Audit and Risk Committee, the Board
considers the Annual Report, taken as a whole, is fair, balanced and
understandable and that it provides the information necessary for
shareholders to assess the Company’s position and performance,
business model and strategy.
Neither the Company nor the Directors accepts any liability to any
person in relation to the Annual Report except to the extent that such
liability could arise under English law. Accordingly, any liability to a
person who has demonstrated reliance on any untrue or misleading
statement or omission shall be determined in accordance with
section 90A and schedule 10A of the Financial Services and Markets
Act 2000.
Disclosure of information to the auditors
Having made the requisite enquiries, so far as the Directors are aware,
there is no relevant audit information (as defined by section 418(3) of
the Companies Act 2006) of which the Company’s auditor is unaware
and the Directors have taken all the steps they ought to have taken to
make themselves aware of any relevant audit information and to
establish that the Company’s auditor is aware of that information.
123
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Other information
Going concern
The Group’s business activities, performance, position, principal risks
and uncertainties and the Directors’ assessment of its long-term
viability are set out on page 63.
In addition, the funding position of the Group is included in
‘Borrowings’ and ‘Capital and financial risk management’ in notes 21
and 22, respectively, to the consolidated financial statements. Notes
21 and 22 include disclosure in relation to the Group’s objectives,
policies and processes for managing, as well as details regarding its
capital, its financial risk management objectives, its financial
instruments and hedging activities, and its exposures to credit risk and
liquidity risk. As noted on pages 193 to 194, the Group has access to
substantial cash and financing facilities.
The Group also believes it adequately manages or mitigates its
solvency and liquidity risks through two primary processes, described
below
Business planning process and performance management
The Group’s forecasting and planning cycle consists of in-year
forecasts, a budget and a long-range plan. These generate income
statement, cash flow and net debt projections for assessment by
Group management and the Board. Each forecast is compared with
prior forecasts and actual results to identify variances and understand
the drivers of the changes and their future impact so management
can take action where appropriate. Additional analysis is undertaken
to review and sense check the key assumptions underpinning the
forecasts. These forecasts also review the expected outcomes of
announced M&A transactions.
Cash flow and liquidity reviews
The business planning process provides outputs for detailed cash flow
and liquidity reviews, to ensure that the Group maintains adequate
liquidity throughout the forecast periods. The prime output is a
liquidity forecast that is prepared and updated at least on a monthly
basis, which highlights the extent of the Group’s liquidity based on
controlled cash flows and the headroom under the Group’s undrawn
revolving credit facility. The key inputs into this forecast are:
– Free cash flow forecasts with information taken from the business
planning process;
– Bond and other debt maturities;
– Completion of committed M&A transactions; and
– Expectations for shareholder returns and spectrum auctions.
The liquidity forecast is reviewed by the Group Chief Financial Officer
and included in each of the reports to the Board. In addition, the
Group continues to manage its foreign exchange and interest rate
risks within the framework of policies and guidelines authorised and
reviewed by the Board, with oversight provided by the Treasury Risk
Committee.
The Directors have also considered sensitivities in respect of potential
downside scenarios in concluding that the Group is able to continue
in operation for the period to 30 June 2025 from the date of
approving the consolidated financial statements. These sensitivities
include the non-refinancing of debt maturities, the failure of M&A
disposal transactions to complete in the assessment period mitigated
by the cessation of share buyback plans. A reverse stress test was
reviewed to understand how severe conditions would have to be to
breach liquidity, including a required reduction in Adjusted EBITDAaL
compared to current performance and forecasts. The Directors also
considered the availability of the Group’s €7.8 billion undrawn
revolving credit facilities as at 31 March 2024.
The Directors also considered the findings of the work performed to
support the statement on the long-term viability of the Group. As
noted on page 63, this included key changes to relevant principal
risks in light of global economic and political uncertainty, sensitivity
analysis, scenario assessments, and combinations of these, over the
viability assessment period.
Conclusion
Based on the review, the Directors have a reasonable expectation that
the Company and the Group have adequate resources to continue
in operational existence for the foreseeable future. Accordingly, the
Directors continue to adopt the going concern basis in preparing the
Annual Report and Accounts.
Controls over financial reporting
Management is responsible for establishing and maintaining adequate
internal control over financial reporting for the Group.
The Group’s internal control over financial reporting includes policies
and procedures that:
– Pertain to the maintenance of records that, in reasonable detail,
accurately and fairly reflect transactions and dispositions of assets;
– Are designed to provide reasonable assurance that transactions
are recorded as necessary to permit the preparation of financial
statements in accordance with UK-adopted IAS, with IFRS as issued
by the IASB and with the requirements of the Act, and that receipts
and expenditures are being made only in accordance with
authorisation of management and the Directors of the Company; and
– Provide reasonable assurance regarding prevention or timely detection
of unauthorised acquisition, use or disposition of the Group’s assets that
could have a material effect on the financial statements.
During the year covered by this report, there were no changes in the
Group’s internal control over financial reporting that have materially
affected or are reasonably likely to materially affect the effectiveness
of the internal controls over financial reporting.
Any internal control framework, no matter how well designed, has
inherent limitations including the possibility of human error and the
circumvention or overriding of the controls and procedures, and may
not prevent or detect misstatements. Furthermore, projections of any
evaluation of effectiveness to future periods are subject to the risk
that controls may become inadequate because of changes in conditions or
because the degree of compliance with the policies or procedures
may deteriorate.
By order of the Board
Maaike de Bie
Group General Counsel and Company Secretary
14 May 2024
Directors’ statement of responsibility (continued)
124
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Financials
Other information
Opinion
In our opinion:
– Vodafone Group Plc’s consolidated financial statements and
separate Company financial statements (the “financial statements”)
give a true and fair view of the state of the Group’s and of the
Company’s affairs as at 31 March 2024 and of the Group’s profit for
the year then ended;
– the consolidated financial statements have been properly prepared
in accordance with UK adopted international accounting standards;
– the Company financial statements have been properly prepared in
accordance with United Kingdom Generally Accepted Accounting
Practice; and
– the financial statements have been prepared in accordance with
the requirements of the Companies Act 2006.
We have audited the financial statements of Vodafone Group Plc (the
‘Parent company’ or ‘Company’) and its subsidiaries (the ‘Group’) for
the year ended 31 March 2024 which comprise:
Group
Company
Consolidated statement of
financial position as at 31 March
2024
Company statement of financial
position as at 31 March 2024
Consolidated income statement
for the year then ended
Company statement of changes
in equity for the year then ended
Consolidated statement of
comprehensive income/
(expense) for the year then
ended
Related notes 1 to 11 to the
Company financial statements
including material accounting
policy information
Consolidated statement of
changes in equity for the year
then ended
Consolidated statement of cash
flows for the year then ended
Related notes 1 to 32 to the
consolidated financial statements,
including material accounting
policy information
The financial reporting framework that has been applied in the
preparation of the consolidated financial statements is applicable law
and UK adopted international accounting standards. The financial
reporting framework that has been applied in the preparation of the
Company financial statements is applicable law and United Kingdom
Accounting Standards, including FRS 101 ‘Reduced disclosure
framework’ (United Kingdom Generally Accepted Accounting
Practice).
Basis for opinion
We conducted our audit in accordance with International Standards
on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities
under those standards are further described in the Auditor’s
responsibilities for the audit of the financial statements section of our
report. We believe that the audit evidence we have obtained is
sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and Parent company in accordance
with the ethical requirements that are relevant to our audit of the
financial statements in the UK, including the FRC’s Ethical Standard as
applied to listed public interest entities, and we have fulfilled our
other ethical responsibilities in accordance with these requirements.
The non-audit services prohibited by the FRC’s Ethical Standard were
not provided to the Group or the Parent company and we remain
independent of the Group and the Parent company in conducting the
audit.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
directors’ use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our evaluation
of the directors’ assessment of the Group and Parent company’s
ability to continue to adopt the going concern basis of accounting
included:
– confirming our understanding of the directors’ going concern
assessment process, including the controls over the review and
approval of the budget and long-range plan;
– assessing the appropriateness of the duration of the going concern
assessment period to 30 June 2025 (“the going concern
assessment period”) and considering the existence of any
significant events or conditions beyond this period based on our
procedures on the Group’s long-range plan and knowledge arising
from other areas of the audit;
– verifying inputs against board-approved forecasts and debt facility
terms and reconciling the opening liquidity position to the balance
sheet at 31 March 2024;
– reviewing borrowing facilities to confirm both their availability to
the Group and the forecast debt repayments through the going
concern assessment period and to validate that there are no
financial covenants in relation to any of the loan arrangements;
– testing the assessment, including forecast liquidity, for clerical
accuracy;
– challenging whether assumptions made were reasonable and
appropriately severe, in light of the Group’s relevant principal risks
and uncertainties and our own independent assessment of those
risks;
– evaluating management’s historical forecasting accuracy and the
consistency of the going concern assessment with information
obtained from other areas of the audit, such as our audit
procedures on the long-range plans, which underpin
management’s goodwill impairment assessments and our
procedures in relation to the businesses classified as held for sale
within discontinued operations;
– evaluating the identified mitigating actions available to respond to
a severe downside scenario, and whether those actions are feasible
and within the Group’s control;
– challenging the appropriateness of management’s ‘reverse stress
test’ downside scenario, to understand how severe conditions
would have to be to breach liquidity and whether the reduction in
EBITDAaL required has no more than a remote possibility of
occurring when compared to historical financial performance;
– performing independent sensitivity analysis on management’s
assumptions, including applying incremental adverse cashflow
sensitivities. These sensitivities included the impact of certain
severe but plausible scenarios, evaluated as part of management’s
work on the Group’s long term viability materialising within the
going concern assessment period; and
– assessing the appropriateness of the going concern disclosure on
page 124.
Independent auditor’s report to the members of Vodafone Group Plc
125
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Annual Report 2024
Strategic report
Governance
Financials
Other information
Our key observations
– The directors’ assessment forecasts that the Group will maintain
sufficient liquidity throughout the going concern assessment
period. This included the scenario of non-refinancing of certain
debt maturities in the assessment period and also the continuing
availability of the Group’s €7.8 billion revolving credit facilities,
undrawn as at 31 March 2024.
– Furthermore, management’s reverse stress test to model the
extent of the EBITDAaL reduction compared to forecasts required
to breach liquidity during the going concern assessment period is
considered by management to have only a remote possibility of
occurring when compared to historical financial performance. The
stress test included downside sensitivities in relation to the
completion of both the Vodafone Spain and Vodafone Italy
disposals for which the estimated proceeds are included within the
base case.
– With the exception of the cessation of share buyback plans
anticipated post-completion of business disposals, the controllable
mitigating actions available to increase liquidity over the going
concern assessment period were not modelled by management
due to the level of headroom in the directors’ assessment forecasts.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the Group
and Parent company’s ability to continue as a going concern for a
period from when the financial statements are authorised for issue to
30 June 2025.
In relation to the Group and Parent company’s reporting on how they
have applied the UK Corporate Governance Code, we have nothing
material to add or draw attention to in relation to the directors’
statement in the financial statements about whether the directors
considered it appropriate to adopt the going concern basis of
accounting.
Our responsibilities and the responsibilities of the directors with
respect to going concern are described in the relevant sections of this
report. However, because not all future events or conditions can be
predicted, this statement is not a guarantee as to the Group’s ability to
continue as a going concern.
Overview of our audit approach
Audit scope
– We performed an audit of the complete financial
information of 9 components, 2 of which were
classified as ‘held for sale’ and discontinued
operations. We also performed full audit procedures
on specific balances for 4 components, specified
audit procedures on specific balances for a further 6
components and other procedures on the remaining
300 components.
– In respect of continuing operations, the components
where we performed full audit procedures accounted
for 72% of Adjusted EBITDAaL and where we
performed full or specified audit procedures in
respect of revenue accounted for 79% of Revenue.
Key audit
matters
– Carrying value of cash generating units, including
goodwill
– Recognition and recoverability of deferred tax assets
on tax losses – Luxembourg
– Revenue recognition
Materiality
– Overall Group materiality of €220m (FY23: €300m)
has been calculated based on Adjusted EBITDAaL as
defined in the ‘Our application of materiality’ section
of this report. This materiality represents 2% of the
Group’s Adjusted EBITDAaL as reported in Note 2 in
the Consolidated financial statements.
An overview of the scope of the Parent company
and Group audits
Tailoring the scope
Our assessment of audit risk, our evaluation of materiality and our
allocation of performance materiality determine our audit scope for
each company within the Group. Taken together, this enables us to
form an opinion on the consolidated financial statements. We take
into account size, risk profile, the organisation of the Group and
effectiveness of group-wide controls, changes in the business
environment and the potential impact of climate change and other
factors such as recent Internal audit results when assessing the level
of work to be performed at each component.
In assessing the risk of material misstatement to the consolidated
financial statements, and to ensure we had adequate quantitative
coverage of significant accounts in the consolidated financial
statements, of the 319 reporting components of the Group, we
selected 19 components covering entities within Germany, South
Africa, Italy, United Kingdom, Spain, Turkey, Greece, Egypt,
Luxembourg and corporate entities, which represent the principal
business units within the Group.
Of the 19 components selected, we performed an audit of the
complete financial information of nine components (“full scope
components”) which were selected based on their size or risk
characteristics.
For four components (“specific scope components”), we performed
full audit procedures on specific accounts within that component that
we considered had the potential for the greatest impact on the
significant accounts in the financial statements either because of the
size of these accounts or their risk profile. For the remaining six
components (“specified procedures components”), we performed
certain audit procedures on specific accounts within that component
that we considered had the potential for the greatest impact on the
significant accounts in the financial statements, either because of the
size of these accounts or their risk profile. Depending on the
component or type of procedures, these procedures were undertaken
by the primary audit team or a separate component audit team under
the primary audit team’s direction. The audit scope of these
components may not have included testing of all significant accounts
of the component, but will have contributed to the coverage of
significant accounts tested for the Group.
For the remaining components where we did not perform full audit
procedures, together these represent 28% of the Group’s Adjusted
EBITDAaL from continuing operations, and none generate more than
5% of the Group’s Adjusted EBITDAaL from continuing operations.
For these remaining components which are not full scope, specific
scope or specified procedures scope, we performed other procedures,
which may include analytical review at both the Group or individual
component levels and the use of customised data analytics tools over
the purchase to pay process, fixed assets balances and leases, to
profile trends and identify items for further investigation, inquiry of
management, testing entity level and group-wide controls and testing
of journals we deemed higher risk, across these remaining
components, in order to respond to identified potential risks of
material misstatement to the consolidated financial statements.
Independent auditor’s report to the members of Vodafone Group Plc (continued)
126
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Governance
Financials
Other information
The table below illustrates the coverage obtained from the work performed by our audit teams.
Reporting components
2024
Note
2023
Number
% of Group
Adjusted
EBITDAaL*
% of Group
Revenue
Number
% of Group Adjusted
EBITDAaL* % of Group Revenue
Full scope
9
72%
65%
1,2,3,6
9
74%
69%
Specific scope
4
–
–
4
4
–
–
Specified procedures
6
–
14%
3,5,7
6
–
11%
Full and specified procedures coverage
19
72%
79%
19
74%
80%
Remaining components
300
28%
21%
7,8,9
295
26%
20%
Total reporting components
319
100%
100%
314
100%
100%
1. Two of the nine full scope components relate to Vodafone Italy and Vodafone Spain, which were classified as discontinued operations in accordance with IFRS 5 during the year. As such, they do not
contribute to the Group’s Adjusted EBITDAaL or Group revenue from continuing operations.
2. Two further full scope components relate to the Company and another corporate entity whose activities include consolidation adjustments, which are audited by the primary audit team. Procedures
on three of the other full scope locations are undertaken by component audit teams based in Germany and the remaining two full scope components are South Africa and the UK.
3. The Group audit risks in relation to revenue recognition were subject to audit procedures at each of the full and specified procedures scope locations with significant revenue streams (being seven full
scope components and three specified procedures components).
4. The primary audit team performed full audit procedures on specific accounts in respect of four finance and corporate entities across a range of significant accounts. The audit procedures did not
include testing of all significant accounts of the components, but will have contributed to the coverage of significant accounts selected for testing by the primary audit team.
5. Specified procedures were performed over six entities across a range of significant accounts with three of these performed by component teams in Turkey, Egypt and Greece and the rest by the
primary audit team. The audit procedures did not include testing of all significant accounts of the components, but will have contributed to the coverage of significant accounts selected for testing by
the primary audit team.
6. The Group audit risks in relation to ‘Carrying value of cash generating units, including goodwill’ and ‘Recognition and recoverability of deferred tax assets on tax losses – Luxembourg’ were subject to
audit procedures by the primary audit team on the entire balance, with support from component audit teams on certain procedures.
7. The contribution of specified procedures components to Group Adjusted EBITDAaL is included within ‘remaining components’, as audit procedures were performed on certain, but not all, significant
accounts of the specified procedures components contributing to Group Adjusted EBITDAaL.
8. Included within the Group’s reporting components are the Group’s joint venture investments and associate investments, which are detailed in Note 12 of the consolidated financial statements, which
were subject to other procedures.
9. Changes in the number of remaining components compared to prior year reflect increases in the number of entities within the Group’s consolidation system.
*
Adjusted EBITDAaL as defined in ‘Our application of materiality’ section of this report and is based on continuing operations only. This metric has the same definition as the Group’s Adjusted EBITDAaL
Non-GAAP measure defined on page 236 of the Annual Report.
Changes from the prior year
The approach to audit scoping is similar to the prior year audit, with
the rotation of markets, designated as specified procedures scope for
selected significant accounts, to extend the Group audit procedures
beyond the Group’s main markets and to introduce a level of
unpredictability through risk-based testing. This approach resulted in:
– specified procedures scope being assigned to the component in
Greece, which was not subject to direct audit procedures in the
prior year; and
– The component in Portugal being assessed as a ‘Remaining
component’ in the current year.
Involvement with component teams
In establishing our overall approach to the Group audit, we
determined the type of work that needed to be undertaken at each of
the components by us, as the primary audit team, or by component
auditors from other EY global network firms operating under our
instruction. Of the nine full scope components, audit procedures were
performed on two of these directly by the primary audit team with the
remaining seven being performed by component audit teams. For the
four specific scope components, the procedures were performed
directly by the primary audit team. For the six specified procedures
scope components, work was performed directly by the primary audit
team for three of these, with the remaining three being performed by
component audit teams. Where the work was performed by
component auditors, we determined the appropriate level of
involvement to enable us to determine that sufficient audit evidence
had been obtained as a basis for our opinion on the consolidated
financial statements as a whole.
Vodafone has centralised processes and controls over certain areas
within its Vodafone Intelligent Solutions (“VOIS”) finance shared
service centre locations. The primary audit team performs direct
oversight, review, and coordination of the EY audit teams at VOIS,
whose work includes centralised testing for certain controls and
accounts, including procedures on leases, fixed assets, intangible
assets, cash and centralised purchase to pay processes.
The primary audit team continued to follow a programme of planned
visits that has been designed to ensure that the Senior Statutory
Auditor visits key locations on a rotational basis. In the current year
the Senior Statutory Auditor and other team members visited
component teams in Germany, UK, Italy and South Africa. The Senior
Statutory Auditor, also remotely attended audit closing meetings with
component teams and management of all full scope locations. In
addition, visits were undertaken by members of the primary audit
team to the component teams in Spain, Greece, Turkey, Egypt and
VOIS India. These visits involved meetings with local management,
understanding the overall audit approach, including key issues and
response as well as reviewing key work papers on risk areas.
The primary audit team interacted regularly with the local EY full
scope and specified procedures component teams where appropriate,
during various stages of the audit, reviewed relevant working papers
and were responsible for the scope and direction of the Group audit
process. We maintained continuous and open dialogue with the
component audit teams, in addition to holding formal meetings to
ensure that we were fully aware of their progress and the results of
their procedures. Close meetings for full, specific, and specified audit
procedures components (excluding those performed by the primary
audit team) were held via video conference in April 2024 and were
attended by the Senior Statutory Auditor and/or other members of
the primary audit team. This, together with the additional procedures
performed at Group level, gave us appropriate evidence for our
opinion on the consolidated financial statements.
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Climate change
Stakeholders are increasingly interested in how climate change will
impact Vodafone Group Plc. The Group has determined that the most
significant future impacts from climate change on its operations will
be from its Planet activities and commitments set out on pages 38 to
42 and the material climate-related physical and transitional risks
explained on pages 64 to 69 in the required Task Force for Climate
related Financial Disclosures, both of which form part of the “Other
information,” rather than the audited consolidated financial
statements. Our procedures on these unaudited disclosures therefore
consisted solely of considering whether they are materially
inconsistent with the financial statements or our knowledge obtained
in the course of the audit or otherwise appear to be materially
misstated, in line with our responsibilities on “Other information”.
In planning and performing our audit we assessed the potential
impacts of climate change on the Group’s business and any
consequential material impact on its financial statements.
As explained in Note 1 Basis of Preparation to the consolidated
financial statements, environmental, regulatory and other factors
responsive to climate change risks are still developing, and are
outside of the Group’s control, and consequently financial statements
cannot capture all possible future outcomes as these are not yet
known. The degree of certainty of these changes may also mean that
they cannot be taken into account when determining asset and
liability valuations and the timing of future cash flows under the
requirements of UK adopted international accounting standards. The
significant accounting estimates and judgements assessed by
management to be potentially impacted by climate risks have been
described in Note 1 and with further disclosure in respect of the
impact on the Group’s long-range plans and deferred tax asset
recognition provided in Note 4 and Note 6 respectively.
Our audit effort in considering the impact of climate change on the
consolidated financial statements was focused on evaluating
management’s assessment of the impact of climate risk, physical and
transition, their climate commitments, the effects of material climate
risks disclosed on pages 64 to 69 and the significant judgements and
estimates disclosed in note 1, 4 and 6 and whether these have been
appropriately reflected in asset values and associated disclosures
where values are determined through modelling future cash flows,
being ‘Goodwill’, ‘Other intangible assets’ and ‘Deferred tax assets’,
and in the timing and nature of liabilities recognised, being ‘Asset
Retirement Obligations’. As part of this evaluation, we performed our
own risk assessment, supported by our climate change internal
specialists, to determine the risks of material misstatement in the
financial statements from climate change which needed to be
considered in our audit.
The findings from our procedures supported our evaluation and
challenge of the adequacy of climate change considerations in the
Directors’ assessment of going concern and viability and associated
disclosures.
Based on our work we have not identified the impact of climate
change on the financial statements to be a key audit matter or to
materially impact a key audit matter.
Independent auditor’s report to the members of Vodafone Group Plc (continued)
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Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the
current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These
matters included those which had the greatest effect on: the overall audit strategy, the allocation of resources in the audit; and directing the
efforts of the engagement team. These matters were addressed in the context of our audit of the financial statements as a whole, and in our
opinion thereon, and we do not provide a separate opinion on these matters.
Risk
Carrying value of cash generating units, including goodwill
As more fully described in Note 4 to the consolidated financial statements, in accordance with IAS 36 Impairment of Assets, the Group calculates
the value in use (‘VIU’) for cash generating units (‘CGUs’) to determine whether an adjustment to the carrying value of the CGU, and therefore,
goodwill, is required. As at 31 March 2024, the Group has recorded €24,956 million (FY23: €27,615 million) of goodwill, including €20,335 million
(FY23: €20,335 million) in respect of Germany.
The Group’s assessment of the VIU of its CGUs involves estimation about the future performance of the local market businesses. In particular, the
determination of the VIU for Germany was sensitive to the significant assumptions of projected adjusted EBITDAaL growth, projected capital
expenditure, the long-term growth rate, and the discount rate.
Auditing the Group’s annual impairment test for the Germany CGU was complex and involved significant auditor judgement, given the estimation
uncertainty related to the significant assumptions described above and the sensitivity to fluctuations in those assumptions, as well as market
specific factors.
Our response to the risk
The recoverability of the Group’s Germany CGU carrying value was subject to full scope audit procedures performed by the primary audit team
with support from the component audit team on certain procedures at the local market level.
We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Group’s goodwill impairment
review process, including, for example, management’s controls over the significant assumptions described for the Germany VIU assessment
above.
For the annual impairment assessment as at 31 March 2024, we also evaluated, with the help of EY valuation specialists, the methodology
applied in the Germany VIU model, as compared to the requirements of IAS 36, including the mathematical accuracy of management’s model.
We performed procedures to assess the significant assumptions used in the Germany VIU model, including:
– Evaluating projected adjusted EBITDAaL growth, for example by comparing underlying assumptions to external data, such as economic and
industry forecasts for the German and European markets, supporting evidence provided by management, and for consistency with evidence
obtained from other areas of our audit, including, for example, the results of our procedures described in ‘Recognition and recoverability of
deferred tax assets on tax losses – Luxembourg’ below;
– comparing the cash flow projections used in the Germany VIU model to the information approved by the Group’s Board of Directors and
evaluating the historical accuracy of management’s business plans, which underpin the VIU model, by comparing prior years’ forecasts to
actual results;
– comparing forecast capital expenditure to actual historical spend, market specific events such as fibre and 5G roll-out, industry analysis and
competitor data, where available;
– with the support of EY valuation specialists, comparing the long-term growth rate and discount rate assumptions to EY independently
determined ranges;
– performing sensitivity analyses on the above-described assumptions in the VIU model, to evaluate whether a reasonable change in
assumptions would cause an impairment of the Germany CGU or indicate additional disclosures were appropriate; and
– in considering the existence of contrary evidence, for management’s assessment of implied recoverable value, we compared the Germany
CGU EBITDAaL multiple to market listed peers and considered independent analyst valuations for the Germany CGU, where available.
We also assessed the adequacy of the related disclosures provided in Note 4 of the consolidated financial statements, in particular the sensitivity
disclosures in relation to reasonably possible changes in assumptions that could result in impairment.
Key observations communicated to the Audit and Risk Committee
We agree with management’s conclusion that no impairment charge is required to be recognised in the year in respect of the Germany CGU.
The disclosures in Note 4 of the consolidated financial statements in respect of the Germany CGU are consistent with the requirements of IAS 36
including the sensitivity disclosures, which reflect those changes in certain key assumptions that would eliminate the headroom of €2.3 billion.
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Risk
Recognition and recoverability of deferred tax assets on tax losses – Luxembourg
As more fully described in Note 6 to the consolidated financial statements, the Group recognises deferred tax assets in accordance with IAS 12
Income Taxes, based on whether management judges that it is probable that there will be sufficient taxable profits in the relevant legal entity or
tax group to allow the recognised asset to be recovered.
A deferred tax asset in Luxembourg of €16,714 million (FY23: €16,269 million) has been recognised in respect of losses, as management
concluded it is probable that the Luxembourg entities will continue to generate taxable profits in the future against which the deferred tax asset
will be recovered. Management estimates that the losses will be utilised, and the related deferred tax asset recovered, over a period of 52 to 57
years (FY23: 35 to 39 years).
The Luxembourg companies’ income is derived from the Group’s internal financing, procurement and roaming activities. The forecast future
finance income can vary based on forecast interest rates and intercompany debt levels, in particular with Vodafone Germany, which in turn
impacts the timeframe over which the deferred tax asset is forecast to be recovered.
Furthermore, during the course of the year, the group recognised an additional €1,019 million (included within the €16,714 million above) of
deferred tax assets in Luxembourg, in respect of losses that were not previously recognised, on the basis that it is now considered more likely
than not that the related €4 billion of losses would not be successfully challenged by the European Commission under state aid rules.
Auditing the Group’s recognition and recoverability of deferred tax assets in Luxembourg is significant to the audit because it involves material
amounts, and the judgements and estimates in relation to future taxable profits and the period of time over which it is expected to utilise these
assets, results in increased estimation uncertainty.
Our response to the risk
Audit procedures on the recognition and recoverability of deferred tax assets on tax losses in Luxembourg were performed by the primary audit
team and its tax professionals, with support from Luxembourg tax and transfer pricing specialists for certain procedures.
We obtained an understanding and evaluated the design effectiveness of management’s controls around the recognition and recoverability of
deferred tax assets in Luxembourg, including the calculation of the gross amount of deferred tax assets recorded and the preparation of the
prospective financial information used to determine the Luxembourg entities’ future taxable income.
To test the recognition and recoverability of the deferred tax assets in Luxembourg, with the support of tax professionals and tax specialists, our
audit procedures included, among others;
– assessing the existence of available losses and evaluating management’s position on the recoverability of the losses with respect to local tax
law and tax planning strategies adopted;
– in respect of the additional €1,019 million deferred tax asset recognised in the year, we reviewed the legal advice obtained by management
and met with the Group’s external legal counsel to consider their interpretation of recent legal rulings in respect of recent European
Commission state aid cases in Luxembourg and their application to the Group;
– evaluating the forecast finance income by, on a sample basis, recalculating income with reference to underlying agreements, comparing
future interest rates utilised in the forecasts to relevant external benchmarks and the assumed projections in intra-group debt levels for
consistency with our understanding of relevant guidance in respect of transfer pricing of financial transactions;
– assessing whether contrary evidence exists that is not consistent with either management’s stated intention that the financing structures, as
projected, as well as the debt levels in Vodafone Germany, will remain in place or that it is probable that sufficient future taxable profits will
exist;
– assessing the reasonability of forecasted procurement and roaming taxable profits utilised in management’s assessment, by considering
historical forecasting accuracy, changes in pricing models, and with evidence obtained from other areas of our audit;
– performing sensitivities to understand the impact of changes in key assumptions of intra-group financing levels and forecast interest rates, on
the utilisation timeframe given the Group does not currently recognise deferred tax assets which are forecast to be used 60 years beyond the
balance sheet date; and
– evaluating the adequacy of the disclosures in respect of the recognition of the deferred tax asset, including as it relates to the evidence
supporting the recognition, judgements in respect of the utilisation profile, including longer term uncertainties and the key drivers of changes
in the carrying value of the asset and the utilisation period.
Key observations communicated to the Audit and Risk Committee
We agree with the recognition of the deferred tax assets and consequently the long recoverability period, on the basis of forecast profits, which are
considered probable, given the commercial rationale and management’s intention to retain current activities in Luxembourg and the debt levels in
Vodafone Germany, over the longer term, and the track record of historical profitability in the Luxembourg operations.
The increase in the period of utilisation in FY24 is consistent with expectations of future interest rate reductions, driving lower forecast taxable profits
on forecast financing activities.
Changes in key assumptions, in particular a plausible reduction in the level of intra-group debt levels with Germany, could lead to an increase in
utilisation period beyond 60 years. The Group does not currently recognise deferred tax assets which are forecast to be used 60 years beyond the
balance sheet date and consequently, should the assumptions change, a different conclusion could be reached in respect of the level of deferred tax
asset recognised.
We consider that the disclosures included within Note 6 to the consolidated financial statements acknowledges both the judgement made in respect
of the timing and profile of the utilisation of the losses in the short to medium term and the longer-term uncertainties in relation to the carrying value
of the related deferred tax asset.
Independent auditor’s report to the members of Vodafone Group Plc (continued)
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Risk
Revenue recognition
As more fully described in Note 2, Note 14 and Note 15 to the consolidated financial statements, the Group reported revenue of €36,717 million
(FY23: €37,672 million, after re-presentation for IFRS 5, contract assets of €2,863 million (FY23: €3,557 million) and contract liabilities of €1,908
million (FY23: €2,543 million) for the year ended or as at 31 March 2024. Management records revenue according to the principles of IFRS 15,
Revenue from Contracts with Customers, including following the 5-step model therein.
We identified a risk of management override through inappropriate manual topside revenue journal entries, given revenue is a key performance
indicator, both in external communication and for management incentives.
We also consider auditing the revenue recorded by the Group to involve greater auditor effort and attention, due to the multiple IT systems and
tools utilised in the initiation, processing and recording of transactions, which includes a high volume of individually low monetary value
transactions. The involvement of IT professionals was required to determine the audit approach to test and evaluate the relevant data that was
captured and aggregated, and to assess the sufficiency of the audit evidence obtained.
Our response to the risk
We performed full or specified audit procedures over this risk area in 7 full scope and 3 specified procedure components with significant revenue
streams, which covered 79% of the Group’s revenue.
Our audit procedures at full scope component locations included, among others obtaining an understanding of, evaluating the design and
testing the operating effectiveness of controls over the Group’s revenue recognition process, which includes management’s determination of the
timing of revenue recorded. With the support of our IT professionals, we also evaluated the design and tested the operating effectiveness of
controls over the appropriate flow of transactional data through the IT systems and tools and the reconciliation of the transactional data to the
accounting records. For specified procedures components, we obtained an understanding of the design of controls over the revenue recognition
process.
For significant revenue streams, our audit procedures included the following, on a sample basis:
– We used data analytic tools to identify revenue related manual journals posted to the general ledger and traced these back to underlying
source documentation, to evaluate the propriety, completeness and accuracy of the postings. We also performed analytical procedures to
consider the completeness of journal postings.
– Where it was deemed to be most effective, at certain components we extended the use of data analytics. These incremental procedures
involved testing full populations of transactions, including performing a correlation analysis between invoiced revenue, receivables and cash.
We performed targeted audit procedures over material items that did not correlate as expected.
– At components where the above procedures were not used, for the significant revenue billing systems, we obtained the billing data to general
ledger reconciliation, which included the relevant adjustments to deferred and accrued revenue balances. We reperformed these
reconciliations, including assessing the accuracy of the data inputs to underlying source documentation, including contractual agreements
where applicable. In addition, we tested the mathematical accuracy and completeness of the reconciliations and material reconciling items,
including significant revenue postings outside of the billing systems.
– We recalculated the revenue recognised to evaluate whether the processing of the revenue recognition by the Group’s IT systems was
materially correct.
We also assessed the adequacy of the Group’s disclosures in respect to the accounting policies on revenue recognition.
Key observations communicated to the Audit and Risk Committee
Based on the procedures performed, including those in respect of manual adjustments to revenue, we concluded that revenue has been
appropriately recognised in accordance with IFRS 15, in the year ended 31 March 2024.
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Our application of materiality
We apply the concept of materiality in planning and performing the
audit, in evaluating the effect of identified misstatements on the audit
and in forming our audit opinion.
Materiality
The magnitude of an omission or misstatement that, individually or in
the aggregate, could reasonably be expected to influence the
economic decisions of the users of the financial statements.
Materiality provides a basis for determining the nature and extent of
our audit procedures.
We determined our final materiality for the Group to be €220 million
(2023: €300 million), which is 2% (2023: approximately 2%) of
Adjusted EBITDAaL. We believe that Adjusted EBITDAaL provides us
with the most relevant performance measure for the continuing
business on which to determine materiality, given the prominence of
this metric throughout the Annual Report and consolidated financial
statements, investor presentations, profit metrics focused on by
analysts and its alignment to the management remuneration metric
of adjusted EBIT.
We determined materiality for the Parent company to be €450 million
(2023: €502 million), which is 1% (2023: 1%) of the Parent company’s
equity. However, since the Parent company was a full scope
component, for accounts that were relevant for the consolidated
financial statements, a performance materiality of €33 million was
applied.
During the course of our audit, we reassessed initial Group materiality
(€260 million) after the classification of Vodafone Spain and Italy as
discontinued operations, in accordance with IFRS 5. We did not
change our basis or point in range as 2% of Adjusted EBITDAaL from
continuing operations, remained the most relevant performance
metric. Our audit procedures have been performed to our final
materiality (€220 million).
Performance materiality
The application of materiality at the individual account or balance
level. It is set at an amount to reduce to an appropriately low level the
probability that the aggregate of uncorrected and undetected
misstatements exceeds materiality.
On the basis of our risk assessments, together with our assessment of
the effectiveness of the Group’s overall control environment to
prevent or timely detect and correct material errors, our judgement
was that performance materiality was 75% (2023: 75%) of our
planning materiality, namely €165m (2023: €225m).
Audit work at component locations for the purpose of obtaining audit
coverage over significant financial statement accounts is undertaken
based on a percentage of total performance materiality. The
performance materiality set for each component is based on the
relative scale and risk of the component to the Group as a whole and
our assessment of the risk of misstatement at that component. In the
current year, the range of performance materiality allocated to
components was €33m to €165m (2023: €45m to €225m).
Reporting threshold
An amount below which identified misstatements are considered as
being clearly trivial.
We agreed with the Audit and Risk Committee that we would report
to them all uncorrected audit differences in excess of €11m (2023:
€15m), which is set at 5% of materiality, as well as differences below
that threshold that, in our view, warranted reporting on qualitative
grounds.
We evaluate any uncorrected misstatements against both the
quantitative measures of materiality discussed above and in light of
other relevant qualitative considerations in forming our opinion.
Other information
The other information comprises the information included in the
annual report set out on pages 1 to 124, other than the financial
statements and our auditor’s report thereon. The directors are
responsible for the other information contained within the annual
report.
Our opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated in this
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with
the financial statements or our knowledge obtained in the course of
the audit or otherwise appears to be materially misstated. If we
identify such material inconsistencies or apparent material
misstatements, we are required to determine whether this gives rise
to a material misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that there is a
material misstatement of the other information, we are required to
report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the
Companies Act 2006
In our opinion, the part of the directors’ remuneration report to be
audited has been properly prepared in accordance with the
Companies Act 2006.
In our opinion, based on the work undertaken in the course of the
audit:
– the information given in the strategic report and the directors’
report for the financial year for which the financial statements are
prepared is consistent with the financial statements; and
– the strategic report and the directors’ report have been prepared in
accordance with applicable legal requirements.
Independent auditor’s report to the members of Vodafone Group Plc (continued)
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Matters on which we are required to report by
exception
In the light of the knowledge and understanding of the Group and the
Parent company and its environment obtained in the course of the
audit, we have not identified material misstatements in the strategic
report or the directors’ report.
We have nothing to report in respect of the following matters in
relation to which the Companies Act 2006 requires us to report to
you if, in our opinion:
– adequate accounting records have not been kept by the Parent
company, or returns adequate for our audit have not been received
from branches not visited by us; or
– the Parent company financial statements and the part of the
Directors’ Remuneration Report to be audited are not in agreement
with the accounting records and returns; or
– certain disclosures of directors’ remuneration specified by law are
not made; or
– we have not received all the information and explanations we
require for our audit
Corporate Governance Statement
We have reviewed the directors’ statement in relation to going
concern, longer-term viability and that part of the Corporate
Governance Statement relating to the Group and Parent company’s
compliance with the provisions of the UK Corporate Governance
Code specified for our review by the Listing Rules.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements or our knowledge obtained during the audit:
– Directors’ statement with regards to the appropriateness of
adopting the going concern basis of accounting and any material
uncertainties identified set out on page 124;
– Directors’ explanation as to its assessment of the company’s
prospects, the period this assessment covers and why the period is
appropriate set out on page 63;
– Director’s statement on whether it has a reasonable expectation
that the Group will be able to continue in operation and meets its
liabilities set out on page 63;
– Directors’ statement on fair, balanced and understandable set out
on page 123;
– Board’s confirmation that it has carried out a robust assessment of
the emerging and principal risks set out on page 123;
– The section of the annual report that describes the review of
effectiveness of risk management and internal control systems set
out on pages 93 and 120; and;
– The section describing the work of the Audit & Risk Committee set
out on pages 89 to 94
Responsibilities of directors
As explained more fully in the directors’ responsibilities statement set
out on page 123, the directors are responsible for the preparation of
the financial statements and for being satisfied that they give a true
and fair view, and for such internal control as the directors determine
is necessary to enable the preparation of financial statements that are
free from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for
assessing the Group and Parent company’s ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
directors either intend to liquidate the Group or the Parent company
or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the
financial statements
Our objectives are to obtain reasonable assurance about whether the
financial statements as a whole are free from material misstatement,
whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of
assurance, but is not a guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material misstatement
when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
Explanation as to what extent the audit was
considered capable of detecting irregularities,
including fraud
Irregularities, including fraud, are instances of non-compliance with
laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect irregularities, including
fraud. The risk of not detecting a material misstatement due to fraud
is higher than the risk of not detecting one resulting from error, as
fraud may involve deliberate concealment by, for example, forgery or
intentional misrepresentations, or through collusion. The extent to
which our procedures are capable of detecting irregularities, including
fraud is detailed below.
However, the primary responsibility for the prevention and detection
of fraud rests with both those charged with governance of the
company and management.
– We obtained an understanding of the legal and regulatory
frameworks that are applicable to the Group and determined that
the most significant are those that relate to the reporting
framework (IFRS as Issued by the International Accounting
Standards Board, Financial Reporting Standard 101 ‘Reduced
disclosure framework’, (‘FRS 101’), the UK Companies Act 2006 and
UK Corporate Governance Code), the relevant tax compliance
regulations in the jurisdictions in which the Group operates and the
EU General Data Protection Regulation (GDPR).
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– We understood how the Group is complying with those frameworks
by making enquiries of management, internal audit, those
responsible for legal and compliance procedures and the Company
Secretary. We supplemented our enquiries through our review of
board minutes and papers provided to the Audit and Risk
Committee, correspondence received from regulatory bodies and
attendance at all meetings of the Audit and Risk Committee, as
well as consideration of the results of our audit procedures across
the Group, including our testing of entity level and group-wide
controls.
– We assessed the susceptibility of the Group’s financial statements
to material misstatement, including how fraud might occur, by
meeting with management from various parts of the Group,
including management and finance teams of the local markets
designated as full, specific and specified procedures scope
locations, Head Office, the Audit and Risk Committee, the Group
Internal Audit function, the Group Legal function and individuals in
the fraud and compliance department, to understand where it
considered there was susceptibility to fraud; and assessing
whistleblowing logs and associated incidences for those with a
potential financial reporting impact. We also considered
performance targets and their propensity to influence efforts made
by management to manage earnings or influence the perceptions
of analysts. We considered the programmes and controls that the
Group has established to address risks identified, or that otherwise
prevent, deter and detect fraud, and how senior management
monitors those programmes and controls.
– Based on this understanding we designed our audit procedures to
identify non-compliance with such laws and regulations or
fraudulent financial reporting, where the impact on the financial
statements of such non-compliance or fraudulent financial
reporting could be material. These procedures included, where
necessary, the use of forensic and other relevant specialists. Our
procedures involved enquiries of management at Head Office, the
Audit and Risk Committee, the Group Internal Audit function, the
Group legal function, the Group Corporate Security team,
individuals in the fraud and compliance department (including
those responsible for fraud investigation and whistleblowing). We
also performed journal entry testing, with a focus on manual
consolidation journals, journals indicating large or unusual
transactions and journals with key words that could indicate
management override, based on our understanding of the business;
and challenging the assumptions and judgements made by
management in respect of significant one-off transactions in the
financial year and significant accounting estimates, as referred to in
the key audit matters section above. At a component level, our full
and specified procedure scope component audit teams’
procedures included enquiries of component management; journal
entry testing; and testing in respect of the key audit matter of
revenue recognition. We also leveraged our data analytics
capabilities in performing work on the purchase to pay process and
fixed asset balances and leases, to assist in identifying higher risk
transactions and balances, for testing. We also used EY’s Document
Authenticity Tool to analyse certain electronic documents used as
audit evidence, to identify characteristics of documents that can be
indicators of alteration or inauthenticity.
– Where the risk of fraud, including the risk of management override,
was considered to be higher, including areas impacting Group key
performance indicators or management remuneration, we
performed audit procedures to address each identified material
fraud risk or other risk of material misstatement. These procedures
included those on revenue recognition referred to in the key audit
matters section above and testing journal entries that we judged to
be of higher risk and were designed to provide reasonable
assurance that the financial statements were free from material
fraud or error.
A further description of our responsibilities for the audit of the
financial statements is located on the Financial Reporting Council’s
website at https://www.frc.org.uk/auditorsresponsibilities. This
description forms part of our auditor’s report.
Other matters we are required to address
– Following the recommendation from the Audit & Risk Committee,
we were appointed by the Parent company on 9 May 2023 to audit
the financial statements for the year ending 31 March 2023 and
subsequent financial periods.
– The period of total uninterrupted engagement including previous
renewals and reappointments is five years, covering the years
ending 31 March 2020 to 31 March 2024.
– The audit opinion is consistent with the additional report to the
Audit & Risk Committee.
Use of our report
This report is made solely to the company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the
company’s members those matters we are required to state to them
in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the company and the company’s members as a
body, for our audit work, for this report, or for the opinions we have
formed.
Alison Duncan (Senior statutory auditor)
for and on behalf of Ernst & Young LLP, Statutory Auditor
London
14 May 2024
Independent auditor’s report to the members of Vodafone Group Plc (continued)
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Consolidated income statement
for the years ended 31 March
Re-presented1
Re-presented1
2024
2023
2022
Note
€m
€m
€m
Revenue
2
36,717
37,672
37,010
Cost of sales
(24,459)
(24,359)
(23,948)
Gross profit
12,258
13,313
13,062
Selling and distribution expenses
(2,674)
(2,777)
(2,754)
Administrative expenses
(5,768)
(5,351)
(4,797)
Net credit losses on financial assets
22
(491)
(505)
(404)
Share of results of equity accounted associates and joint ventures
12
(96)
433
389
Impairment reversal/(loss)
4
64
(64)
–
Other income
3
372
9,402
244
Operating profit
3
3,665
14,451
5,740
Investment income
5
581
232
251
Financing costs
5
(2,626)
(1,609)
(1,842)
Profit before taxation
1,620
13,074
4,149
Income tax expense
6
(50)
(492)
(1,561)
Profit for the financial year - Continuing operations
1,570
12,582
2,588
(Loss)/profit for the financial year - Discontinued operations
7
(65)
(247)
185
Profit for the financial year
1,505
12,335
2,773
Attributable to:
– Owners of the parent
1,140
11,838
2,237
– Non-controlling interests2
365
497
536
Profit for the financial year
1,505
12,335
2,773
Earnings per share - Continuing operations
– Basic
8
4.45c
43.66c
7.07c
– Diluted
8
4.44c
43.51c
7.05c
Earnings per share - Total Group
– Basic
8
4.21c
42.77c
7.71c
– Diluted
8
4.20c
42.62c
7.68c
Consolidated statement of comprehensive income/(expense)
for the years ended 31 March
Re-presented1
Re-presented1
2024
2023
2022
Note
€m
€m
€m
Profit for the financial year
1,505
12,335
2,773
Other comprehensive income/(expense):
Items that may be reclassified to the income statement in subsequent years:
Foreign exchange translation differences, net of tax
(440)
(1,236)
(30)
Foreign exchange translation differences transferred to the income statement
23
(334)
19
Other, net of tax3
(1,748)
963
1,863
Total items that may be reclassified to the income statement in subsequent years
(2,165)
(607)
1,852
Items that will not be reclassified to the income statement in subsequent years:
Net actuarial (losses)/gains on defined benefit pension schemes, net of tax
25
(58)
(160)
483
Total items that will not be reclassified to the income statement in subsequent
years
(58)
(160)
483
Other comprehensive (expense)/income
(2,223)
(767)
2,335
Total comprehensive (expense)/income for the financial year
(718)
11,568
5,108
Attributable to:
– Owners of the parent
(920)
11,267
4,546
– Non-controlling interests
202
301
562
Total comprehensive (expense)/income for the financial year
(718)
11,568
5,108
Notes:
1
The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note 7
‘Discontinued operations and assets held for sale’ for more information.
2
Profit attributable to non-controlling interests derives solely from continuing operations.
3
Principally includes the impact of the Group’s cash flow hedges deferred to other comprehensive income during the year.
Further details on items in the consolidated statement of comprehensive income/(expense) can be found in the consolidated statement of changes in equity on page
137.
136
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Consolidated statement of financial position
at 31 March
31 March 2024
31 March 2023
Note
€m
€m
Non-current assets
Goodwill
10
24,956
27,615
Other intangible assets
10
13,896
19,592
Property, plant and equipment
11
28,499
37,992
Investments in associates and joint ventures
12
10,032
11,079
Other investments
13
1,006
1,093
Deferred tax assets
6
20,177
19,316
Post employment benefits
25
257
329
Trade and other receivables
14
5,967
7,843
104,790
124,859
Current assets
Inventory
568
956
Taxation recoverable
76
279
Trade and other receivables
14
8,594
10,705
Other investments
13
5,092
7,017
Cash and cash equivalents
19
6,183
11,705
20,513
30,662
Assets held for sale
7
19,047
–
Total assets
144,350
155,521
Equity
Called up share capital
17
4,797
4,797
Additional paid-in capital
149,253
149,145
Treasury shares
(7,645)
(7,719)
Accumulated losses
(114,641)
(113,086)
Accumulated other comprehensive income
28,202
30,262
Total attributable to owners of the parent
59,966
63,399
Non-controlling interests
1,032
1,084
Total equity
60,998
64,483
Non-current liabilities
Borrowings
21
48,328
51,669
Deferred tax liabilities
6
699
771
Post employment benefits
25
181
258
Provisions
16
1,615
1,572
Trade and other payables
15
2,328
2,184
53,151
56,454
Current liabilities
Borrowings
21
8,659
14,721
Financial liabilities under put option arrangements
22
–
485
Taxation liabilities
393
457
Provisions
16
833
674
Trade and other payables
15
13,398
18,247
23,283
34,584
Liabilities held for sale
7
6,918
–
Total equity and liabilities
144,350
155,521
The consolidated financial statements on pages 135 to 226 were approved by the Board of Directors and authorised for issue on 14 May 2024 and
were signed on its behalf by:
Margherita Della Valle
Luka Mucic
Group Chief Executive
Group Chief Financial Officer
137
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Consolidated statement of changes in equity
for the years ended 31 March
Additional
Accumulated other comprehensive income
Equity
Non-
Share
paid-in
Treasury
Accumulated
Currency
Pensions Revaluation
attributable
controlling
Total
capital1
capital2
shares
losses
reserve3
reserve
surplus4
Other5
to owners
interests
equity
€m
€m
€m
€m
€m
€m
€m
€m
€m
€m
€m
1 April 2021
4,797
150,812
(6,172)
(121,640) 28,430
(1,234) 1,227
(464) 55,756
2,012
57,768
Issue or reissue of shares6
–
(1,902)
2,000
(98)
–
–
–
–
–
–
–
Share-based payments
–
108
–
–
–
–
–
–
108
11
119
Transactions with NCI in
subsidiaries7
–
–
–
(38)
–
–
–
–
(38)
237
199
Dividends
–
–
–
(2,483)
–
–
–
–
(2,483)
(532)
(3,015)
Comprehensive
income/(expense)
–
–
–
2,237
(37)
483
–
1,863
4,546
562
5,108
Profit
–
–
–
2,237
–
–
–
–
2,237
536
2,773
OCI - before tax
–
–
–
–
(56)
627
–
2,368
2,939
26
2,965
OCI - taxes
–
–
–
–
–
(144)
–
(505)
(649)
–
(649)
Transfer to the income
statement ('IS')
–
–
–
–
19
–
–
–
19
–
19
Purchase of treasury
shares ('TS')8
–
–
(3,106)
–
–
–
–
–
(3,106)
–
(3,106)
31 March 2022
4,797
149,018
(7,278)
(122,022) 28,393
(751) 1,227
1,399
54,783
2,290
57,073
Adoption of IAS 29
–
–
–
–
565
–
–
–
565
–
565
1 April 2022 - b/forward
4,797
149,018
(7,278)
(122,022) 28,958
(751) 1,227
1,399
55,348
2,290
57,638
Issue or reissue of shares
–
1
122
(113)
–
–
–
–
10
–
10
Share-based payments
–
126
–
–
–
–
–
–
126
9
135
Transactions with NCI in
subsidiaries
–
–
–
(287)
–
–
–
–
(287)
(1,118)
(1,405)
Dividends
–
–
–
(2,502)
–
–
–
–
(2,502)
(398)
(2,900)
Comprehensive
income/(expense)
–
–
–
11,838
(1,374)
(160)
–
963
11,267
301
11,568
Profit9
–
–
–
11,838
–
–
–
–
11,838
497
12,335
OCI - before tax
–
–
–
–
(1,469)
(213)
–
1,314
(368)
(230)
(598)
OCI - taxes
–
–
–
–
(3)
53
–
(351)
(301)
(3)
(304)
Transfer to the IS
–
–
–
–
(334)
–
–
–
(334)
–
(334)
Translation of
hyperinflationary results
–
–
–
–
432
–
–
–
432
37
469
Purchase of TS8
–
–
(563)
–
–
–
–
–
(563)
–
(563)
31 March 2023
4,797
149,145
(7,719)
(113,086) 27,584
(911) 1,227
2,362
63,399
1,084
64,483
Issue or reissue of shares
–
–
74
(72)
–
–
–
–
2
–
2
Share-based payments
–
108
–
–
–
–
–
–
108
7
115
Transactions with NCI in
subsidiaries
–
–
–
(26)
–
–
–
–
(26)
(5)
(31)
Share of equity accounted
entities change in equity
–
–
–
(164)
–
–
–
–
(164)
–
(164)
Dividends
–
–
–
(2,433)
–
–
–
–
(2,433)
(256)
(2,689)
Comprehensive
(expense)/income
–
–
–
1,140
(254)
(58)
–
(1,748)
(920)
202
(718)
Profit
–
–
–
1,140
–
–
–
–
1,140
365
1,505
OCI - before tax
–
–
–
–
(826)
(77)
–
(2,331)
(3,234)
(192)
(3,426)
OCI - taxes
–
–
–
–
–
19
–
583
602
–
602
Transfer to the IS
–
–
–
–
23
–
–
–
23
–
23
Translation of
hyperinflationary results
–
–
–
–
549
–
–
–
549
29
578
31 March 2024
4,797
149,253
(7,645)
(114,641) 27,330
(969) 1,227
614
59,966
1,032
60,998
Notes:
1
See note 17 ‘Called up share capital’.
2
Includes share premium, capital reserve, capital redemption reserve, merger reserve and share-based payment reserve. The merger reserve was derived from acquisitions made prior to 31 March 2004 and subsequently
allocated to additional paid-in capital on adoption of IFRS.
3
The currency reserve is used to record cumulative translation differences on the assets and liabilities of foreign operations. These differences are recycled to the income statement on disposal of the foreign operation.
4
The revaluation surplus derives from acquisitions of subsidiaries made before the Group’s adoption of IFRS 3 (Revised) on 1 April 2010 and comprises the amounts arising from recognising the Group’s pre-existing equity
interest in the acquired subsidiary at fair value.
5
Principally includes the impact of the Group’s cash flow hedges with €2,037 million net loss deferred to other comprehensive income/(expense) during the year (2023: €2,322 million net gain; 2022: €3,704 million net gain)
and €254 million net gain (2023: €896 million net gain; 2022: €1,422 million net gain) recycled to the consolidated income statement. These hedges primarily relate to foreign exchange exposure on fixed borrowings, with
any foreign exchange on nominal balances directly impacting income statement in each period but interest cash flows unwinding to the consolidated income statement over the life of the hedges, up to 2063. See note 22
‘Capital and financial risk management’.
6
Movements include the re-issue of 1,519 million shares (€1,903 million) in March 2022 to satisfy the second tranche of the Mandatory Convertible Bond issued in March 2019.
7
Principally relates to transactions in relation to Vantage Towers A.G. See note 27 ‘Acquisitions and disposals’ for details.
8
Represents the irrevocable and non-discretionary share buyback programmes which completed on 15 March 2023.
9
Includes a gain on disposal of Vantage Towers A.G. of €8,607 million and a gain on disposal of Vodafone Ghana of €689 million, offset by a loss on disposal of Vodafone Hungary of €69 million.
138
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Consolidated statement of cash flows
for the years ended 31 March
Re-presented1
Re-presented1
2024
2023
2022
Note
€m
€m
€m
Inflow from operating activities
18
16,557
18,054
18,081
Cash flows from investing activities
Purchase of interests in associates and joint ventures
12
(75)
(78)
(445)
Purchase of intangible assets
(2,641)
(2,799)
(2,375)
Purchase of property, plant and equipment
(4,219)
(4,957)
(4,547)
Purchase of investments
(1,233)
(766)
(2,007)
Disposal of interests in subsidiaries, net of cash disposed
27
(67)
6,976
–
Disposal of interests in associates and joint ventures
500
–
446
Disposal of property, plant and equipment and intangible assets
15
90
15
Disposal of investments
1,931
1,647
3,280
Dividends received from associates and joint ventures
442
617
638
Interest received
542
321
246
Cash outflows from discontinued operations
(1,317)
(1,430)
(2,119)
Outflow from investing activities
(6,122)
(379)
(6,868)
Cash flows from financing activities
Proceeds from issue of long-term borrowings
1,533
4,071
2,548
Repayment of borrowings
(8,970)
(10,501)
(6,933)
Net movement in short-term borrowings
(1,636)
3,171
3,002
Net movement in derivatives
144
261
(293)
Interest paid2
(2,227)
(1,815)
(1,726)
Payments for settlement of written put options
(493)
(12)
–
Purchase of treasury shares
–
(1,867)
(2,087)
Issue of ordinary share capital and reissue of treasury shares
17
3
10
–
Equity dividends paid
9
(2,430)
(2,484)
(2,474)
Dividends paid to non-controlling shareholders in subsidiaries
(260)
(400)
(539)
Other transactions with non-controlling shareholders in subsidiaries
27
(16)
(692)
189
Cash outflows from discontinued operations
(1,503)
(3,172)
(1,393)
Outflow from financing activities
(15,855)
(13,430)
(9,706)
Net cash (outflow)/inflow
(5,420)
4,245
1,507
Cash and cash equivalents at beginning of the financial year
19
11,628
7,371
5,790
Exchange (loss)/gain on cash and cash equivalents
(94)
12
74
Cash and cash equivalents at end of the financial year
19
6,114
11,628
7,371
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note 7
‘Discontinued operations and assets held for sale’ for more information.
2 Amount for 2024 includes €nil (2023: €26 million cash outflow; 2022: €58 million cash inflow) on derivative financial instruments for the share buyback related to maturing tranches of mandatory convertible bonds.
139
Vodafone Group Plc
Annual Report 2024
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Governance
Financials
Other information
Notes to the consolidated financial statements
1. Basis of preparation
This section describes the critical accounting judgements and estimates that management has identified as having a
potentially material impact on the Group’s consolidated financial statements and sets out our significant accounting
policies that relate to the financial statements as a whole. Where an accounting policy is generally applicable to a
specific note to the financial statements, the policy is described within that note. We have also detailed below the new
accounting pronouncements that we will adopt in future years and our current view of the impact they will have on our
financial reporting.
The consolidated financial statements are prepared in accordance with UK-adopted International Accounting Standards (‘IAS’), with International
Financial Reporting Standards (‘IFRS’) as issued by the International Accounting Standards Board (‘IASB’) and with the requirements of the
Companies Act 2006 (the ‘Act’). The consolidated financial statements are prepared on a going concern basis (see page 124).
Vodafone Group Plc is incorporated and domiciled in England and Wales (registration number 1833679). The registered address of the Company is
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, England.
IFRS requires the Directors to adopt accounting policies that are the most appropriate to the Group’s circumstances. These have been applied
consistently to all the years presented, unless otherwise stated. In determining and applying accounting policies, Directors and management are
required to make judgements and estimates in respect of items where the choice of specific policy, accounting judgement, estimate or assumption
to be followed could materially affect the Group’s reported financial position, results or cash flows and disclosure of contingent assets or liabilities
during the reporting period; it may later be determined that a different choice may have been more appropriate.
The Group’s critical accounting judgements and key sources of estimation uncertainty are detailed below. Actual outcomes could differ from those
estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised if the revision affects only that period; they are recognised in the period of the revision and future periods if
the revision affects both current and future periods.
Management regularly reviews, and revises as necessary, the accounting judgements that significantly impact the amounts recognised in the
financial statements and the estimates that are considered to be ‘critical estimates’ due to their potential to give rise to material adjustments in the
Group’s financial statements in the year to 31 March 2025. As at 31 March 2024, management has identified critical judgements in respect of
revenue recognition, lease accounting, the recognition of deferred tax assets, the accounting for tax disputes, valuing assets and liabilities acquired
in business combinations, the classification of joint arrangements, whether to recognise provisions or to disclose contingent liabilities, held for sale
accounting and the impacts of climate change. In addition, management has identified critical accounting estimates in relation to the recovery of
deferred tax assets, post employment benefits and impairment reviews; estimates have also been identified that are not considered to be critical in
respect of the allocation of revenue to goods and services, the useful economic lives of finite lived intangible assets and property, plant and
equipment.
The majority of the Group’s provisions are either long-term in nature (such as asset retirement obligations) or relate to shorter-term liabilities (such
as those relating to restructuring and property) where there is not considered to be a significant risk of material adjustment in the next financial year.
Critical judgements exercised in respect of tax disputes include cases in India and a tax dispute related to financing costs in the Netherlands.
These critical accounting judgements, estimates and related disclosures have been discussed with the Group’s Audit and Risk Committee.
Critical accounting judgements and key sources of estimation uncertainty
Revenue recognition
Revenue recognition under IFRS 15 necessitates the collation and processing of very large amounts of data and the use of management
judgements and estimates to produce financial information. The most significant accounting judgements and source of estimation uncertainty are
disclosed below.
Gross versus net presentation
If the Group has control of goods or services when they are delivered to a customer, then the Group is the principal in the sale to the customer;
otherwise the Group is acting as an agent. Whether the Group is considered to be the principal or an agent in the transaction depends on analysis by
management of both the legal form and substance of the agreement between the Group and its business partners; such judgements impact the
amount of reported revenue and operating expenses (see note 2 ‘Revenue disaggregation and segmental analysis’) but do not impact reported
assets, liabilities or cash flows. Scenarios requiring judgement to determine whether the Group is a principal or an agent include, for example, those
where the Group delivers third-party branded software or services (such as premium music, TV content or cloud-based services) to customers and
those where goods or services are delivered to customers in partnership with a third-party.
140
Vodafone Group Plc
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Financials
Other information
Notes to the consolidated financial statements (continued)
1. Basis of preparation (continued)
Allocation of revenue to goods and services provided to customers
Revenue is recognised when goods and services are delivered to customers (see note 2 ‘Revenue disaggregation and segmental analysis’). Goods and
services may be delivered to a customer at different times under the same contract, hence it is necessary to allocate the amount payable by the
customer between goods and services on a ‘relative standalone selling price basis’; this requires the identification of performance obligations
(‘obligations’) and the determination of standalone selling prices for the identified obligations. The determination of obligations is, for the primary goods
and services sold by the Group, not considered to be a critical accounting judgement; the Group’s policy on identifying obligations is disclosed in note 2
‘Revenue disaggregation and segmental analysis’. The determination of standalone selling prices for identified obligations is discussed below.
It is necessary to estimate the standalone price when the Group does not sell equivalent goods or services in similar circumstances on a standalone
basis. When estimating the standalone price the Group maximises the use of external inputs; methods for estimating standalone prices include
determining the standalone price of similar goods and services sold by the Group, observing the standalone prices for similar goods and services when
sold by third parties or using a cost-plus reasonable margin approach (which is sometimes the case for devices and other equipment). Where it is not
possible to reliably estimate standalone prices due to a lack of observable standalone sales or highly variable pricing, which is sometimes the case for
services, the standalone price of an obligation may be determined as the transaction price less the standalone prices of other obligations in the contract.
The standalone price determined for obligations materially impacts the allocation of revenue between obligations and impacts the timing of revenue
when obligations are provided to customers at different times – for example, the allocation of revenue between devices, which are usually delivered up-
front, and services which are typically delivered over the contract period. However, there is not considered to be a significant risk of material adjustment
to the carrying value of contract-related assets or liabilities in the 12 months after the balance sheet date if these estimates were revised.
Lease accounting
Lease accounting under IFRS 16 is complex and necessitates the collation and processing of very large amounts of data and the increased use of
management judgements and estimates to produce financial information. The most significant accounting judgements are disclosed below.
Lease identification
Whether the arrangement is considered a lease or a service contract depends on the analysis by management of both the legal form and substance of
the arrangement between the Group and the counter-party to determine if control of an identified asset has been passed between the parties; if not, the
arrangement is a service arrangement. Control exists if the Group obtains substantially all of the economic benefit from the use of the asset, and has the
ability to direct its use, for a period of time. An identified asset exists where an agreement explicitly or implicitly identifies an asset or a physically distinct
portion of an asset which the lessor has no substantive right to substitute.
The scenarios requiring the greatest judgement include those where the arrangement is for the use of fibre or other fixed telecommunication lines.
Generally, where the Group has exclusive use of a physical line it is determined that the Group can also direct the use of the line and therefore leases will
be recognised. Where the Group provides access to fibre or other fixed telecommunication lines to another operator on a wholesale basis the
arrangement will generally be identified as a lease, whereas when the Group provides fixed line services to an end-user, generally control over such lines
is not passed to the end-user and a lease is not identified.
Where the Group contracts with tower companies to utilise space on a tower for the placement of transmission equipment for a period of time, the
arrangement will generally be identified as a lease.
The impact of determining whether an agreement is a lease or a service depends on whether the Group is a potential lessee or lessor in the arrangement
and, where the Group is a lessor, whether the arrangement is classified as an operating or finance lease. The impacts for each scenario are described
below where the Group is potentially:
- A lessee. The judgement impacts the nature and timing of both costs and reported assets and liabilities. A lease results in an asset and a liability being
reported and depreciation and interest being recognised; the interest charge will decrease over the life of the lease. A service contract results in
operating expenses being recognised evenly over the life of the contract and no assets or liabilities being recorded (other than trade payables,
prepayments and accruals).
- An operating lessor. The judgement impacts the nature of income recognised. An operating lease results in lease income being recognised whilst a
service contract results in service revenue. Both are recognised evenly over the life of the contract.
- A finance lessor. The judgement impacts the nature and timing of both income and reported assets. A finance lease results in the lease income being
recognised at commencement of the lease and an asset (the net investment in the lease) being recorded.
Lease term
Where leases include additional optional periods after an initial lease term, significant judgement is required in determining whether these optional
periods should be included when determining the lease term. The impact of this judgement is significantly greater where the Group is a lessee. As a
lessee, optional periods are included in the lease term if the Group is reasonably certain it will exercise an extension option or will not exercise a
termination option; this depends on an analysis by management of all relevant facts and circumstances including the leased asset’s nature and purpose,
the economic and practical potential for replacing the asset and any plans that the Group has in place for the future use of the asset. Where a leased
asset is highly customised (either when initially provided or as a result of leasehold improvements) or it is impractical or uneconomic to replace then the
Group is more likely to judge that lease extension options are reasonably certain to be exercised. The value of the right-of-use asset and lease liability will
be greater when extension options are included in the lease term. The normal approach adopted for lease term by asset class is described below.
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The lease terms can vary significantly by type and use of asset and geography. In addition, the exact lease term is subject to the non-cancellable period
and rights and options in each contract. Generally, lease terms are judged to be the longer of the non-cancellable term and:
- Between 5 and 10 years for land and buildings (excluding retail), with terms at the top end of this range if the lease relates to assets that are considered
to be difficult to exit sooner for economic, practical or reputational reasons;
- The period to the next contractual lease break date for retail premises (excluding breaks within the next 12 months);
- The lease term, or useful economic life, of the assets connected for leases that are used to provide internal connectivity;
- The customer service agreement length for leases of local loop connections or other assets required to provide fixed line or other services to
individual customers; and
- 5 years where the Group has leases for the use of space on towers for the placement of transmission equipment.
In most instances the Group has options to renew or extend leases for additional periods after the end of the lease term which are assessed using the
criteria above.
Lease terms are reassessed if a significant event or change in circumstances occurs relating to the leased assets that is within the control of the Group;
such changes usually relate to commercial agreements entered into by the Group, or business decisions made by the Group. Where such changes
change the Group’s assessment of whether it is reasonably certain to exercise options to extend, or not terminate leases, then the lease term is
reassessed and the lease liability is remeasured, which in most cases will increase the lease liability.
Taxation
The Group’s tax charge on ordinary activities is the sum of the total current and deferred tax charges. The calculation of the Group’s total tax charge
involves estimation and judgement in respect of certain matters, being principally:
Recognition of deferred tax assets
Significant items on which the Group has exercised accounting estimation and judgement include the recognition of deferred tax assets in respect
of losses in Luxembourg, Germany, Italy1 and Spain1 as well as capital allowances in the United Kingdom. The recognition of deferred tax assets,
particularly in respect of tax losses, is based upon whether management judge that it is probable that there will be sufficient and suitable taxable
profits in the relevant legal entity or tax group against which to utilise the assets in the future. The Group assesses the availability of future taxable
profits using the same undiscounted five year forecasts for the Group’s operations as are used in the Group’s value in use calculations (see note 4
‘Impairment losses’). In the case of Luxembourg, this includes forecasts of future income from the Group’s internal financing, centralised
procurement and roaming activities.
Where tax losses are forecast to be recovered beyond the five year period, the availability of taxable profits is assessed using the cash flows and long-
term growth rates used for the value in use calculations.
The estimated cash flows inherent in these forecasts include the unsystematic risks of operating in the telecommunications business including the
potential impacts of changes in the market structure, trends in customer pricing, the costs associated with the acquisition and retention of
customers, future technological evolutions and potential regulatory changes, such as our ability to acquire and/or renew spectrum licences.
Changes in the estimates which underpin the Group’s forecasts could have an impact on the amount of future taxable profits and could have a
significant impact on the period over which the deferred tax asset would be recovered.
The Group only considers substantively enacted tax laws when assessing the amount and availability of tax losses to offset against the future taxable
profits. See note 6 ‘Taxation’ to the consolidated financial statements.
See additional commentary relating to climate change below.
Uncertain tax positions
The tax impact of a transaction or item can be uncertain until a conclusion is reached with the relevant tax authority or through a legal process. The
Group uses in-house tax experts when assessing uncertain tax positions and seeks the advice of external professional advisors where appropriate.
The most significant judgements in this area relate to the Group’s tax disputes in India and a tax dispute related to financing costs in the Netherlands.
Further details of tax disputes are included in note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements.
Business combinations and goodwill
When the Group completes a business combination, the fair values of the identifiable assets and liabilities acquired, including intangible assets, are
recognised. The determination of the fair values of acquired assets and liabilities is based, to a considerable extent, on management’s judgement. If the
purchase consideration exceeds the fair value of the net assets acquired then the incremental amount paid is recognised as goodwill. If the purchase
price consideration is lower than the fair value of the assets acquired then the difference is recorded as a gain in the income statement.
Allocation of the purchase price between finite lived assets (discussed below) and indefinite lived assets such as goodwill affects the subsequent results
of the Group as finite lived intangible assets are amortised, whereas indefinite lived intangible assets, including goodwill, are not amortised.
See note 27 ‘Acquisitions and disposals’ to the consolidated financial statements for further details.
Note:
1 Deferred tax assets in respect of losses in Vodafone Italy and Vodafone Spain are reported with Assets held for sale. See note 7 ‘Discontinued operations and assets held for sale’ for more
information.
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Notes to the consolidated financial statements (continued)
1. Basis of preparation (continued)
Joint arrangements
The Group participates in a number of joint arrangements where control of the arrangement is shared with one or more other parties. Judgement is
required to classify joint arrangements in a separate legal entity as either a joint operation or as a joint venture, which depends on management’s
assessment of the legal form and substance of the arrangement taking into account relevant facts and circumstances such as whether the owners have
rights to substantially all the economic outputs and, in substance, settle the liabilities of the entity.
The classification can have a material impact on the consolidated financial statements. The Group’s share of assets, liabilities, revenue, expenses and
cash flows of joint operations are included in the consolidated financial statements on a line-by-line basis, whereas the Group’s investment and share of
results of joint ventures are shown within single line items in the consolidated statement of financial position and consolidated income statement
respectively. See note 12 ‘Investments in associates and joint arrangements’ to the consolidated financial statements.
Finite lived intangible assets
Other intangible assets include amounts spent by the Group acquiring licences and spectrum, customer bases and the costs of purchasing and
developing computer software.
Where intangible assets are acquired through business combinations and no active market for the assets exists, the fair value of these assets is
determined by discounting estimated future net cash flows generated by the asset. Estimates relating to the future cash flows and discount rates used
may have a material effect on the reported amounts of finite lived intangible assets.
Estimation of useful life
The useful life over which intangible assets are amortised depends on management’s estimate of the period over which economic benefit will be derived
from the asset. Useful lives are periodically reviewed to ensure that they remain appropriate. Management’s estimates of useful life have a material
impact on the amount of amortisation recorded in the year, but there is not considered to be a significant risk of material adjustment to the carrying
values of intangible assets in the year to 31 March 2025 if these estimates were revised. The basis for determining the useful life for the most significant
categories of intangible assets are discussed below.
Customer bases
The estimated useful life principally reflects management’s view of the average economic life of the customer base and is assessed by reference to
customer churn rates. An increase in churn rates may lead to a reduction in the estimated useful life and an increase in the amortisation charge.
Capitalised software
For computer software, the estimated useful life is based on management’s view, considering historical experience with similar products as well as
anticipation of future events which may impact their life such as changes in technology. The useful life will not exceed the duration of a licence.
Property, plant and equipment
Property, plant and equipment represents 19.7% of the Group’s total assets (2023: 24.4%). Estimates and assumptions made may have a material impact
on their carrying value and related depreciation charge. See note 11 ‘Property, plant and equipment’ to the consolidated financial statements for further
details.
Estimation of useful life
The depreciation charge for an asset is derived using estimates of its expected useful life and expected residual value, which are reviewed annually.
Management’s estimates of useful life have a material impact on the amount of depreciation recorded in the year, but there is not considered to be a
significant risk of material adjustment to the carrying values of property, plant and equipment in the year to 31 March 2025 if these estimates were
revised.
Management determines the useful lives and residual values for assets when they are acquired, based on experience with similar assets and taking into
account other relevant factors such as any expected changes in technology.
See additional commentary relating to climate change, below.
Post employment benefits
Management uses estimates when determining the Group’s liabilities and expenses arising for defined benefit pension schemes. Management is
required to estimate the future rates of inflation, salary increases, discount rates and longevity of members, each of which may have a material impact on
the defined benefit obligations that are recorded. Further details, including a sensitivity analysis, are included in note 25 ‘Post employment benefits’ to
the consolidated financial statements.
In addition, plan assets are recognised at fair value at the reporting date in accordance with IFRS 13 ‘Fair Value Measurement’. Where assets do not have
observable prices, estimation is necessary to determine fair values. In estimating fair value, market-observable data is used to the extent it is available.
Contingent liabilities
The Group exercises judgement to determine whether to recognise provisions and the exposures to contingent liabilities related to pending litigations or
other outstanding claims subject to negotiated settlement, mediation, arbitration or government regulation, as well as other contingent liabilities (see
note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements). Judgement is necessary to assess the likelihood that a
pending claim will succeed, or a liability will arise.
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Impairment reviews
IFRS requires management to perform impairment tests annually for indefinite lived assets, for finite lived assets and for equity accounted
investments if events or changes in circumstances indicate that their carrying amounts may not be recoverable.
Management is required to make significant judgements concerning the identification of impairment indicators and the determination of
recoverable amounts for its assets which are based on the higher of their fair value less costs to sell and their value in use. Observable market data
on fair values for equivalent assets is often limited and, for a number of reasons, transaction values agreed as part of any business acquisition or
disposal may be higher than the assessed value in use.
The Group performs an annual impairment test which focuses on determining the recoverable amounts for its assets based on value in use, being
the present value of the future cash flows it expects to generate from the continuing use of its assets or cash-generating units.
Calculating the net present value of the future cash flows requires estimates to be made in respect of highly uncertain matters including
management’s expectations of:
− Growth in Adjusted EBITDAaL, (see note 2 ‘Revenue disaggregation and segmental analysis’ for a reconciliation to the consolidated income
statement);
− Timing and amount of future capital expenditure, licence and spectrum payments;
− Long-term growth rates; and
− Discount rates that reflect the future cash flows.
Changing the assumptions selected by management, in particular projected Adjusted EBITDAaL, long-term growth rate and discount rate
assumptions, could significantly affect the Group’s impairment evaluation and hence reported assets and profit or loss. Further details, including a
sensitivity analysis, are included in note 4 ‘Impairment losses’ to the consolidated financial statements.
Where the Group has interests in listed entities, market data, such as share price, is used to assess the fair value of those interests. If the market
capitalisation indicates that their carrying amounts may not be recoverable, possible adjustments to the share price are reviewed and, where
information is available, a value in use calculation is performed to support a conclusion on impairment.
For operations that are classified as held for sale, management is required to determine whether the carrying value of the discontinued operation
can be supported by the fair value less costs to sell. Where not observable in a quoted market, management has determined fair value less costs to
sell by reference to the outcomes from the application of a number of potential valuation techniques, determined from inputs other than quoted
prices that are observable for the asset or liability, either directly or indirectly.
See additional commentary relating to climate change, below.
Held for sale accounting
When the value of a non-current asset or a group of assets in a disposal group will be primarily recovered through a sale transaction and there is an
active plan for the disposal such that it is highly probable that the disposal will be completed within 12 months (subject to certain matters outside of
the Group’s control) then the related assets will be classified as held for sale and, where appropriate, as a discontinued operation.
Judgement is applied by management in determining if assets meet the requirements to be classified as held for sale and, where appropriate, as
discontinued operations. Further detail is provided in note 7 ‘Discontinued operations and assets held for sale’.
Climate change
The potential climate change-related risks and opportunities to which the Group is exposed, as identified by management, are disclosed in the
Group’s Task Force on Climate-Related Financial Disclosures (‘TCFD’) on pages 64 to 69. Management has assessed the potential financial impacts
relating to the identified risks, primarily considering the useful lives of, and retirement obligations for, property, plant and equipment, the possibility
of impairment of goodwill and other long-lived assets and the recoverability of the Group’s deferred tax assets. Management has exercised
judgement in concluding that there are no further material financial impacts of the Group’s climate-related risks and opportunities on the
consolidated financial statements. These judgements will be kept under review by management as the future impacts of climate change depend on
environmental, regulatory and other factors outside of the Group’s control which are not all currently known.
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Notes to the consolidated financial statements (continued)
1. Basis of preparation (continued)
Significant accounting policies applied in the current reporting period that relate to the financial statements as a
whole
Accounting convention
The consolidated financial statements are prepared on a historical cost basis except for certain financial and equity instruments that have been
measured at fair value and for the application of IAS 29 ‘Financial Reporting in Hyperinflationary Economies’ for the Group’s entities reporting in
Turkish lira and its associate’s reporting in Ethiopian birr (see below).
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company, subsidiaries controlled by the Company (see note 31
‘Related undertakings’ to the consolidated financial statements), joint operations that are subject to joint control and the results of joint ventures
and associates (see note 12 ‘Investments in associates and joint arrangements’ to the consolidated financial statements).
Hyperinflationary economies
The Turkish and Ethiopian economies were designated as hyperinflationary from 30 June 2022 and 31 December 2022, respectively. The Group has
applied IAS 29 ‘Financial Reporting in Hyperinflationary Economies’ to its Turkish and Ethiopian operations whose functional currencies are Turkish
lira and Ethiopian birr from 1 April 2022.
In applying IAS 29, the Turkish lira and Ethiopian birr results and non-monetary asset and liability balances for relevant financial years have been
revalued to their present value equivalent local currency amounts at the reporting date, based on the consumer price indexes issued by the Turkish
Statistical Institute and the Central Statistics Agency of Ethiopia respectively. Comparative periods are not restated per IAS 21 ‘The Effects of
Changes in Foreign Exchange rates’. The respective indices have risen by 68.5% and 26.2% (2023: 50.5% and 31.3% ) during this financial year. The
revalued balances are translated to euros at the reporting date exchange rate of €1: 34.94 TRL and €1: 61.43 ETB (2023: €1: 20.85 TRL and €1:58.59
ETB) respectively applying IAS 21.
For the Group’s operations in Turkey:
− The gain or loss on the revaluation of net monetary assets resulting from IAS 29 application is recognised in the consolidated income
statement within Other income.
− The Group also presents the gain or loss on cash and cash equivalents as monetary items together with the effect of inflation on operating,
investing and financing cash flows as one number in the consolidated statement of cash flows.
− The Group has presented the equity revaluation effects and the impact of currency movements within other comprehensive income as such
amounts are judged to meet the definition of ‘exchange differences’.
For Safaricom’s operations in Ethiopia, the impacts are reflected as an increase to Investments in associates and joint ventures in the Consolidated
statement of financial position and an increase to Share of results of equity accounted associates and joint ventures recognised in the Consolidated
income statement.
The main impacts of the aforementioned adjustments for the Group’s Turkish and Ethiopian operations on the consolidated financial statements
are shown below.
Increase/(decrease)
Increase/(decrease)
2024
2023
€m
€m
Impact on the consolidated income statement for the years ended 31 March
Revenue
111
85
Operating profit1
66
(87)
Profit for the financial year1
(169)
(123)
Increase/(decrease)
Increase/(decrease)
31 March 2024
31 March 2023
€m
€m
Impact on the consolidated statement of financial position at 31 March
Net assets
981
814
Equity attributable to owners of the parent
913
777
Non-controlling interests
68
37
Note:
1 Includes €360 million gain on the net monetary assets/liabilities (2023: €198 million gain).
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In addition, it is expected that Egypt will meet the requirements to be designated as a hyperinflationary economy under IAS 29 before 31 December
2024. If the Egyptian economy is designed as hyperinflationary, the Group’s financial reporting relating to its operations in Egypt during the year
ending 31 March 2025 will be in accordance with IAS 29 applying the Group’s policy detailed above.
Foreign currencies
The consolidated financial statements are presented in euro, which is also the Company’s functional currency. Each entity in the Group determines
its own functional currency and items included in the financial statements of each entity are measured using that functional currency.
With the exception of the Group’s Turkish lira operations and Safaricom’s Ethiopian birr operations, which are subject to hyperinflation accounting
(see above), transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates
prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the
rates prevailing on the initial transaction dates. Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
Share capital, share premium and other capital reserves are initially recorded at the functional currency rate prevailing at the date of the transaction
and are not retranslated.
For the purpose of presenting consolidated financial statements, the assets and liabilities of entities with a functional currency other than euro are
expressed in euro using exchange rates prevailing at the reporting period date.
Income and expense items and cash flows are translated at the average exchange rates for each month and exchange differences arising are
recognised directly in other comprehensive income. On disposal of a foreign entity, the cumulative amount previously recognised in the
consolidated statement of comprehensive income relating to that particular foreign operation is recognised in profit or loss in the consolidated
income statement.
Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and
translated accordingly.
The net foreign exchange loss recognised in the consolidated income statement for the year ended 31 March 2024 is €272 million (31 March 2023:
€111 million gain; 2022: €309 million loss). The net gains and net losses are recorded within operating profit (2024: €110 million charge; 2023:
€247 million credit; 2022: €24 million charge), financing costs (2024: €173 million charge; 2023: €135 million charge; 2022: €284 million charge)
and income tax expense (2024: €11 million credit; 2023: €1 million charge; 2022: €1 million charge). The foreign exchange gains and losses
included within other income arise on the disposal of subsidiaries, interests in joint ventures, associates and investments from the recycling of
foreign exchange gains and losses previously recognised in the consolidated statement of comprehensive income.
Current or non-current classification
Assets are classified as current in the consolidated statement of financial position where recovery is expected within 12 months of the reporting
date. All assets where recovery is expected more than 12 months from the reporting date and all deferred tax assets, goodwill and intangible assets,
property, plant and equipment and investments in associates and joint ventures are reported as non-current.
Liabilities are classified as current unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the
reporting date. For provisions, where the timing of settlement is uncertain, amounts are classified as non-current where settlement is expected
more than 12 months from the reporting date. In addition, deferred tax liabilities and post-employment benefits are reported as non-current.
Inventory
Inventory is stated at the lower of cost and net realisable value. Cost is determined on the basis of weighted average costs and comprises direct
materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present
location and condition.
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Notes to the consolidated financial statements (continued)
1. Basis of preparation (continued)
New accounting pronouncements adopted on 1 April 2023
The Group adopted the following new accounting policies on 1 April 2023 to comply with new standards issued and amendments to IFRS:
− IFRS 17 ‘Insurance Contracts’;
− Amendments to IAS 1 ‘Disclosure of Accounting Policies’;
− Amendment to IAS 8 ‘Definition of Accounting Estimates’;
− Amendment to IAS 12 ‘Deferred Tax related to Assets and Liabilities arising from a Single Transaction’; and
− Amendment to IAS 12 ‘International Tax Reform - Pillar Two Model Rules’.
The amendments to IAS 1, IAS 8 and IAS 12 do not have a material impact on the Group’s financial reporting on adoption. The impact of the
adoption of IFRS 17 and of the IAS 12 Pillar Two Model Rules is addressed below.
IFRS 17 ‘Insurance Contracts’
IFRS 17 ‘Insurance Contracts’ was adopted by the Group on 1 April 2023. The Standard sets out revised principles for the recognition, measurement,
presentation, and disclosure of obligations relating to insurance contracts issued by preparers in order to provide a single accounting model for all
types of insurance.
The Group issues certain short and long-term contracts, primarily being (i) the reinsurance of handset and other device insurance issued by a
fronting insurer to the Group’s customers; and (ii) the reinsurance of a third-party annuity policy issued to the Vodafone and Cable & Wireless
(‘CWW’) sections of the Vodafone UK Group Pension Scheme (refer to note 25 ‘Post employment benefits’). The adoption of IFRS 17 did not have a
material impact on prior period equity.
The adoption of IFRS 17 results in separate insurance and reinsurance liability line items being presented within the Trade and other payables
disclosure note to the consolidated financial statements, with corresponding reductions in the Trade payables and Other payables line items (see
note 15 ‘Trade and other payables’). The reclassification as at 31 March 2023 amounts to €257 million and €63 million within the Non-current and
Current Trade and other payables notes, respectively. The Non-current and Current Insurance and reinsurance liability amounts included within
Trade and other payables at 31 March 2024 are €254 million and €48 million, respectively. The adoption has not resulted in any material
adjustments to any other balances or primary statements including equity or to the consolidated income statement.
Amendments to IAS 12 ‘International Tax Reform - Pillar Two Model Rules’
On 23 May 2023, the IASB issued amendments to IAS 12 ‘Income Taxes’ to provide a mandatory temporary exception to the accounting for deferred
taxes arising in relation to International Tax Reform (the ‘Pillar Two’ rules) and to require additional disclosures regarding the impact of the Pillar Two
regulations. The amendments to IAS 12 have been adopted by the Group for the purposes of reporting at 31 March 2024, with additional disclosure
also required in the year commencing 1 April 2024.
The Group has applied the mandatory temporary exception and therefore has not recognised or disclosed deferred tax assets or liabilities relating to
Pillar Two regulations within the consolidated financial statements for the year ended 31 March 2024. The introduction of Pillar Two regulations is
not expected to result in any material future impact on the Group’s current tax expense.
See note 6 ‘Taxation’ for further details.
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New accounting pronouncements to be adopted on or after 1 April 2024
The following amendments have been issued by the IASB and are effective for annual periods beginning on or after 1 January 2024. These
amendments have been endorsed by the UK Endorsement Board.
− Amendments to IAS 1 ‘Classification of Liabilities as Current or Non-current’ and ‘Non-current Liabilities with Covenants’;
− Amendments to IFRS 16 ‘Lease Liability in a Sale and Leaseback’; and
− Amendments to IAS 7 and IFRS 7 ‘Supplier Finance Arrangements’.
The impact of adopting the above two amendments to IAS 1 ‘Presentation of Financial Statements’ is discussed below. No impact is expected from
the adoption of the amendments to IFRS 16. The Group will provide additional disclosures in future Annual Reports in respect of supplier
arrangements as a result of the option of the amendments to IAS 7 and IFRS 7.
Amendments to IAS 1 ‘Presentation of Financial Statements’
The Group classifies balances relating to certain bonds as current liabilities if it is the Group’s intention to exercise options to redeem them within 12
months of the reporting date. Following the adoption of the IAS 1 amendments on 1 April 2024, bonds that are repayable in more than 12 months
will be classified as Non-current liabilities regardless of any intention to redeem the bonds early. The impact of adopting the amendments on the
consolidated statement of financial position at 31 March 2024 is a €931 million (31 March 2023: €2,013 million; 1 April 2022: €nil) reduction to the
value of bonds presented within Current borrowings which will be re-presented as bonds within Non-current borrowings.
The Group’s financial reporting will be presented in accordance with these standards from 1 April 2024 as applicable.
New accounting pronouncements to be adopted on or after 1 April 2025
The following new standards and amendments have been issued by the IASB but have not yet been endorsed by the UK Endorsement Board.
− IFRS 18 ‘Presentation and Disclosure in Financial Statements’; and
− Amendments to IAS 21‘Lack of Exchangeability’.
IFRS 18 is effective for annual periods beginning on or after 1 January 2027 whilst the amendments to IAS 21 is effective for annual periods
beginning on or after 1 January 2025.
The Group is assessing the impact of these new standards and amendments and the Group’s financial reporting will be presented in accordance
with these standards from 1 April 2025 or subsequently as applicable.
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Notes to the consolidated financial statements (continued)
2. Revenue disaggregation and segmental analysis
The Group’s businesses are managed on a geographical basis. Selected financial data is presented on this basis below.
Accounting policies
Revenue
When the Group enters into an agreement with a customer, goods and services deliverable under the contract are identified as separate
performance obligations (‘obligations’) to the extent that the customer can benefit from the goods or services on their own and that the separate
goods and services are considered distinct from other goods and services in the agreement. Where individual goods and services do not meet the
criteria to be identified as separate obligations they are aggregated with other goods and/or services in the agreement until a separate obligation is
identified. The obligations identified will depend on the nature of individual customer contracts, but might typically be separately identified for
mobile handsets, other equipment such as set-top boxes and routers provided to customers and services provided to customers such as mobile and
fixed line communication services. The Group’s digital services and Internet of Things (‘IoT’) customer offers typically include separate obligations
for communications services, as well as equipment and software or software as a service (‘SaaS’). Where goods and services have a functional
dependency (for example, a fixed line router can only be used with the Group’s services) this does not, in isolation, prevent those goods or services
from being assessed as separate obligations. Activities relating to connecting customers to the Group’s network for the future provision of services
are not considered to meet the criteria to be recognised as obligations except to the extent that the control of related equipment passes to
customers.
The Group determines the transaction price to which it expects to be entitled in return for providing the promised obligations to the customer based
on the committed contractual amounts, net of sales taxes and discounts. Where indirect channel dealers, such as retailers, acquire customer
contracts on behalf of the Group and receive commission, any commissions that the dealer is compelled to use to fund discounts or other
incentives to the customer are treated as payments to the customer when determining the transaction price and consequently are not included in
contract acquisition costs.
The transaction price is allocated between the identified obligations according to the relative standalone selling prices of the obligations. The
standalone selling price of each obligation deliverable in the contract is determined according to the prices that the Group would achieve by selling
the same goods and/or services included in the obligation to a similar customer on a standalone basis; where standalone selling prices are not
directly observable, estimation techniques are used maximising the use of external inputs. See ‘Critical accounting judgements and key sources of
estimation uncertainty’ in note 1 for details. Revenue is recognised when the respective obligations in the contract are delivered to the customer
and cash collection is considered probable. Revenue for the provision of services, such as mobile airtime, fixed line broadband, other
communications services and SaaS, is recognised when the Group provides the related service during the agreed service period.
Revenue for device sales to end customers is generally recognised when the device is delivered to the end customer. For device sales made to
intermediaries such as indirect channel dealers, revenue is recognised if control of the device has transferred to the intermediary and the
intermediary has no right to return the device to receive a refund; otherwise revenue recognition is deferred until sale of the device to an end
customer by the intermediary or the expiry of any right of return.
Where refunds are issued to customers they are deducted from revenue in the relevant service period.
When the Group has control of goods or services prior to delivery to a customer, then the Group is the principal in the sale to the customer. As a
principal, receipts from, and payments to, suppliers are reported on a gross basis in revenue and operating costs. If another party has control of
goods or services prior to transfer to a customer, then the Group is acting as an agent for the other party and revenue in respect of the relevant
obligations is recognised net of any related payments to the supplier and recognised revenue represents the margin earned by the Group. See
‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 for details.
Customers typically pay in advance for prepay mobile services and monthly for other communication services. Customers typically pay for handsets
and other equipment either up-front at the time of sale or over the term of the related service agreement.
When revenue recognised in respect of a customer contract exceeds amounts received or receivable from a customer at that time a contract asset
is recognised; contract assets will typically be recognised for handsets or other equipment provided to customers where payment is recovered by
the Group via future service fees. Once the amount receivable becomes conditional only on the passage of time, the contract asset becomes a trade
receivable (see note 14 ‘Trade and other receivables’). If amounts received or receivable from a customer exceed revenue recognised for a contract,
for example if the Group receives an advance payment from a customer, a contract liability is recognised.
When contract assets or liabilities are recognised, a financing component may exist in the contract; this is typically the case when a handset or other
equipment is provided to a customer up-front but payment is received over the term of the related service agreement, in which case the customer is
deemed to have received financing. If a significant financing component is provided to the customer, the transaction price is reduced and interest
revenue is recognised over the customer’s payment period using an interest rate reflecting the relevant central bank rates and customer credit risk.
Contract-related costs
When costs directly relating to a specific contract are incurred prior to recognising revenue for a related obligation, and those costs enhance the
ability of the Group to deliver an obligation and are expected to be recovered, then those costs are recognised in the consolidated statement of
financial position as fulfilment costs and are recognised as expenses in line with the recognition of revenue when the related obligation is delivered.
The direct and incremental costs of acquiring a contract including, for example, certain commissions payable to staff or agents for acquiring
customers on behalf of the Group, are recognised as contract acquisition cost assets in the consolidated statement of financial position when the
related payment obligation is recorded. Costs are recognised as an expense in line with the recognition of the related revenue that is expected to be
earned by the Group; typically this is over the customer contract period as new commissions are payable on contract renewal. Certain amounts
payable to agents are deducted from revenue recognised (see above).
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Segmental analysis
The Group’s operating segments are established on the basis of those components of the Group that are evaluated regularly by the chief operating
decision maker in deciding how to allocate resources and in assessing performance. The Group has determined the chief operating decision maker
to be its Chief Executive. The Group has a single group of similar services and products, being the supply of communications services and related
products.
On 1 April 2023, the Group revised its segments by moving Vodafone Egypt from the Other Markets segment to the Vodacom segment, following
the transfer of Vodafone Egypt to the Vodacom group in December 2022. Consequently, the Vodacom segment has been re-named to ‘Africa’ and
the Other Markets segment has been re-named to ‘Turkey’ because this segment comprised only Vodafone Turkey during the year ended 31 March
2024.
In October 2023 and March 2024, the Group announced the planned disposals of Vodafone Spain and Vodafone Italy, respectively. Consequently,
Vodafone Spain and Vodafone Italy have been classified as discontinued operations and are therefore no longer reporting segments of the Group.
Revenue is attributed to a country based on the location of the Group company reporting the revenue. Transactions between operating segments
are charged at arm’s-length prices.
The operating segments for Germany, UK and Africa are individually material for the Group and are each reporting segments for which certain
financial information is provided. In addition, the Vantage Towers operating segment was a separately listed part of the Group until its disposal into a
joint venture on 22 March 2023 (see note 27 ‘Acquisitions and disposals’) and is presented as a reporting segment until the date of its disposal as it is
considered to provide useful information to users of the financial statements. The aggregation of smaller operating segments into the Other Europe
and Turkey reporting segments reflects, in the opinion of management, the similar local market economic characteristics and regulatory
environments for each of those operating segments as well as the similar products and services sold and comparable classes of customers. In the
case of the Other Europe region (comprising Albania, Czech Republic, Greece, Hungary (until its disposal on 31 January 2023), Ireland, Portugal and
Romania), this largely reflects membership or a close association with the European Union, whilst the Turkey segment (comprising Turkey and
Ghana until its disposal on 21 February 2023) sits outside the European Union and has different economic and regulatory environment
characteristics. Common Functions is a separate reporting segment and comprises activities which are undertaken primarily in central Group
entities that do not meet the criteria for aggregation with other reporting segments.
A reconciliation of adjusted EBITDAaL, the Group’s measure of segment profit, to the Group’s profit or loss before taxation for the financial year is
shown below.
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Adjusted EBITDAaL
11,019
12,424
12,693
Restructuring costs
(703)
(538)
(213)
Interest on lease liabilities
440
355
320
Loss on disposal of property, plant and equipment and intangible assets
(34)
(41)
(37)
Depreciation and amortisation on owned assets
(7,397)
(7,520)
(7,656)
Share of results of equity accounted associates and joint ventures
(96)
433
389
Impairment reversal/(loss)2
64
(64)
–
Other income
372
9,402
244
Operating profit
3,665
14,451
5,740
Investment income
581
232
251
Finance costs
(2,626)
(1,609)
(1,842)
Profit before taxation
1,620
13,074
4,149
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 The impairment reversal/(loss) for the years ended 31 March 2024 and 31 March 2023 relates to Indus Towers. See overleaf and note 4 ‘Impairment losses’.
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Notes to the consolidated financial statements (continued)
2. Revenue disaggregation and segmental analysis (continued)
Revenue disaggregation and segmental income statement analysis
Revenue reported for the year includes revenue from contracts with customers, comprising service and equipment revenue, as well as other
revenue items including revenue from leases and interest revenue arising from transactions with a significant financing component.
The tables below present Revenue and Adjusted EBITDAaL for the year ended 31 March 2024 and for the comparative years ended 31 March 2023
and 31 March 2022.
Revenue from
Total
Service
Equipment
contracts with
Other
Interest
segment
Adjusted
31 March 2024
revenue
revenue
customers
revenue1
revenue
revenue
EBITDAaL
€m
€m
€m
€m
€m
€m
€m
Germany
11,453
1,132
12,585
357
15
12,957
5,017
UK
5,631
1,111
6,742
54
41
6,837
1,408
Other Europe
4,722
665
5,387
102
15
5,504
1,516
Africa
5,951
1,030
6,981
409
30
7,420
2,539
Turkey
1,746
609
2,355
7
–
2,362
510
Common Functions2
559
49
608
1,256
–
1,864
29
Eliminations
(150)
(1)
(151)
(76)
–
(227)
–
Group
29,912
4,595
34,507
2,109
101
36,717
11,019
Revenue from
Total
Service
Equipment
contracts with
Other
Interest
segment
Adjusted
31 March 2023 Re-presented3
revenue
revenue
customers
revenue1
revenue
revenue
EBITDAaL
€m
€m
€m
€m
€m
€m
€m
Germany
11,433
1,313
12,746
350
17
13,113
5,323
UK
5,358
1,375
6,733
58
33
6,824
1,350
Other Europe4
5,005
602
5,607
117
20
5,744
1,632
Africa5
6,556
1,089
7,645
403
28
8,076
2,880
Turkey6
1,593
475
2,068
4
–
2,072
424
Vantage Towers
–
–
–
1,338
–
1,338
795
Common Functions2
530
47
577
1,191
–
1,768
20
Eliminations
(157)
(1)
(158)
(1,105)
–
(1,263)
–
Group
30,318
4,900
35,218
2,356
98
37,672
12,424
Revenue from
Total
Service
Equipment
contracts with
Other
Interest
segment
Adjusted
31 March 2022 Re-presented3
revenue
revenue
customers
revenue1
revenue
revenue
EBITDAaL
€m
€m
€m
€m
€m
€m
€m
Germany
11,616
1,126
12,742
365
21
13,128
5,669
UK
5,154
1,333
6,487
69
33
6,589
1,395
Other Europe4
5,001
528
5,529
105
19
5,653
1,606
Africa5
6,386
1,013
7,399
384
24
7,807
2,929
Turkey6
1,669
341
2,010
6
–
2,016
531
Vantage Towers
–
–
–
1,252
–
1,252
619
Common Functions2
522
53
575
1,190
1
1,766
(56)
Eliminations
(141)
(1)
(142)
(1,059)
–
(1,201)
–
Group
30,207
4,393
34,600
2,312
98
37,010
12,693
Notes:
1 Other revenue includes lease revenue recognised under IFRS 16 ‘Leases’ (see note 20 ‘Leases’).
2 Comprises central teams and business functions.
3 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations and are therefore excluded. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
4 The comparative years also include the results of Vodafone Hungary which, as previously reported, was sold in January 2023.
5 From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. The comparatives have been re-presented on the new basis of segmental
reporting. There is no impact on previously reported Group metrics.
6 The Turkey segment comprises only Vodafone Turkey in the year ended 31 March 2024. The comparative years also include the results of Vodafone Ghana which, as previously reported, was
sold in February 2023.
The total future revenue from the remaining term of Group’s contracts with customers for performance obligations not yet delivered to those
customers at 31 March 2024 is €16,577 million (re-presented7 2023: €16,354 million; 2022: €17,902 million); of which €10,488 million (re-
presented7 2023: €10,324 million; 2022: €11,353 million) is expected to be recognised within the next year and the majority of the remaining
amount in the following 12 months.
Notes:
7 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations, decreasing the previously disclosed amount of total future revenue by €2,167 million and €2,111 million respectively as well as future revenue expected to be recognised within
the next year by €1,617 million and €1,560 million respectively. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
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Segmental assets
The tables below present the segmental assets for the year ended 31 March 2024 and for the comparative years ended 31 March 2023 and 31
March 2022.
Non-current
Capital
Right-of-use
Other additions to
Depreciation
and
Impairment
31 March 2024
assets1
additions2
asset additions
intangible assets3
amortisation
reversal6
€m
€m
€m
€m
€m
€m
Germany
42,931
2,565
1,045
–
4,543
–
UK
6,863
878
957
–
1,733
–
Other Europe
7,564
862
442
–
1,447
–
Africa
6,377
1,005
296
163
1,184
–
Turkey
1,644
320
160
120
537
(64)
Common Functions
1,972
782
203
–
970
–
Group
67,351
6,412
3,103
283
10,414
(64)
Non-current
Capital
Right-of-use
Other additions to
Depreciation
and
31 March 2023 Re-presented4
assets1
additions2
asset additions
intangible assets3
amortisation
Impairment loss
€m
€m
€m
€m
€m
€m
Germany
43,878
2,701
2,145
2
4,154
–
Italy
10,235
833
916
5
–
–
UK
6,629
892
1,639
–
1,562
–
Spain
6,331
565
742
8
–
–
Other Europe
7,815
927
1,104
151
1,363
–
Africa5
6,796
1,122
246
264
1,311
–
Turkey6
1,502
235
150
9
546
64
Vantage Towers
–
551
318
–
326
–
Common Functions
2,013
839
127
–
993
–
Group
85,199
8,665
7,387
439
10,255
64
Non-current
Capital
Right-of-use
Other additions to
Depreciation
and
31 March 2022 Re-presented4
assets1
additions2
asset additions
intangible assets3
amortisation
Impairment loss
€m
€m
€m
€m
€m
€m
Germany
43,190
2,670
795
–
3,981
–
Italy
10,519
840
670
255
–
–
UK
6,226
832
580
229
1,905
–
Spain
6,433
676
422
291
–
–
Other Europe
8,548
1,009
502
126
1,511
–
Africa5
7,991
1,136
216
–
1,219
–
Turkey6
859
247
200
–
299
–
Vantage Towers
8,179
366
320
–
523
–
Common Functions
2,103
844
123
–
979
–
Group
94,048
8,620
3,828
901
10,417
–
Notes:
1 Comprises goodwill, other intangible assets and property, plant and equipment.
2 Includes additions to: (i) property, plant and equipment (excluding right-of-use assets) and (ii) computer software, development costs and in relation to identifiable wavelengths, reported
within Intangible assets.
3 Includes additions to licences and spectrum and customer base acquisitions.
4 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
5 From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. The comparatives have been re-presented on the new basis of segmental
reporting. There is no impact on previously reported Group metrics.
6 The Turkey segment comprises only Vodafone Turkey in the year ended 31 March 2024. In the comparative years, the segment was named Other markets and also included the results of
Vodafone Ghana which, as previously reported, was sold in February 2023 and an impairment charge in respect of the Group’s carrying value of Indus Towers Limited during the year ended
31 March 2023 and reversed during the year ended 31 March 2024. See note 4 ‘Impairment losses’ for more information.
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Notes to the consolidated financial statements (continued)
3. Operating profit
Detailed below are the key amounts recognised in arriving at our operating profit
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Amortisation of intangible assets (Note 10)
3,515
3,380
3,425
Depreciation of property, plant and equipment (Note 11):
Owned assets
3,882
4,142
4,274
Leased assets
3,017
2,733
2,718
Impairment (reversal)/loss (Note 4)
(64)
64
–
Staff costs (Note 24)
5,498
5,192
4,620
Amounts related to inventory included in cost of sales
4,659
5,035
4,580
Own costs capitalised attributable to the construction or acquisition of property, plant and
equipment
(1,188)
(1,099)
(944)
Gain on the revaluation of net monetary assets resulting from IAS 29 application2 (Note 1)
(360)
(198)
–
Loss on disposal of Vodafone Hungary2 (Note 27)
–
69
–
Gain on disposal of Vodafone Ghana2 (Note 27)
–
(689)
–
Gain on disposal of Vantage Towers2 (Note 27)
–
(8,729)
–
Gain on disposal of Indus Towers Limited2
–
–
81
Pledge arrangements in respect of Indus Towers Limited (Note 29)
–
–
(15)
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 Included in Other income in the consolidated income statement.
The total remuneration of the Group’s auditor, Ernst & Young LLP and other member firms of Ernst & Young Global Limited, for services provided to
the Group during the year ended 31 March is analysed below.
Re-presented1
2024
2023
2022
€m
€m
€m
Parent company
7
6
4
Subsidiaries
19
22
19
Audit fees2
26
28
23
Audit-related3
10
3
2
Non-audit fees
10
3
2
Total fees
36
31
25
Notes:
1 Audit fees of the parent company for the year ended 31 March 2023 have increased by €1 million compared to the amount previously reported. This is to include fees agreed during the year
ended 31 March 2024 relating to the year ended 31 March 2023.
2 Includes fees in connection with the interim review, preliminary announcement and controls audit required under Section 404 of the Sarbanes Oxley Act. In total this amounted to €1 million
in each of the years presented.
3 Fees for special purpose audits and statutory and regulatory filings during the year. Fees for the year ended 31 March 2024 are higher than fees for the comparative years, primarily due to
Reporting Accountant and audit services required in connection with the proposed merger of Vodafone UK and Three UK and the disposal of Vodafone Spain.
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4. Impairment losses
Impairment occurs when the carrying value of assets is greater than the present value of the net cash flows they are
expected to generate. We review the carrying value of assets for each country in which we operate at least annually. For
further details of our impairment review process see ‘Critical accounting judgements and key sources of estimation
uncertainty’ in note 1 ‘Basis of preparation’ to the consolidated financial statements.
Accounting policies
Goodwill
Goodwill is not subject to amortisation but is tested for impairment annually or whenever there is an indication that the asset may be impaired.
For the purpose of impairment testing, assets are grouped at the lowest levels for which there are separately identifiable cash flows, known as cash-
generating units. The determination of the Group’s cash-generating units is primarily based on the geographic area where the Group supplies
communications services and products. If cash flows from assets within one jurisdiction are largely independent of the cash flows from other assets
in that same jurisdiction and management monitors performance separately, multiple cash-generating units are identified within that geographic
area.
If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce
the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of
each asset in the unit. Impairment losses recognised for goodwill are not reversible in subsequent periods.
The recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset for which the estimates of future cash flows have not been adjusted.
Management prepares formal five year plans for the Group’s cash-generating units, which are the basis for the value in use calculations.
Property, plant and equipment, finite lived intangible assets and equity accounted investments
At each reporting period date, the Group reviews the carrying amounts of its property, plant and equipment, finite lived intangible assets and equity-
accounted investments to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication
exists, the recoverable amount of the asset is estimated in order to determine the extent, if any, of the impairment loss. Where it is not possible to
estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset
belongs.
If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or
cash-generating unit is reduced to its recoverable amount and an impairment loss is recognised immediately in the Consolidated income
statement.
Where there has been a change in the estimates used to determine recoverable amount and an impairment loss subsequently reverses, the carrying
amount of the asset or cash-generating unit is increased to the revised estimate of its recoverable amount, not to exceed the carrying amount that
would have been determined had no impairment loss been recognised for the asset or cash-generating unit in prior years and an impairment loss
reversal is recognised immediately in the consolidated income statement.
Impairment review
Following our annual impairment review, no impairments were recognised for any cash-generating units within the Group’s continuing operations in
the current year. Refer to note 7 for cash-generating units recognised as 'Discontinued operations and assets held for sale' in the current year.
The Group recognised a reversal of the prior year impairment of €64 million in the consolidated income statement within operating profit relating to
our investment in Indus Towers. Further detail on events that led to the recognition of this reversal is included on page 155.
Goodwill
The remaining carrying value of goodwill at 31 March was as follows:
2024
2023
€m
€m
Germany
20,335
20,335
Italy
–
2,481
Other
4,621
4,799
24,956
27,615
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Notes to the consolidated financial statements (continued)
4. Impairment losses (continued)
Key assumptions used in the value in use calculations
The key assumptions used in determining the value in use are:
Assumption
How determined
Projected adjusted
EBITDAaL
Projected adjusted EBITDAaL has been based on past experience adjusted for the following:
- In Europe, mobile revenue is expected to benefit from increased usage as customers transition to higher data
bundles, and new consumer and business products and services are introduced. Fixed revenue is forecast to
grow as penetration is increased and more products and services are sold to customers;
- Outside of Europe, revenue is expected to continue to grow as the penetration of faster data-enabled devices
rises along with higher data bundle attachment rates, and new products and services are introduced; and
- Margins are expected to be impacted by negative factors such as the cost of acquiring and retaining customers
in increasingly competitive markets and by positive factors such as the efficiencies expected from the
implementation of Group initiatives.
Projected capital
expenditure
The cash flow forecasts for capital expenditure are based on past experience and include the ongoing capital
expenditure required to maintain our networks, provide products and services in line with customer expectations,
including of higher data volumes and speeds, and to meet the population coverage requirements of certain of the
Group’s licences. In Europe, capital expenditure is required to roll out capacity-building next generation 5G and
gigabit networks. Outside of Europe, capital expenditure will be required for the continued rollout of current and
next generation mobile networks in emerging markets. Capital expenditure includes cash outflows for the
purchase of owned property, plant and equipment and computer software.
Projected licence and
spectrum payments
To enable the continued provision of products and services, the cash flow forecasts for licence and spectrum
payments for each relevant cash-generating unit include amounts for expected renewals and newly available
spectrum. Beyond the five year forecast period, a long-run cost of spectrum is assumed.
Long-term growth rate
For the purposes of the Group’s value in use calculations, a long‑term growth rate into perpetuity is applied
immediately at the end of the five year forecast period and is based on the lower of:
- the nominal GDP growth rate forecasts for the country of operation; and
- the long-term compound annual growth rate in adjusted EBITDAaL as estimated by management.
Long-term compound annual growth rates determined by management may be lower than forecast nominal GDP
growth rates due to the following market-specific factors: competitive intensity levels, maturity of business,
regulatory environment or sector-specific inflation expectations.
Pre-tax discount rate
The pre-tax discount rate for each cash-generating unit is derived such that when applied to pre-tax cash flows it
gives the same result as when the observable post-tax weighted average cost of capital is applied to post-tax cash
flows.
The assumptions used to develop discount rates for each cash-generating unit are benchmarked to externally
available data.
- The risk free rate is derived from an average yield of a ten year bond issued by the government in each cash-
generating unit’s respective country of operations;
- The forward-looking equity market risk premium (an investor’s required rate of return over and above a risk free
rate) is based on studies by independent economists, the long-term average equity market risk premium and
the market risk premiums typically used by valuation practitioners;
- The asset beta reflecting the systematic risk of the telecommunications segment relative to the market as a
whole is determined from betas observed for comparable listed telecommunications companies; and
- The region-specific leverage ratios are estimated from ratios observed for comparable listed
telecommunications companies.
Each cash-generating unit’s discount rate is determined in nominal terms in order to match their nominal
estimates of future cash flows.
Higher risk free interest rates and lower asset betas have, respectively, increased and decreased the cash-
generating unit discount rates in the current year.
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Year ended 31 March 2024
The Group performs its annual impairment test for goodwill and indefinite lived intangible assets at 31 March and when there is an indicator of
impairment of an asset. At each reporting period date, judgement is exercised by management in determining whether any internal or external
sources of information observed are indicative that the carrying amount of any of the Group’s cash generating units is not recoverable. Refer to note
7 for cash-generating units recognised as 'Discontinued operations and assets held for sale' in the current year.
Climate change
As a large owner of infrastructure and consumer of energy, the Group has exposure to climate change related risks such as energy cost increases,
asset damage and service disruption. The long range plans used in the Group’s impairment testing include forecast energy costs and other costs
that are embedded in the planning process to deliver the Group’s zero carbon targets. The long range plans also include capital expenditure in
relation to the Group’s use of durable and energy efficient infrastructure and the costs of the Group’s extensive and ongoing network maintenance
programme. Climate change has not had a material impact on the outcome of the Group’s impairment testing.
Indus Towers Limited
Management determines the recoverable amount of the Group’s investment in Indus Towers on a fair value less costs to sell basis. Indus Towers’
share price is observable in a quoted market and is considered a level 1 input under the IFRS 13 fair value hierarchy. The share price of INR 291.15
per share implied a recoverable amount of INR 165 billion (€1.8 billion), which exceeds the carrying value of the Group’s investment at the same
date. The increase in recoverable amount supports the reversal of the prior year impairment of €64 million.
Value in use assumptions
The table below shows key assumptions used in the value in use calculation for Germany as its carrying amount of goodwill is significant in
comparison with the Group’s total carrying amount of goodwill:
Assumptions used in value in use
calculations
Germany
%
Pre-tax discount rate
8.3
Long-term growth rate
1.0
Projected adjusted EBITDAaL CAGR1
2.4
Projected capital expenditure2
17.4-19.9
Sensitivity analysis
The estimated recoverable amounts of the Group’s operations in Germany and the UK exceed their carrying values by €2.3 billion and €1.6 billion
respectively. If the assumptions used in the impairment review were changed to a greater extent than as presented in the following table, the
changes would, in isolation, lead to an impairment loss being recognised for the year ended 31 March 2024.
Change required for carrying value to equal recoverable amount
Germany
UK
pps
pps
Pre-tax discount rate
0.5
2.2
Long-term growth rate
(0.4)
(2.1)
Projected adjusted EBITDAaL CAGR1
(1.2)
(2.9)
Projected capital expenditure2
3.9
4.9
Notes:
1 Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing.
2 Projected capital expenditure, which excludes licences and spectrum, is expressed as capital expenditure as a percentage of revenue in the initial five years for all cash-generating units of the
plans used for impairment testing.
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Notes to the consolidated financial statements (continued)
4. Impairment losses (continued)
Year ended 31 March 2023
The disclosures below for the year ended 31 March 2023 are as previously disclosed in the 31 March 2023 Annual Report.
The Group performs its annual impairment test for goodwill and indefinite lived intangible assets at 31 March and when there is an indicator of
impairment of an asset. At each reporting period date judgement is exercised by management in determining whether any internal or external
sources of information observed are indicative that the carrying amount of any of the Group’s cash generating units is not recoverable.
Climate change
As a large owner of infrastructure and consumer of energy, the Group has exposure to climate change related risks such as energy cost increases,
asset damage and service disruption. The long range plans used in the Group’s impairment testing include forecast energy costs and other costs
that are embedded in the planning process to deliver the Group’s zero carbon targets. The long range plans also include capital expenditure in
relation to the Group’s use of durable and energy efficient infrastructure and the costs of the Group’s extensive and ongoing network maintenance
programme. Climate change has not had a material impact on the outcome of the Group’s impairment testing.
Indus Towers Limited
The Group’s investment in Indus Towers was tested for impairment at 31 March 2023 following a decline in Indus Towers’ quoted share price in the
current year. Management concluded that fair value less costs to sell is the appropriate basis to determine the recoverable amount of the Group’s
investment. Indus Towers’ share price is observable in a quoted market and is considered a level 1 input under the IFRS 13 fair value hierarchy. The
share price of INR 143.00 per share implied a recoverable amount of INR 81 billion (€0.9 billion) which was lower than the carrying value of the
investment at the same date. An impairment charge of €64 million was recognised to reduce the carrying value of the Group’s investment to the
recoverable amount in the Group’s consolidated statement of financial position.
Value in use assumptions
The table below shows key assumptions used in the value in use calculations, and separately presented cash-generating units for which the carrying
amount of goodwill is significant in comparison with the Group’s total carrying amount of goodwill:
Assumptions used in value in use
calculations
Germany
Italy
%
%
Pre-tax discount rate
7.8
8.9
Long-term growth rate
0.6
1.5
Projected adjusted EBITDAaL CAGR1
1.8
1.0
Projected capital expenditure2
19.4-19.8
16.5-17.9
Sensitivity analysis
The estimated recoverable amounts of the Group’s operations in Germany, Italy, the UK, and Spain exceed their carrying values by €3.2 billion, €0.2
billion, €1.3 billion, and €0.4 billion respectively. If the assumptions used in the impairment review were changed to a greater extent than as
presented in the following table, the changes would, in isolation, lead to an impairment loss being recognised for the year ended 31 March 2023.
Change required for carrying value to equal recoverable amount
Germany
Italy
UK
Spain
pps
pps
pps
pps
Pre-tax discount rate
0.6
0.2
1.6
0.5
Long-term growth rate
(0.6)
(0.2)
(1.9)
(0.6)
Projected adjusted EBITDAaL CAGR1
(1.8)
(0.5)
(4.1)
(1.5)
Projected capital expenditure2
5.5
0.9
4.2
2.2
Notes:
1 Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing.
2 Projected capital expenditure, which excludes licences and spectrum, is expressed as capital expenditure as a percentage of revenue in the initial five years for all cash-generating units of the
plans used for impairment testing.
For the Group’s operations in Italy and Spain management has prepared the following sensitivity analysis for changes in pre-tax discount rate and
projected adjusted EBITDAaL CAGR1 assumptions. The associated impact of the change in each key assumption does not consider any
consequential impact on other assumptions used in the impairment review.
Recoverable amount less carrying value
Italy
Spain
€bn
€bn
Base case as at 31 March 2023
0.2
0.4
Change in pre-tax discount rate
Decrease by 1pps
1.4
1.3
Increase by 1pps
(0.8)
(0.3)
Change in projected adjusted EBITDAaL CAGR1
Decrease by 5pps
(1.6)
(0.8)
Increase by 5pps
2.3
1.8
Note:
1 Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing.
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Year ended 31 March 2022
The disclosures below for the year ended 31 March 2022 are as previously disclosed in the 31 March 2022 Annual Report.
The Group performs its annual impairment test for goodwill and indefinite lived intangible assets at 31 March and when there is an indicator of
impairment of an asset. At each reporting period date judgement is exercised by management in determining whether any internal or external
sources of information observed are indicative that the carrying amount of any of the Group’s cash-generating units is not recoverable.
As a large owner of infrastructure and consumer of energy, the Group has exposure to climate change related risks such as energy cost increases,
asset damage and service disruption. The long range plans used in the Group’s impairment testing include forecast energy costs and other costs
that are embedded in the planning process to deliver the Group’s zero carbon targets. The long range plans also include capital expenditure in
relation to the Group’s use of durable and energy efficient infrastructure and the costs of the Group’s extensive and ongoing network maintenance
programme. Furthermore, the Group will continue to develop strong reactive initiatives to manage the unpredictable impacts of future climate-
related risks. Climate change, therefore, has not had a material impact on the outcome of the Group’s impairment testing and the Group will
continue to refine its approach to modelling climate-related risks and opportunities in the value in use calculations.
As the war in Ukraine continues, it is challenging to predict the full extent and duration of its impact on the economy and the Group’s businesses.
However, to assess a potential impact of this on the Group’s impairment testing, management prepared scenario analysis based on adjustments to
the long range plans for high level estimates of market risks impacted by the war. This analysis did not indicate a risk of impairment at 31 March
2022. Management will update the cash flows and assumptions used in the Group’s impairment testing at future reporting dates with latest best
estimates.
No impairments were recognised for the Group’s cash-generating units during the year to 31 March 2022.
Value in use assumptions
The table below shows key assumptions used in the value in use calculations, and separately presented cash-generating units for which the carrying
amount of goodwill is significant in comparison with the Group’s total carrying amount of goodwill:
Assumptions used in value in use calculations
Germany
Italy
Vantage Towers
Germany
Other
%
%
%
%
Pre-tax discount rate
7.4
9.3
6.1
6.2-22.5
Long-term growth rate
0.5
1.5
1.5
1.0-8.9
Projected adjusted EBITDAaL CAGR1
(0.1)
(0.2)
11.0
(5.4)-13.0
Projected capital expenditure2
19.6-21.8
15.0-16.3
32.0-62.1
10.0-51.4
Notes:
1 Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing. For the
purposes of this disclosure, Italy’s adjusted EBITDAaL for the year ended 31 March 2022 excludes the TIM settlement.
2 Projected capital expenditure, which excludes licences and spectrum, is expressed as capital expenditure as a percentage of revenue in the initial five years for all cash-generating units of the
plans used for impairment testing.
Sensitivity analysis
The estimated recoverable amounts of the Group’s operations in Germany, Italy, the UK and Spain exceed their carrying values by €7.3 billion, €0.4
billion, €1.3 billion and €0.1 billion respectively. However, if the assumptions used in the impairment review were changed to a greater extent than
as presented in the following table, the changes would, in isolation, lead to an impairment loss being recognised for the year ended 31 March 2022.
Change required for carrying value to equal recoverable amount
Germany
Italy
UK
Spain
pps
pps
pps
pps
Pre-tax discount rate
1.4
0.3
1.3
0.1
Long-term growth rate
(1.4)
(0.3)
(1.5)
(0.1)
Projected adjusted EBITDAaL CAGR1
(4.1)
(0.9)
(3.1)
(0.4)
Projected capital expenditure2
12.6
1.8
4.3
0.5
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Notes to the consolidated financial statements (continued)
4. Impairment losses (continued)
For the Group’s operations in Germany, Italy, the UK and Spain management has considered the following reasonably possible changes in pre-tax
discount rate, long-term growth rate and projected adjusted EBITDAaL CAGR1 assumptions, leaving all other assumptions unchanged. The
sensitivity analysis presented is prepared on the basis that the reasonably possible change in each key assumption would not have a consequential
impact on other assumptions used in the impairment review. The associated impact on the impairment assessment is presented in the table below.
Management has concluded that no reasonably possible or foreseeable change in projected capital expenditure2 would cause the difference
between the carrying value and recoverable amount for any cash generating unit to be materially different to the base case disclosed below.
Recoverable amount less carrying value
Germany
Italy
UK
Spain
€bn
€bn
€bn
€bn
Base case as at 31 March 2022
7.3
0.4
1.3
0.1
Change in pre-tax discount rate
Decrease by 1pps
14.9
1.7
2.8
1.0
Increase by 1pps
1.7
(0.7)
0.3
(0.6)
Change in long-term growth rate
Decrease by 1pps
1.6
(0.6)
0.4
(0.5)
Increase by 1pps
15.6
1.7
2.8
0.9
Change in projected adjusted EBITDAaL CAGR1
Decrease by 5pps
(1.4)
(1.6)
(0.7)
(1.1)
Increase by 5pps
17.9
2.8
3.8
1.5
Notes:
1 Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing. For the
purposes of this disclosure, Italy’s adjusted EBITDAaL for the year ended 31 March 2022 excludes the TIM settlement.
2 Projected capital expenditure, which excludes licences and spectrum, is expressed as capital expenditure as a percentage of revenue in the initial five years for all cash-generating units of the
plans used for impairment testing.
5. Investment income and financing costs
Investment income comprises interest received from short-term investments and other receivables. Financing costs
mainly arise from interest due on bonds and commercial paper issued, bank loans and the results of hedging
transactions used to manage foreign exchange and interest rate movements.
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Investment income
Financial assets measured at amortised cost
327
196
246
Financial assets measured at fair value through profit and loss
254
36
5
581
232
251
Financing costs
Financial liabilities measured at amortised cost
Bonds
1,596
1,711
1,546
Lease liabilities
440
355
320
Bank loans and other liabilities2
712
392
425
Interest on derivatives
(395)
(561)
(428)
Mark-to-market on derivatives
100
(423)
(341)
Financial assets measured at fair value through profit and loss
–
–
36
Foreign exchange
173
135
284
2,626
1,609
1,842
Net financing costs
2,045
1,377
1,591
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 Interest capitalised for the year ended 31 March 2024 was €nil (2023: €5 million, 2022: €17 million).
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6. Taxation
This note explains how our Group tax charge arises. The deferred tax section of the note also provides information on
our expected future tax charges and sets out the tax assets held across the Group together with our view on whether or
not we expect to be able to make use of these in the future.
Accounting policies
Income tax expense represents the sum of current and deferred taxes.
Current tax payable or recoverable is based on taxable profit for the year. Taxable profit differs from profit as reported in the consolidated income
statement because some items of income or expense are taxable or deductible in different years or may never be taxable or deductible. The Group’s
liability for current tax is calculated using tax rates and laws that have been enacted or substantively enacted by the reporting period date.
The Group recognises provisions for uncertain tax positions when the Group has a present obligation as a result of a past event and management
judge that it is probable that there will be a future outflow of economic benefits from the Group to settle the obligation. Uncertain tax positions are
assessed and measured on an issue by issue basis within the jurisdictions that we operate either using management’s estimate of the most likely
outcome where the issues are binary, or the expected value approach where the issues have a range of possible outcomes. The Group recognises
interest on late paid taxes as part of financing costs, and, if applicable, classifies tax penalties as part of the income tax expense if the penalties are
based on profits.
Deferred tax is the tax expected to be payable or recoverable in the future arising from temporary differences between the carrying amounts of
assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. It is accounted for using
the statement of financial position liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and
deferred tax assets are recognised to the extent that it is probable that temporary differences or taxable profits will be available against which
deductible temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary difference, or net temporary difference in a transaction that gives rise to both taxable
and deductible temporary differences, arising from the initial recognition (other than in a business combination) of assets and liabilities in a
transaction that affects neither the taxable profit nor the accounting profit. Deferred tax liabilities are not recognised to the extent they arise from
the initial recognition of non-tax deductible goodwill.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint
arrangements, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference
will not reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each reporting period date and adjusted to reflect changes in the Group’s assessment that
sufficient taxable profits will be available to allow all of the recognised asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the periods when the liability is settled or the asset realised, based on tax rates
that have been enacted or substantively enacted by the reporting period date.
Tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they
either relate to income taxes levied by the same taxation authority on either the same taxable entity or on different taxable entities which intend to
settle the current tax assets and liabilities on a net basis.
Tax is charged or credited to the income statement, except when it relates to items charged or credited to other comprehensive income or directly
to equity, in which case the tax is recognised in other comprehensive income or in equity.
Income tax expense
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
United Kingdom corporation tax expense:
Current year
70
4
22
Adjustments in respect of prior years
1
4
17
71
8
39
Overseas current tax expense/(credit):
Current year
670
924
975
Adjustments in respect of prior years
25
(26)
78
695
898
1,053
Total current tax expense
766
906
1,092
Deferred tax on origination and reversal of temporary differences:
United Kingdom deferred tax
(36)
(71)
(791)
Overseas deferred tax
(680)
(343)
1,260
Total deferred tax (credit)/expense
(716)
(414)
469
Total income tax expense
50
492
1,561
Note:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
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Notes to the consolidated financial statements (continued)
6. Taxation (continued)
Tax (credited)/charged directly to other comprehensive income
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Current tax
2
3
–
Deferred tax
(579)
305
638
Total tax (credited)/charged directly to other comprehensive income
(577)
308
638
Tax charged directly to equity
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Deferred tax
4
7
–
Total tax charged directly to equity
4
7
–
Factors affecting the tax expense for the year
The table below explains the differences between the expected tax expense, being the aggregate of the Group’s geographical split of
profits multiplied by the relevant local tax rates and the Group’s total tax expense for each year.
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Continuing profit before tax as shown in the consolidated income statement
1,620
13,074
4,149
Profit at weighted average statutory tax rate
363
2,787
1,298
Impairment loss with no tax effect
–
18
–
Disposal of Group investments2
174
(1,718)
(8)
Effect of taxation of associates and joint ventures, reported within profit before tax
23
(125)
(111)
Deferred tax (credit)/charge following revaluation of investments in Luxembourg
–
(393)
1,455
Previously unrecognised temporary differences and losses we expect to use in the future3
(1,021)
(16)
(708)
Previously recognised temporary differences and losses we no longer expect to use in the
future
–
–
74
Current year temporary differences (including losses) that we currently do not expect to use
84
81
28
Adjustments in respect of prior year tax liabilities
89
(29)
10
Impact of tax credits and irrecoverable taxes
147
80
73
Deferred tax on overseas earnings
1
(6)
2
Effect of current year changes in statutory tax rates on deferred tax balances4
(19)
35
(667)
Financing costs and similar not deductible/(taxable) for tax purposes
214
(27)
46
Revaluation of assets for tax purposes in Turkey and Italy5
(65)
(338)
(84)
Expenses not deductible for tax purposes
60
143
153
Income tax expense
50
492
1,561
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 The amount for 2024 includes €110 million of tax relating to income of the continuing Group presented in Discontinued Operations, €37 million in relation to the disposal of M-Pesa Holding
Company Limited and €30 million in relation to the Vantage Towers disposal. The amount for 2023 relates to the disposal of Vantage Towers into a joint venture and the tax exempt
disposals of Vodafone Hungary and Vodafone Ghana. See note 27 ‘Acquisitions and disposals’.
3 The amount in 2024 includes €1,019 million of additional losses recognised in Luxembourg (see below).
4 The amount for 2022 includes the increase in future UK tax rate to 25%.
5 The amounts for 2024 and 2023 relate to inflation adjustments in Turkey. The amount for 2022 relates to step up of assets for tax purposes in Italy and Turkey.
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Deferred tax
Analysis of movements in the net deferred tax asset balance during the year:
2024
2023
€m
€m
1 April
18,545
18,569
Adjustment relating to assets Held for Sale
(422)
–
Foreign exchange movements
(32)
(59)
Credited to the income statement1
716
425
Charged directly to OCI
579
(304)
Charged directly to equity
(4)
(6)
Indexation of the opening balance in respect of hyperinflation
96
(191)
Arising on acquisitions and disposals
–
111
31 March
19,478
18,545
Deferred tax assets and liabilities, before offset of balances within countries, are as follows:
Amount
Net
credited/
recognised
(expensed)
Gross
Gross
Less
deferred tax
in income
deferred
deferred tax
amounts
asset/
statement
tax asset
liability
unrecognised
(liability)
€m
€m
€m
€m
€m
Tangible assets
(176)
2,656
(1,174)
10
1,492
Intangible assets
354
367
(1,177)
11
(799)
Tax losses
455
32,830
–
(14,051)
18,779
Treasury related items
19
594
(138)
(569)
(113)
Temporary differences relating to revenue recognition
(61)
2
(677)
–
(675)
Temporary differences relating to leases
(16)
1,576
(1,354)
–
222
Other temporary differences
141
892
(306)
(14)
572
31 March 20242
716
38,917
(4,826)
(14,613)
19,478
Analysed in the balance sheet, after offset of balances within countries, as:
€m
Deferred tax asset
20,177
Deferred tax liability
(699)
31 March 20242
19,478
At 31 March 2023, deferred tax assets and liabilities, before offset of balances within countries, were as follows:
Amount
Net
credited/
recognised
(expensed)
Gross
Gross
Less
deferred tax
in income
deferred
deferred tax
amounts
asset/
statement
tax asset
liability
unrecognised
(liability)
€m
€m
€m
€m
€m
Tangible assets
136
2,761
(1,426)
(47)
1,288
Intangible assets
324
630
(1,495)
15
(850)
Tax losses
(78)
28,035
–
(9,540)
18,495
Treasury related items
2
623
(717)
(588)
(682)
Temporary differences relating to revenue recognition
(40)
19
(705)
–
(686)
Temporary differences relating to leases
216
1,482
(1,054)
(30)
398
Other temporary differences
(135)
938
(296)
(60)
582
31 March 20232
425
34,488
(5,693)
(10,250)
18,545
At 31 March 2023, analysed in the balance sheet, after offset of balances within countries, as:
€m
Deferred tax asset
19,316
Deferred tax liability
(771)
31 March 20232
18,545
Notes:
1 €11 million in the year ended 31 March 2023 is in relation to discontinued operations
2 The Group does not discount deferred tax assets. This is in accordance with IAS 12.
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Notes to the consolidated financial statements (continued)
6. Taxation (continued)
Factors affecting the tax charge in future years
The Group’s future tax charge, and effective tax rate, could be affected by several factors including tax reform in countries around the world,
including any arising from the OECD’s or European Commission’s work on the taxation of the digital economy and European Commission initiatives
such as the Minimum Tax directive, Business in Europe: Framework for Income Taxation ‘BEFIT’ or as a consequence of state aid investigations,
future corporate acquisitions and disposals, any restructuring of our businesses and the resolution of open tax issues (see below).
The Group is routinely subject to audit by tax authorities in the territories in which it operates. The Group considers each issue on its merits and,
where appropriate, holds provisions in respect of the potential tax liability that may arise. As at 31 March 2024, the Group holds provisions for such
potential liabilities of €445 million (2023: €412 million). These provisions relate to multiple issues across the jurisdictions in which the Group
operates.
As the tax impact of a transaction can be uncertain until a conclusion is reached with the relevant tax authority or through a legal process, the
amount ultimately paid may differ materially from the amount accrued and could therefore affect the Group's overall profitability and cash flows in
future periods. See note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements.
The tables below present the gross amount and expiry dates of losses available for carry forward for the year ended 31 March 2024 and the
comparative year ended 31 March 2023.
Expiring
Expiring
within
beyond
31 March 2024
5 years
6 years
Unlimited
Total
€m
€m
€m
€m
Losses for which a deferred tax asset is recognised
20
–
80,224
80,244
Losses for which no deferred tax is recognised
313
15,653
40,378
56,344
333
15,653
120,602
136,588
Expiring
Expiring
within
beyond
31 March 2023
5 years
6 years
Unlimited
Total
€m
€m
€m
€m
Losses for which a deferred tax asset is recognised
15
59
78,967
79,041
Losses for which no deferred tax is recognised
306
15,649
18,321
34,276
321
15,708
97,288
113,317
Deferred tax assets on losses in Luxembourg
Included in the table above are losses of €67,016 million (2023: €65,232 million) that have arisen in Luxembourg companies. A deferred tax asset of
€16,714 million (2023: €16,269 million) has been recognised in respect of these losses, as we conclude it is probable that the Luxembourg entities
will continue to generate taxable profits in the future against which we can utilise these losses. These tax losses principally arose from historical
impairments, primarily following the acquisition of the Mannesmann Group in 2000. These losses also arose prior to the 2017 tax reform in
Luxembourg and are available to carry forward indefinitely.
Losses incurred after the 2017 tax reform in Luxembourg, expire after 17 years and can only be used after any pre-existing losses on a first-in-first-
out basis. The Luxembourg companies have €15,933 million (2023; €15,925 million) of post-2017 losses, which will fully expire in 16 years. No
deferred tax asset is recognised for these post-2017 losses on the basis that they are not forecast to be used prior to the expiry of their 17 year life.
We also have €9,136 million (2023: €9,136 million) of Luxembourg losses in a former Cable & Wireless Worldwide Group company, for which no
deferred tax asset has been recognised as it is uncertain whether these losses will be utilised.
In the year ended 31 March 2024, the Luxembourg companies recognised an additional €1,019 million deferred tax asset relating to losses arising
pre-2017, as a result of favourable case law during the year. The Luxembourg companies utilised €2,393 million of their pre-2017 losses in the
current year, representing €598 million of the deferred tax asset and 3.6% of the recognised deferred tax asset. The recognition of the €1,019
million additional deferred tax asset has a significant impact on reducing our total tax charge and effective tax rate for the year but is a deferred tax
impact and has no immediate cash-tax impact.
Following restructuring in December 2022, which saw the Luxembourg companies dispose of their investments in the Group’s non-Luxembourg
operating companies, the profits and losses in Luxembourg are no longer expected to be significantly impacted by changes in the value of the
Luxembourg companies’ investments. The recovery of the deferred tax asset is expected to be driven by the recurring profits of the Luxembourg
companies.
These recurring profits are derived from the Group’s internal financing, centralised procurement, and international roaming activities. These
activities have consistently generated taxable profits of over €1 billion per annum throughout their existence. The Group has reviewed the latest
five-year forecasts for the Luxembourg companies, including their ability and the Group’s intention to continue to generate income beyond this
period. The forecasts consider the impact of the current market conditions on the existing financing activities, including the current view of future
interest rates, levels of intragroup financing, as well as the future profits generated from the procurement and roaming activities.
This assessment also included a review of the commercial structures supporting the profits generated from these activities and considered the
factors, under the Group’s control, which could impact the ability of these activities to generate taxable profits. We have assessed that the current
structure continues to be sustainable under the tax laws substantively enacted at the reporting period date and the Group’s intentions to keep these
activities in Luxembourg remains unchanged.
Based on the current forecasts, €3,306 million (20%) (2023: €4,518 million) of the deferred tax asset is forecast to be used within the next 10 years,
and €6,344 million (38%) (2023: €8,742 million) used within 20 years. The losses are projected to be fully utilised over the next 52 to 57 years
(2023: 35 to 39 years).
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The increase in the recovery period over the prior year is principally a result of lower forecast interest rates, driving margins down on existing
financing activities, and lower internal financing income as the Group right-sizes its portfolio which includes the Group’s announcement of
agreements to sell its operations in Spain and Italy. An increase or decrease in the forecast income in Luxembourg in each year of 5%-10% would
change the period over which the losses will be fully utilised by 3 to 6 years either way. The Group uses different scenarios to forecast income to
understand the impact that a change in interest rates or level of debt advanced by the Luxembourg companies could have on the recovery period of
the losses.
The Group does not currently recognise deferred tax assets which are forecast to be used 60 years beyond the reporting period date.
Any future changes in tax law or the structure of the Group could have a significant effect on the use of the Luxembourg losses, including the period
over which these losses can be utilised. On the basis that future changes in tax laws are unknown, the profit forecasts assume that existing tax laws
continue.
Based on the above factors the Group concludes that it is probable that the Luxembourg companies will continue to generate taxable profits in the
future against which it will use these losses.
Deferred tax assets in the UK
The Group has a recognised deferred tax asset in the UK totalling €2,485 million (2023: €1,809 million) which consists primarily of excess
capital allowances, which can be claimed on a reducing balance basis. The net deferred tax asset has increased in 2024, primarily due to a
€574 million reduction in an offsetting deferred tax liability in relation to mark-to-market movements on cash-flow hedging in Vodafone
Group Plc. The UK tax group consists of the UK operating company along with Common Functions and Group Treasury. The Group has
reviewed the latest forecasts for the UK business which incorporate the inherent risks of operating in the telecommunications business. In the
period beyond the 5-year forecast we have reviewed the profits inherent in the terminal period and based on these and our expectations for
the UK business we believe there should be sufficient taxable profits to utilise 90% of the deferred tax asset balance within 18 years, and 99%
within 27 years.
The Group has losses amounting to €29,713 million (2023: €2,377 million) in respect of UK subsidiaries which are only available for offset against
future capital gains and, due to the UK Substantial Shareholding Exemption rules, we do not believe it is probable we will utilise these losses such
that no deferred tax asset has been recognised, as in the prior year.
The amount of capital losses grew significantly in 2024 as a result of the strike-off of a number of entities. The entities struck-off consisted of certain
holding companies involved in historical M&A activities, such as Vodafone’s acquisition of the Mannesmann Group in 2000. The remaining losses
relate to a number of other jurisdictions across the Group. There are also €2,941 million (2023: €2,443 million) of unrecognised temporary
differences relating to treasury and other items.
Deferred tax assets on losses in Germany
The Group has a recognised deferred tax assets of €2,029 million (2023: €2,021 million) in Germany in respect of losses arising primarily on the write
down of investments in Germany in 2000. The losses relate to German corporate tax and trade tax liabilities and they do not expire. The Group
concluded it is probable that the German business will generate sufficient taxable profits in the future against which we can utilise these losses. The
Group has reviewed the latest five -year forecasts for the German business, and the inherent risks of operating in the telecommunications business.
In the period beyond the 5-year forecast, the Group has also specifically taken into consideration the implications of the Growth Opportunities Act,
substantively enacted in March 2024, which introduces new interest restriction rules applying to both corporate and trade tax, but also an increase
in permitted loss utilisation against corporate tax. In combination, these two changes will increase taxable profits against accounting profits and
increase loss utilisation. We expect to fully utilise the trade tax losses within 5-6 years, and corporate tax losses within 12-13 years.
Deferred tax assets in Italy
The Group has a deferred tax asset of €462 million (2023: €425 million), including €295 million (2023: €152 million) relating to tax losses in Italy,
which is recognised as part of the held for sale assets and the value at the completion date will transfer with the business.
In assessing the recognition position for Italy, the Group has reviewed the latest forecasts for the Italian business which incorporate the
unsystematic risks of operating in the telecommunications business. In the period beyond the 5-year forecast we have reviewed the profits inherent
in the terminal period and based on these and our expectations for the Italian business we believe it is probable the Italian losses will be fully utilised.
Deferred tax assets in Spain
The Group recognises deferred tax assets in Spain up to the extent of deferred tax liabilities, with gross unrecognised losses of €5,504 million (2023:
€5,130 million). The net €3 million deferred tax liability is recognised as part of the held for sale assets and the value (along with the amount of
unrecognised losses) at the completion date will transfer with the business.
Impact of climate risks
The recovery of the Group’s deferred tax assets is dependent on its forecasts of future profitability and the climate related risks have been
considered in the Group’s assessment of the recovery of those assets (see note 4 ‘Impairment losses’). The Group does not expect the climate
related risks to have an impact on the ability of Luxembourg to continue to provide the internal financing, procurement, and roaming activities to
other members of the Group.
Unremitted earnings
No deferred tax liability has been recognised in respect of a further €38,380 million (2023: €26,371 million) of unremitted earnings of subsidiaries
because the Group is able to control the timing of the reversal of the temporary difference, and it is probable that such differences will not reverse in
the foreseeable future. It is not practicable to estimate the amount of unrecognised deferred tax liabilities in respect of these unremitted earnings.
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Notes to the consolidated financial statements (continued)
6. Taxation (continued)
Pillar Two - Global Minimum Tax
On 20 June 2023, the UK substantively enacted the Pillar Two global minimum tax model rules (the “Pillar Two” rules) of the OECD’s Inclusive
Framework on Base Erosion and Profit Shifting (’BEPS’). The legislation took effect for financial years commencing on or after 1 January 2024,
making it effective for the Vodafone Group from 1 April 2024. Under these rules, a top-up tax will arise where the effective tax rate of the Group’s
operations in any individual jurisdiction, calculated using principles set out in the Pillar Two legislation, is below 15%. Any resulting tax would be
payable by Vodafone Group Plc to the UK tax authority (HMRC) being the Group’s ultimate parent.
As a consequence of the Pillar Two rules, many national governments have enacted (or announced the imminent introduction of) domestic
minimum tax rules that are closely aligned to the OECD’s Pillar Two model rules. Where such domestic minimum tax rules are in place, they should
raise local tax obligations to the 15% minimum rate, thereby eliminating the top-up tax liability otherwise payable by Vodafone Group Plc under the
UK’s Pillar Two rules. Vodafone monitors the implementation of such domestic minimum tax rules to ensure compliance with all filing obligations.
We have performed an assessment of the Group’s potential exposure to Pillar Two rules based on financial information for the years ended 31 March
2023 and 31 March 2024 and simulated the transitional Safe harbour tests set out by the OECD based on our Country-by-Country reporting data
and our consolidated financial statements for 2021, 2022, 2023.
According to this assessment, Vodafone should meet one or more Safe harbour tests in the majority of the jurisdictions in which we operate. The
Pillar Two effective tax rates in most of the jurisdictions in which the Group operates are above 15%. We estimate that the combined impact of
countries implementing qualified domestic minimum top-up taxes and the income inclusion rule in the UK will result in an estimated €9-14 million
additional tax per annum, which will not have a significant impact on the Group's Adjusted Effective Tax Rate (‘AETR’).
7. Discontinued operations and assets held for sale
The Group classifies certain of its assets that it expects to dispose as either discontinued operations or as held for sale.
The Group classifies non-current assets and assets and liabilities within disposal groups (‘assets’) as held for sale if the assets are available
immediately for sale in their present condition, management is committed to a plan to sell the assets under usual terms, it is highly probable that
their carrying amounts will be recovered principally through a sale transaction rather than through continuing use and the sale is expected to be
completed within one year from the date of the initial classification.
Assets and liabilities classified as held for sale are presented separately as current items in the consolidated statement of financial position and are
measured at the lower of their carrying amount and fair value less costs to sell. Property, plant and equipment and intangible assets are not
depreciated or amortised once classified as held for sale. Similarly, equity accounting ceases for associates and joint ventures held for sale.
Where operations constitute a separately reportable segment (see note 2 ‘Revenue disaggregation and segmental analysis’) and have been
disposed of, or are classified as held for sale, the Group classifies such operations as discontinued.
Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from
discontinued operations in the Consolidated income statement. Discontinued operations are also excluded from segment reporting. All other notes
to the Consolidated financial statements include amounts for continuing operations, unless indicated otherwise.
Transactions between the Group's continuing and discontinued operations are eliminated in full in the Consolidated income statement. To the
extent that the Group considers that the commercial relationships with discontinued operations will continue post-disposal, transactions are
reflected within continuing operations with an opposite charge or credit reflected within the results of discontinued operations resulting in a net nil
impact on the Group’s Profit for the financial year for the years presented.
Discontinued operations
On 31 October 2023, the Group announced that it had entered into binding agreements with Zegona Communications plc (’Zegona’) in relation to
the sale of 100% of Vodafone Holdings Europe, S.L.U. (‘Vodafone Spain’). The expected completion of the disposal is the first half of 2024.
On 15 March 2024, the Group announced that it had entered into a binding agreement with Swisscom AG (‘Swisscom’) in relation to the sale of
100% of Vodafone Italia S.p.A. (’Vodafone Italy’). The expected completion of the disposal is in the first half of 2025.
Consequently, the results of Vodafone Spain and Vodafone Italy are reported as discontinued operations and the assets and liabilities of both are
presented as held for sale in the consolidated statement of financial position.
A summary of the results of these discontinued operations is below.
2024
2023
2022
€m
€m
€m
(Loss)/profit for the financial year - Discontinued operations
Vodafone Spain
(5)
(340)
(352)
Vodafone Italy
(60)
93
537
Total
(65)
(247)
185
(Loss)/earnings per share - Discontinued operations
Basic
(0.24)c
(0.89)c
0.64c
Diluted
(0.24)c
(0.89)c
0.63c
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Segment analysis of discontinued operations
Vodafone Spain
The results of discontinued operations in Spain are detailed below.
2024
2023
2022
€m
€m
€m
Revenue
3,773
3,675
3,960
Cost of sales
(2,593)
(2,959)
(3,105)
Gross profit
1,180
716
855
Selling and distribution expenses
(259)
(314)
(328)
Administrative expenses
(435)
(575)
(772)
Net credit losses on financial assets
(120)
(35)
(115)
Other expense
–
(122)
–
Operating profit/(loss)
366
(330)
(360)
Investment income
29
16
2
Financing costs
(56)
(26)
(23)
Profit/(loss) before taxation
339
(340)
(381)
Income tax credit
1
–
29
Profit/(loss) after tax of discontinued operations
340
(340)
(352)
After tax loss on the re-measurement of disposal group
(345)
–
–
Loss for the financial year from discontinued operations
(5)
(340)
(352)
Total comprehensive expense for the financial year from discontinued operations
Attributable to owners of the parent
(5)
(340)
(352)
The consideration for Vodafone Spain is comprised of €4.1 billion cash to be paid on completion and non-cash consideration with a nominal value
of €0.9 billion. The non-cash consideration comprises Redeemable Preference Shares (‘RPS’) which will be issued to Vodafone by a newly created
entity, which will subscribe for new ordinary shares in Zegona for an amount, based on the issue price for Zegona's equity raise, that is equivalent to
the amount of RPS being subscribed for by Vodafone. The RPS will be redeemed 6 years after completion, or earlier following a material liquidity
event or exit for Zegona that releases funds to its shareholders. A proportion of the consideration is related to future services to be provided by the
Group to Zegona. For the year ended 31 March 2024, the Group recorded a non-cash charge of €345 million (pre and post-tax), included in
discontinued operations, as a result of the re-measurement of Vodafone Spain to its fair value less costs to sell. The charge mostly results from the
non-recognition of €538 million (pre and post-tax) depreciation and amortisation of non-current assets from the date Vodafone Spain was classified
as held for sale.
The fair value of the Group’s equity interest at 31 March 2024 was determined with reference to the consideration expected from the agreed sale to
Zegona less adjustments for estimated completion adjustments, consideration for future services to be received by Zegona from the Group and the
elimination of intercompany debt. This approach was considered to result in a level 2 valuation in accordance with IFRS 13 as certain estimated
completion adjustments and the fair value of the non-cash consideration, are not observable.
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Notes to the consolidated financial statements (continued)
7. Discontinued operations and assets held for sale (continued)
Vodafone Italy
The results of discontinued operations in Italy are detailed below.
2024
2023
2022
€m
€m
€m
Revenue
4,579
4,722
4,944
Cost of sales
(3,438)
(3,532)
(3,521)
Gross profit
1,141
1,190
1,423
Selling and distribution expenses
(244)
(238)
(276)
Administrative expenses
(760)
(710)
(671)
Net credit losses on financial assets
(51)
(66)
(42)
Other expense
–
(1)
(1)
Operating profit
86
175
433
Investment income
–
–
1
Financing costs
(86)
(93)
(99)
Profit before taxation
–
82
335
Income tax credit
23
11
202
Profit after tax of discontinued operations
23
93
537
After tax loss on the re-measurement of disposal group
(83)
–
–
(Loss)/profit for the financial year from discontinued operations
(60)
93
537
Total comprehensive (expense)/income for the financial year from discontinued
operations
Attributable to owners of the parent
(71)
80
537
The consideration for Vodafone Italy is comprised of €8 billion cash to be paid on completion. A proportion of the consideration is related to future
services to be provided by the Group to Swisscom. For the year ended 31 March 2024, the Group recorded a non-cash charge of €83 million (pre and
post-tax), included in discontinued operations, as a result of the re-measurement of Vodafone Italy to its fair value less costs to sell. The charge
mostly results from the non-recognition of €93 million (€67 million net of tax) depreciation and amortisation of non-current assets from the date
Vodafone Italy was classified as held for sale.
The fair value of the Group’s equity interest at 31 March 2024 was determined with reference to the consideration expected to be received from the
agreed sale to Swisscom, less adjustments for estimated completion adjustments, consideration for future services to be received by Swisscom
from the Group and the elimination of intercompany debt. This approach was considered to result in a level 2 valuation in accordance with IFRS 13
as, certain completion related adjustments and estimates of the value of the future services to be provided, are not observable.
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Assets held for sale
Assets and liabilities relating to Vodafone Spain and Vodafone Italy have been classified as held for sale in the consolidated statement of financial
position at 31 March 2024. The relevant assets and liabilities are detailed in the table below.
Vodafone Spain
Vodafone Italy
Total
€m
€m
€m
Non-current assets
Goodwill
–
2,398
2,398
Other intangible assets
987
3,331
4,318
Property, plant and equipment
4,957
4,307
9,264
Other investments
2
–
2
Deferred tax assets
–
461
461
Trade and other receivables
223
167
390
6,169
10,664
16,833
Current assets
Inventory
39
134
173
Taxation recoverable
–
77
77
Trade and other receivables
805
1,117
1,922
Cash and cash equivalents
13
29
42
857
1,357
2,214
Assets held for sale
7,026
12,021
19,047
Non-current liabilities
Borrowings
878
1,509
2,387
Deferred tax liabilities
3
–
3
Post employment benefits
–
45
45
Provisions
158
115
273
Trade and other payables
43
120
163
1,082
1,789
2,871
Current liabilities
Borrowings
346
673
1,019
Taxation liabilities
–
12
12
Provisions
23
67
90
Trade and other payables
1,203
1,723
2,926
1,572
2,475
4,047
Liabilities held for sale
2,654
4,264
6,918
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Notes to the consolidated financial statements (continued)
8. Earnings per share
Basic earnings per share is the amount of profit generated for the financial year attributable to equity shareholders
divided by the weighted average number of shares in issue during the year.
2024
2023
2022
Millions
Millions
Millions
Weighted average number of shares for basic earnings per share
27,056
27,680
29,012
Effect of dilutive potential shares: restricted shares and share options
95
95
97
Weighted average number of shares for diluted earnings per share
27,151
27,775
29,109
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Profit for earnings per share from continuing operations attributable to owners
1,205
12,085
2,052
(Loss)/profit for earnings per share from discontinued operations attributable to owners
(65)
(247)
185
Profit for basic and diluted earnings per share
1,140
11,838
2,237
Re-presented1
Re-presented1
2024
2023
2022
eurocents
eurocents
eurocents
Basic earnings per share from continuing operations
4.45c
43.66c
7.07c
Basic (loss)/earnings per share from discontinued operations
(0.24)c
(0.89)c
0.64c
Basic earnings per share
4.21c
42.77c
7.71c
Re-presented1
Re-presented1
2024
2023
2022
eurocents
eurocents
eurocents
Diluted earnings per share from continuing operations
4.44c
43.51c
7.05c
Diluted (loss)/earnings per share from discontinued operations
(0.24)c
(0.89)c
0.63c
Diluted earnings per share
4.20c
42.62c
7.68c
Note:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
9. Equity dividends
Dividends are one type of shareholder return, historically paid to our shareholders in February and August.
2024
2023
2022
€m
€m
€m
Declared during the financial year
Final dividend for the year ended 31 March 2023: 4.50 eurocents per share
1,215
1,265
1,254
(2022: 4.50 eurocents per share, 2021: 4.50 eurocents per share)
Interim dividend for the year ended 31 March 2024: 4.50 eurocents per share
1,218
1,237
1,229
(2023: 4.50 eurocents per share, 2022: 4.50 eurocents per share)
2,433
2,502
2,483
Proposed after the end of the year and not recognised as a liability
Final dividend for the year ended 31 March 2024: 4.50 eurocents per share
1,219
1,215
1,265
(2023: 4.50 eurocents per share, 2022: 4.50 eurocents per share)
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10. Intangible assets
The consolidated statement of financial position contains significant intangible assets, mainly in relation to goodwill
and licences and spectrum. Goodwill, which arises when we acquire a business and pay a higher amount than the fair
value of its net assets primarily due to the synergies we expect to create, is not amortised but is subject to annual
impairment reviews. Licences and spectrum are amortised over the life of the licence. For further details see ‘Critical
accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation ‘ to the consolidated
financial statements.
Accounting policies
Identifiable intangible assets are recognised when the Group controls the asset, it is probable that future economic benefits attributed to the asset
will flow to the Group and the cost of the asset can be reliably measured. Identifiable intangible assets are recognised at fair value when the Group
completes a business combination. The determination of the fair values of the separately identified intangibles, is based, to a considerable extent,
on management’s judgement.
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the
identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition.
Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill is not
subject to amortisation but is tested for impairment annually or whenever there is evidence that it may be impaired. Goodwill is denominated in the
currency of the acquired entity and revalued to the closing exchange rate at each reporting period date.
Negative goodwill arising on an acquisition is recognised directly in the consolidated income statement.
On disposal of a subsidiary or a joint arrangement, the attributable amount of goodwill is included in the determination of the profit or loss
recognised in the consolidated income statement on disposal.
Finite lived intangible assets
Intangible assets with finite lives are stated at acquisition or development cost, less accumulated amortisation. The amortisation period and method
is reviewed at least annually. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in
the asset are accounted for by changing the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.
Licence and spectrum fees
Amortisation periods for licence and spectrum fees are determined primarily by reference to the unexpired licence period, the conditions for licence
renewal and whether licences are dependent on specific technologies. Amortisation is charged to the consolidated income statement on a straight-
line basis over the estimated useful lives from the commencement of related network services.
Software
Computer software comprises software purchased from third parties as well as the cost of internally developed software. Computer software
licences are capitalised on the basis of the costs incurred to acquire and bring into use the specific software. Costs that are directly associated with
the production of identifiable and unique software products controlled by the Group, and are probable of producing future economic benefits, are
recognised as intangible assets. Direct costs of software development include employee costs and directly attributable overheads.
Software integral to an item of hardware equipment is classified as property, plant and equipment.
Costs associated with maintaining software programs are recognised as an expense when they are incurred.
Amortisation is charged to the consolidated income statement on a straight-line basis over the estimated useful life from the date the software is
available for use.
Other intangible assets
Other intangible assets, including brands and customer bases, are recorded at fair value at the date of acquisition. Amortisation is charged to the
consolidated income statement, over the estimated useful lives of intangible assets from the date they are available for use, on a straight-line basis.
The amortisation basis adopted for each class of intangible asset reflects the Group’s consumption of the economic benefit from that asset.
Estimated useful lives
The estimated useful lives of finite lived intangible assets are as follows:
Licence and spectrum fees
3 - 40 years
Software
3 - 10 years
Brands
1 - 30 years
Customer bases
2 - 37 years
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Notes to the consolidated financial statements (continued)
10. Intangible assets (continued)
Licence and
Computer
Customer
Goodwill
spectrum fees
software
bases
Other
Total
€m
€m
€m
€m
€m
€m
Cost
1 April 2022
100,897
35,025
18,121
12,552
550
167,145
Exchange movements
(783)
(1,270)
(504)
(240)
(53)
(2,850)
Disposal of subsidiaries
(3,939)
(443)
(348)
(458)
(4)
(5,192)
Additions
–
439
2,804
–
7
3,250
Disposals
–
(2)
(1,831)
–
(1)
(1,834)
Hyperinflation impacts
729
557
232
51
40
1,609
31 March 2023
96,904
34,306
18,474
11,905
539
162,128
Exchange movements
(1,042)
(435)
(414)
(130)
(60)
(2,081)
Additions
–
283
2,615
–
17
2,915
Disposals
–
(986)
(989)
–
(2)
(1,977)
Transfer of assets held for resale
(19,498)
(6,258)
(2,600)
(2,517)
(57)
(30,930)
Hyperinflation impacts
888
382
348
62
49
1,729
31 March 2024
77,252
27,292
17,434
9,320
486
131,784
Accumulated impairment losses and amortisation
1 April 2022
69,013
23,792
12,257
8,013
538
113,613
Exchange movements
(414)
(846)
(351)
(231)
(50)
(1,892)
Disposal of subsidiaries
(39)
(147)
(180)
(80)
(2)
(448)
Charge for the year1
–
1,133
2,343
554
1
4,031
Disposals
–
(2)
(1,814)
–
(1)
(1,817)
Hyperinflation impacts
729
407
207
51
40
1,434
31 March 2023
69,289
24,337
12,462
8,307
526
114,921
Exchange movements
(897)
(144)
(324)
(120)
(56)
(1,541)
Charge for the year1
–
1,031
2,484
606
1
4,122
Disposals
–
(985)
(951)
–
–
(1,936)
Transfer of assets held for resale
(16,984)
(2,704)
(1,871)
(2,517)
(57)
(24,133)
Hyperinflation impacts
888
196
304
62
49
1,499
31 March 2024
52,296
21,731
12,104
6,338
463
92,932
Net book value
31 March 2023
27,615
9,969
6,012
3,598
13
47,207
31 March 2024
24,956
5,561
5,330
2,982
23
38,852
Note:
1 Included in the charge for the year ended 31 March 2024 is €607 million (2023: €651 million) in respect of Vodafone Italy and Vodafone Spain, which are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
For licences and spectrum fees and other intangible assets, amortisation is included within the cost of sales line within the consolidated income
statement. Included in the net book value of computer software are assets in the course of construction, which are not depreciated, with a cost of
€1,200 million (2023: €1,451 million).
The net book value and expiry dates of the most significant licences are as follows:
2024
2023
Expiry dates
€m
€m
Germany
2025-2040
2,686
2,979
UK
2033-2041
989
1,055
Vodacom
2024-2042
687
774
Italy
2029-2037
-
3,123
Spain
2028-2061
-
758
The remaining amortisation period for each of the licences in the table above corresponds to the expiry date of the respective licence. A summary of
the Group’s most significant spectrum licences can be found on page 260.
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11. Property, plant and equipment
The Group makes significant investments in network equipment and infrastructure – the base stations and technology
required to operate our networks – that form the majority of our tangible assets. All assets are depreciated over their
useful economic lives. For further details on the estimation of useful economic lives, see ‘Critical accounting
judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation ‘to the consolidated financial
statements.
Accounting policies
Land and buildings held for use are stated in the consolidated statement of financial position at their cost, less any accumulated depreciation and
any accumulated impairment losses.
Amounts for equipment, fixtures and fittings, which includes network infrastructure assets are stated at cost less accumulated depreciation and any
accumulated impairment losses.
Assets in the course of construction are carried at cost, less any recognised impairment losses. Depreciation of these assets commences when the
assets are ready for their intended use.
The cost of property, plant and equipment includes directly attributable incremental costs incurred in their acquisition and installation.
Depreciation is charged so as to write off the cost of assets, other than land, using the straight-line method, over their estimated useful lives, as
follows:
Land and buildings
Freehold buildings
25 - 50 years
Leasehold premises
the term of the lease
Equipment, fixtures and fittings
Network infrastructure and other
1 - 35 years
Depreciation is not provided on freehold land.
Right-of-use assets arising from the Group’s lease arrangements are depreciated over their reasonably certain lease term, as determined under the
Group’s leases policy (see note 20 ‘Leases’ and ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of
preparation’ for details).
The gain or loss arising on the disposal, retirement or granting of a finance lease on an item of property, plant and equipment is determined as the
difference between any proceeds from sale or receivables arising on a lease and the carrying amount of the asset and is recognised in the
consolidated income statement.
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Notes to the consolidated financial statements (continued)
11. Property, plant and equipment (continued)
Equipment,
Land and
fixtures
buildings
and fittings
Total
€m
€m
€m
Cost
1 April 2022
2,361
81,096
83,457
Exchange movements
(81)
(2,648)
(2,729)
Disposal of subsidiaries
(69)
(7,210)
(7,279)
Additions
49
5,805
5,854
Disposals
(253)
(3,724)
(3,977)
Hyperinflation impacts
7
1,040
1,047
Other
(17)
101
84
31 March 2023
1,997
74,460
76,457
Exchange movements
(31)
(1,878)
(1,909)
Additions
34
4,753
4,787
Disposals
(15)
(2,070)
(2,085)
Transfer of assets held for resale
(439)
(18,530)
(18,969)
Hyperinflation impacts
9
1,376
1,385
Other
2
90
92
31 March 2024
1,557
58,201
59,758
Accumulated depreciation and impairment
1 April 2022
1,372
52,941
54,313
Exchange movements
(28)
(1,694)
(1,722)
Disposal of subsidiaries
(18)
(4,543)
(4,561)
Charge for the year1
83
5,544
5,627
Disposals
(170)
(3,672)
(3,842)
Hyperinflation impacts
1
747
748
31 March 2023
1,240
49,323
50,563
Exchange movements
(7)
(1,258)
(1,265)
Charge for the year1
56
4,814
4,870
Disposals
(15)
(2,039)
(2,054)
Transfer of assets held for resale
(287)
(12,507)
(12,794)
Hyperinflation impacts
2
1,037
1,039
31 March 2024
989
39,370
40,359
Net book value
31 March 2023
757
25,137
25,894
31 March 2024
568
18,831
19,399
Note:
1 Included in the charge for the year ended 31 March 2024 was €988 million (2023: €1,485 million) in respect of Vodafone Italy and Vodafone Spain, which are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
Included in the net book value of land and buildings and equipment, fixtures and fittings are assets in the course of construction, which are not
depreciated, with a cost of €4 million (2023: €10 million) and €1,401 million (2023: €1,988 million) respectively. Also included in the book value of
equipment, fixtures and fittings are assets leased out by the Group under operating leases, with a cost of €1,623 million (2023: €2,170 million),
accumulated depreciation of €1,040 million (2023: €1,393 million) and net book value of €583 million (2023: €777 million).
Right-of-use assets arising from the Group’s lease arrangements are recorded within property, plant and equipment:
2024
2023
€m
€m
Property, plant and equipment (owned assets)
19,399
25,894
Right-of-use assets
9,100
12,098
31 March
28,499
37,992
Additions of €4,173 million (2023: €7,387 million) and a depreciation charge of €4,108 million (2023: €3,960 million) were recorded in respect of
right-of-use assets during the year ended 31 March 2024. Included in the depreciation charge for the year ended 31 March 2024 was €1,091 million
(2023: €1,227 million) in respect of Vodafone Italy and Vodafone Spain, which are now reported as discontinued operations. See note 7
‘Discontinued operations and assets held for sale’.
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12. Investments in associates and joint arrangements
The Group holds interests in associates in Kenya and in India, where we have significant influence, as well as in a
number of joint arrangements, notably in the Netherlands, India, Australia and Oak Holdings 1 GmbH and its markets,
where we share control with one or more third parties. For further details see ‘Critical accounting judgements and key
sources of estimation uncertainty’ in note 1 ‘Basis of preparation’ to the consolidated financial statements.
Accounting policies
Interests in joint arrangements
A joint arrangement is a contractual arrangement whereby the Group and other parties undertake an economic activity that is subject to joint
control; that is, when the relevant activities that significantly affect the investee’s returns require the unanimous consent of the parties sharing
control. Joint arrangements are either joint operations or joint ventures.
Gains or losses resulting from the contribution or sale of a subsidiary as part of the formation of a joint arrangement are recognised in respect of
the Group’s entire equity holding in the subsidiary.
Joint operations
A joint operation is a joint arrangement whereby the parties that have joint control have the rights to the assets, and obligations for the liabilities,
relating to the arrangement or that other facts and circumstances indicate that this is the case. The Group’s share of assets, liabilities, revenue,
expenses and cash flows are combined with the equivalent items in the consolidated financial statements on a line-by-line basis.
Any goodwill arising on the acquisition of the Group’s interest in a joint operation is accounted for in accordance with the Group’s accounting policy
for goodwill arising on the acquisition of a subsidiary.
Joint ventures
A joint venture is a joint arrangement whereby the parties that have joint control have the rights to the net assets of the arrangement.
At the date of acquisition, any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and
contingent liabilities of the joint venture is recognised as goodwill. The goodwill is included within the carrying amount of the investment.
The results and assets and liabilities of joint ventures, other than those joint ventures or part thereof that are held for sale (see note 7 ‘Discontinued
operations and assets held for sale’), are incorporated in the consolidated financial statements using the equity method of accounting. Under the
equity method, investments in joint ventures are carried in the consolidated statement of financial position at cost adjusted for post-acquisition
changes in the Group’s share of the net assets of the joint venture, less any impairment in the value of the investment. The Group’s share of post-tax
profits or losses are recognised in the consolidated income statement. Losses of a joint venture in excess of the Group’s interest in that joint venture
are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the joint venture.
Associates
An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint arrangement.
Significant influence is the power to participate in the financial and operating policy decisions of the investee but where the Group does not have
control or joint control over those policies.
At the date of acquisition, any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities
and contingent liabilities of the associate is recognised as goodwill. The goodwill is included within the carrying amount of the investment.
The results and assets and liabilities of associates are incorporated in the consolidated financial statements using the same equity method of
accounting used for joint ventures, described above.
Joint operations
In the prior year, on 22 March 2023, the Group completed the disposal of its principal joint operation (Cornerstone Telecommunications
Infrastructure Limited) as part of the transaction with Oak Holdings 1 GmbH.
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Notes to the consolidated financial statements (continued)
12. Investments in associates and joint arrangements (continued)
Joint ventures and associates
2024
2023
€m
€m
Investments in joint ventures
8,203
9,578
Investments in associates
1,829
1,501
31 March
10,032
11,079
Joint ventures
The financial and operating activities of the Group’s joint ventures are jointly controlled by the participating shareholders. The participating
shareholders have rights to the net assets of the joint ventures through their equity shareholdings. Unless otherwise stated, the Group’s principal
joint ventures all have share capital consisting solely of ordinary shares and are all indirectly held. The country of incorporation or registration of all
joint ventures is also their principal place of operation.
Country of
incorporation or
registration
Percentage
shareholdings1
Percentage
shareholdings1
Name of joint venture
Principal activity
2024
2023
Oak Holdings 1 GmbH
Network infrastructure
Germany
60.3
64.2
VodafoneZiggo Group Holding B.V.
Network operator
Netherlands
50.0
50.0
OXG Glasfaser Beteiligungs GmbH
Fibre infrastructure
Germany
50.0
50.0
Vodafone Idea Limited2
Network operator
India
31.4
32.3
TPG Telecom Limited3
Network operator
Australia
25.1
25.1
Notes:
1 Effective ownership percentages of Vodafone Group Plc rounded to the nearest tenth of one percent.
2 At 31 March 2024 the fair value of the Group’s interest in Vodafone Idea Limited was INR 208 billion (€2,313 million) (2023: INR 91 billion (€1,021 million)) based on the quoted share price
on the National Stock Exchange of India.
3 At 31 March 2024 the fair value of the Group’s interest in TPG Telecom Limited was AUD 2,101 million (€1,269 million) (2023: AUD 2,273 million (€1,401 million)) based on the quoted share
price on ASX.
Oak Holdings 1 GmbH
In March 2023, the Group completed the disposal of its interest in Vantage Towers A.G. to Oak Holdings 1 GmbH, the co-controlled partnership of
Vodafone, GIP and KKR. Vodafone retained an interest of 64.2% in Oak Holdings 1 GmbH. On 18 July 2023, the Group completed the sale of 3.9% of
Oak Holdings 1 GmbH for cash consideration of €500 million, reducing its interest to 60.3%.
OXG Glasfaser Beteiligungs GmbH
In March 2023, the Group entered into an agreement with Altice Luxembourg S.A. to create a joint venture, OXG Glasfaser Beteiligungs GmbH
(‘OXG’), with 50.0% shareholding held by each shareholder. Each shareholder is committed to contribute funding of up to €950 million to OXG for
the deployment of fibre-to-the-home in Germany. During the year ended 31 March 2024, the Group provided €32 million of capital contributions to
OXG. The remaining funding commitment of €918 million is expected to be contributed between 2024 and 2029. The amount and timing of the
funding depends on the speed and size of the fibre deployment. The contribution can be in the form of free capital reserves, shareholder loan, loan
notes or similar instruments as agreed by the shareholders.
Vodafone Idea Limited
The Group’s carrying value in Vodafone Idea Limited (‘VIL’) reduced to €nil at 30 September 2019. The Group’s share of VIL’s losses not recognised
at 31 March 2024 is €4,528 million (2023: €3,717 million). Vodafone Idea Limited has undertaken equity fund-raisings totalling €2.2 billion since 31
March 2024, reducing the Group’s shareholding to 23.2%
The value of the Group’s 21.0% shareholding in Indus Towers Limited is, in part, dependent on the income generated by Indus Towers Limited from
tower rentals to major customers, including VIL. Any inability of these major customers to pay such amounts in the future may impact the carrying
value of €1,104 million at 31 March 2024 (2023: €908 million) of the Group’s investment in Indus Towers Limited.
VIL has undertaken equity fund-raisings totalling €2.2 billion since 31 March 2024, reducing the Group’s shareholding to 23.2%.
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TPG Telecom Limited
TPG Telecom Limited is listed on the Australian Securities Exchange (‘ASX’). Vodafone and Hutchison Telecommunications (Australia) Limited each
own an economic interest of 25.05%, with the remaining 49.9% listed as free float on the ASX. The financial information presented in the tables
below includes debt held within the structure that holds the Group’s interest in TPG.
Dividends received from joint ventures
During the year ended 31 March 2024, the Group received dividends included in the consolidated statement of cash flows from VodafoneZiggo
Group Holding B.V. of €100 million (2023: €165 million, 2022: €350 million), TPG Telecom Limited of €23 million (2023: €24 million, 2022: €22
million) and Oak Holdings 1 GmbH of €196 million (2023: €nil, 2022: €nil).
Aggregated financial information
The table below provides aggregated financial information for the Group’s joint ventures as it relates to the amounts recognised in the consolidated
income statement and consolidated statement of financial position.
Investment in joint ventures
(Loss)/profit for the financial year1
2024
2023
2024
2023
2022
€m
€m
€m
€m
€m
Oak Holdings 1 GmbH
7,620
8,634
(85)
–
–
VodafoneZiggo Group Holding B.V.
516
793
(177)
137
(19)
TPG Telecom Limited
(2)
108
(74)
48
(5)
INWIT S.p.A.
–
–
–
30
27
Other
69
43
(43)
(15)
(14)
Total
8,203
9,578
(379)
200
(11)
Note:
1 Total Other comprehensive (expense)/income is not materially different to (loss)/profit for the financial year.
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Notes to the consolidated financial statements (continued)
12. Investments in associates and joint arrangements (continued)
Summarised financial information
Summarised financial information for each of the Group’s material joint ventures on a 100% ownership basis is set out below and overleaf.
Financial information is presented for Vodafone Idea Limited (‘VIL’) for the six month period to, and as at 30 September 2023 on the basis that full-
year information in relation to VIL has not been released at the date of approval of these consolidated financial statements and as such is market
sensitive for VIL. As disclosed above, the Group’s investment in VIL was reduced to €nil in the year ended 31 March 2020 and the Group has not
recorded any profit or loss in respect of its share of VIL’s results since that date.
Financial information is presented for TPG Telecom Limited (‘TPG’) for the year to, and as at 31 December 2023 on the basis that full-year
information in relation to TPG has not been released at the date of approval of these consolidated financial statements and as such is market
sensitive for TPG.
Financial information presented for INWIT S.p.A. for the years to 31 March 2023 and 31 March 2022 is based on the financial results and financial
position as at 31 December 2022 and 31 December 2021, respectively, being the latest financial information available to the Group when
completing the consolidated financial statements for each year.
Oak Holdings 1 GmbH
VodafoneZiggo Group Holding B.V.
2024
2023
2022
2024
2023
2022
€m
€m
€m
€m
€m
€m
Income statement
Revenue
1,166
–
–
4,128
4,063
4,056
Operating expenses
(130)
–
–
(2,195)
(2,124)
(2,104)
Depreciation and amortisation
(868)
–
–
(1,555)
(1,527)
(1,592)
Other income
5
–
–
–
–
–
Operating profit
173
–
–
378
412
360
Interest income
5
–
–
–
–
–
Interest expense
(455)
–
–
(809)
11
(276)
Loss/(profit) before tax
(277)
–
–
(431)
423
84
Income tax credit/(expense)
132
–
–
77
(150)
(121)
(Loss)/profit for the financial year1
(145)
–
–
(354)
273
(37)
Vodafone Idea Limited
TPG Telecom Limited
2024
2023
2022
2024
2023
2022
€m
€m
€m
€m
€m
€m
Income statement
Revenue
2,381
5,046
4,450
3,371
3,027
3,375
Operating expenses
(1,557)
(3,280)
(2,802)
(2,238)
(1,870)
(2,292)
Depreciation and amortisation
(1,081)
(2,396)
(2,390)
(891)
(700)
(914)
Other expense
–
–
(34)
–
–
–
Operating profit
(257)
(630)
(776)
242
457
169
Interest income
4
9
14
–
–
–
Interest expense
(1,347)
(2,567)
(2,297)
(368)
(172)
(122)
(Loss)/profit before tax
(1,600)
(3,188)
(3,059)
(126)
285
47
Income tax (expense)/credit
–
–
2
(8)
(25)
(27)
(Loss)/profit for the financial year1
(1,600)
(3,188)
(3,057)
(134)
260
20
INWIT S.p.A.
2024
2023
2022
€m
€m
€m
Income statement
Revenue
–
853
785
Operating expenses
–
(73)
(70)
Depreciation and amortisation
–
(508)
(513)
Operating profit
–
272
202
Interest expense
–
(81)
(90)
Profit before tax
–
191
112
Income tax expense
–
(1)
(30)
Profit for the financial year1
–
190
82
Note:
1 Total Other comprehensive income/(expense) is not materially different to profit/(loss) for the financial year.
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Oak Holdings 1 GmbH
VodafoneZiggo Group Holding B.V.
2024
2023
2024
2023
€m
€m
€m
€m
Statement of financial position
Non-current assets
24,015
23,878
15,753
16,570
Current assets
746
749
884
719
Total assets
24,761
24,627
16,637
17,289
Equity shareholders’ funds
12,630
13,450
1,033
1,586
Non-controlling interests
–
1,262
–
–
Non-current liabilities
9,386
6,709
13,145
13,299
Current liabilities
2,745
3,206
2,459
2,404
Cash and cash equivalents within current assets
267
224
61
20
Non-current liabilities excluding trade and other payables and provisions
8,751
6,215
12,995
13,138
Current liabilities excluding trade and other payables and provisions
502
2,409
1,171
1,247
Vodafone Idea Limited1
TPG Telecom Limited
2024
2023
2024
2023
€m
€m
€m
€m
Statement of financial position
Non-current assets
17,324
18,162
9,663
9,823
Current assets
2,352
2,174
900
1,009
Total assets
19,676
20,336
10,563
10,832
Equity shareholders’ (deficit)/funds
(12,562)
(10,760)
2,606
3,019
Non-current liabilities
25,720
24,730
6,789
6,702
Current liabilities
6,518
6,366
1,168
1,111
Cash and cash equivalents within current assets
71
96
192
290
Non-current liabilities excluding trade and other payables and provisions
25,700
24,707
6,704
6,595
Current liabilities excluding trade and other payables and provisions
2,595
2,699
102
86
Note:
1 Includes certain amounts subject to an adjustment mechanism agreed as part of the formation of Vodafone Idea Limited. See note 29 ‘Contingent liabilities and legal proceedings’.
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Notes to the consolidated financial statements (continued)
12. Investments in associates and joint arrangements (continued)
The reconciliation of summarised financial information presented to the carrying amount of our interest in joint ventures is set out below.
Oak Holdings 1 GmbH
VodafoneZiggo Group Holding B.V.
2024
2023
2024
2023
2022
€m
€m
€m
€m
€m
Equity shareholders’ funds
12,630
13,450
1,033
1,586
Interest in joint ventures1
7,620
8,634
516
793
Carrying value
7,620
8,634
516
793
(Loss)/profit for the financial year
(145)
–
(354)
273
(37)
Share of (loss)/profit1
(85)
–
(177)
137
(19)
Vodafone Idea Limited
TPG Telecom Limited
2024
2023
2022
2024
2023
2022
€m
€m
€m
€m
€m
€m
Equity shareholders’ (deficit)/funds
(12,562)
(10,760)
2,606
3,019
Interest in joint ventures1
(4,057)
(3,475)
(53)
56
Impairment
(246)
(242)
–
–
Goodwill
–
–
51
52
Investment proportion not recognised
4,303
3,717
–
–
Carrying value
–
–
(2)
108
(Loss)/profit for the financial year
(1,600)
(3,188)
(3,057)
(134)
260
20
Share of (loss)/profit1
(517)
(1,030)
(1,357)
(74)
48
(5)
Share of loss not recognised
517
1,030
1,357
–
–
–
Share of (loss)/profit1
–
–
–
(74)
48
(5)
INWIT S.p.A.
2024
2023
2022
€m
€m
€m
Equity shareholders’ funds
–
–
Interest in joint ventures
–
–
Carrying value
–
–
Profit for the financial year
–
190
82
Share of profit
–
63
27
Share of profit not recognised as held for sale
–
(33)
–
Share of profit
–
30
27
Note:
1 The Group’s effective ownership percentages of Oak Holdings 1 GmbH, VodafoneZiggo Group Holding B.V., Vodafone Idea Limited and TPG Telecom Limited are 60.3%, 50.0%, 31.4% and
25.1%, respectively, rounded to the nearest tenth of one percent.
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Associates
Unless otherwise stated, the Group’s principal associates all have share capital consisting solely of ordinary shares and are all indirectly held. The
country of incorporation or registration of all associates is also their principal place of operation.
Country of
Percentage
Percentage
incorporation or
shareholding1
shareholding1
Name of associate
Principal activity
registration
2024
2023
Safaricom PLC2
Network operator
Kenya
39.9
39.9
Indus Towers Limited3
Network infrastructure
India
21.0
21.0
Notes:
1 Effective ownership percentages of Vodafone Group Plc rounded to the nearest tenth of one percent.
2 At 31 March 2024, the fair value of the Group’s interest in Safaricom PLC was KES 284 billion (€1,996 million) (2023: KES 290 billion (€2,012 million)) based on the closing quoted share price
on the Nairobi Stock Exchange.
3 At 31 March 2024, the fair value of the Group’s interest in Indus Towers Limited was INR 165 billion (€1,833 million) (2023: INR 81 billion (€908 million)) based on the closing quoted share
price on the National Stock Exchange of India.
Aggregated financial information
The table below provides aggregated financial information for the Group’s associates as it relates to the amounts recognised in the consolidated
income statement and consolidated statement of financial position.
Investment in associates
Profit/(loss) for the financial year
2024
2023
2024
2023
2022
€m
€m
€m
€m
€m
Safaricom PLC1
627
509
159
195
217
Indus Towers Limited
1,104
908
140
50
178
Other
98
84
(16)
(12)
5
Total
1,829
1,501
283
233
400
Note:
1 Other comprehensive income includes profit for the financial year, together with €76 million (2023: €127 million) in respect of the application of IAS 29 to Safaricom’s operations in Ethiopia.
Dividends from associates
During the year ended 31 March 2024, the Group received dividends included in the consolidated statement of cash flows from Safaricom PLC of
€122 million (2023: €250 million, 2022: €170 million) and from Indus Towers Limited of €nil (2023: €75 million, 2022: €nil).
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Notes to the consolidated financial statements (continued)
12. Investments in associates and joint arrangements (continued)
Summarised financial information
Summarised financial information for each of the Group’s material associates on a 100% ownership basis is set out below.
Safaricom PLC
Indus Towers Limited
2024
2023
2022
2024
2023
2022
€m
€m
€m
€m
€m
€m
Income statement
Revenue
2,210
2,468
2,318
3,185
3,343
3,122
Operating expenses
(1,189)
(1,353)
(1,164)
(1,598)
(2,240)
(1,480)
Depreciation and amortisation
(523)
(432)
(309)
(637)
(588)
(598)
Other income
142
68
–
–
–
–
Operating profit
640
751
845
950
515
1,044
Interest income
16
13
9
126
26
–
Interest expense
(121)
(69)
(59)
(218)
(200)
(140)
Profit before tax
535
695
795
858
341
904
Income tax expense
(266)
(285)
(270)
(192)
(102)
(272)
Profit for the financial year and total
comprehensive income
269
410
525
666
239
632
Attributable to:
- Owners of the parent
399
489
542
666
239
632
- Non-controlling interests
(130)
(79)
(17)
–
–
–
Statement of financial position
Non-current assets
3,901
3,007
6,082
5,243
Current assets
578
436
1,230
1,081
Total assets
4,479
3,443
7,312
6,324
Equity shareholders' funds
1,566
1,269
4,086
3,453
Non-controlling interests
767
532
–
–
Non-current liabilities
968
753
2,098
1,954
Current liabilities
1,178
889
1,128
917
Cash and cash equivalents within current assets
163
127
7
3
Non-current liabilities excluding trade and other
payables and provisions
784
500
1,716
1,665
Current liabilities excluding trade and other
payables and provisions
349
322
583
491
The reconciliation of summarised financial information presented to the carrying amount of our interest in the associate is set out below.
Safaricom PLC
Indus Towers Limited
2024
2023
2022
2024
2023
2022
€m
€m
€m
€m
€m
€m
Equity shareholders' funds
1,566
1,269
4,086
3,453
Interest in associates1
625
507
860
727
Goodwill
2
2
244
181
Carrying value
627
509
1,104
908
Profit for the financial year
399
489
542
666
239
632
Share of profit
159
195
217
140
50
178
Note:
1 The Group’s effective ownership percentages of Safaricom PLC and Indus Towers Limited are 39.9% and 21.0%, respectively, rounded to the nearest tenth of one percent.
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13. Other investments
The Group holds a number of other listed and unlisted investments, mainly comprising managed funds,
deposits and government bonds.
Accounting policies
Other investments comprising debt and equity instruments are recognised and derecognised on settlement date and are initially measured
at fair value, including transaction costs.
Debt securities that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and
interest are measured at amortised cost using the effective interest method, less any impairment. Debt securities that do not meet the
criteria for amortised cost are measured at fair value through profit and loss.
Equity securities are classified and measured at fair value through other comprehensive income, there is no subsequent reclassification of
fair value gains and losses to profit or loss following derecognition of the investment.
2024
2023
€m
€m
Included within non-current assets
Equity securities1
65
94
Debt securities2
941
999
1,006
1,093
Included within current assets
Short-term investments:
Bonds and debt securities3
1,201
1,338
Managed investment funds1
2,024
2,967
3,225
4,305
Collateral assets4
741
239
Other investments5
1,126
2,473
5,092
7,017
Notes:
1 Items measured at a fair value, €27 million (2023: €47 million) of equity securities have a valuation basis of level 1 classification, which comprises financial instruments where fair value is
determined by unadjusted quoted prices in active markets for identical assets and liabilities. The remaining items are measured at fair value and the basis is level 2 classification, which
comprises items where fair value is determined from inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly.
2 Items are measured at amortised cost and have a fair value of €810 million (2023: €803 million) with a valuation basis of level 2 classification.
3 Items are measured at fair value and the valuation basis is level 1 classification.
4 Items are measured at amortised cost and the carrying amount approximates fair value.
5 Includes investments measured at a fair value of €459 million (2023: €1,409 million). The valuation basis is level 1. The remaining items are measured at amortised cost and the carrying
amount approximates fair value.
Non-current debt securities within non-current assets include €830 million (2023: €885 million) of loan notes issued by VodafoneZiggo
Holding B.V.
The Group invests surplus cash positions across a portfolio of short-term investments to manage liquidity and credit risk whilst achieving
suitable returns. Collateral arrangements on derivative financial instruments result in cash being paid/(held), repayable when the
derivatives are settled. These assets do not meet the definition of cash and cash equivalents but are included in the Group’s net debt based
on their liquidity.
Bonds and debt securities includes €587 million (2023: €nil) of highly liquid French; €308 million (2023: €290 million) Dutch; €306 million
(2023: €899 million) Japanese and €nil (2023: €150 million) German government securities.
Managed investment funds of €2,024 million (2023: €2,967 million) are in funds with liquidity of up to 90 days.
Collateral assets of €741 million (2023: €239 million) represents collateral paid on derivative financial instruments.
Other investments are excluded from net debt based on their liquidity and primarily consist of restricted debt securities including amounts
held in qualifying assets by Group insurance companies to meet regulatory requirements.
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Notes to the consolidated financial statements (continued)
14. Trade and other receivables
Trade and other receivables mainly consist of amounts owed to us by customers and amounts that we pay to our
suppliers in advance. Derivative financial instruments with a positive market value are reported within this note as are
contract assets, which represent an asset for accrued revenue in respect of goods or services delivered to customers for
which a trade receivable does not yet exist, and finance lease receivables recognised where the Group acts as a lessor.
See note 20 ‘Leases’ for more information on the Group’s leasing activities.
Accounting policies
Trade receivables represent amounts owed by customers where the right to receive payment is conditional only on the passage of time. Trade
receivables that are recovered in instalments from customers over an extended period are discounted at market rates and interest revenue is
accreted over the expected repayment period. Other trade receivables do not carry any interest and are stated at their nominal value. When the
Group establishes a practice of selling portfolios of receivables from time to time these portfolios are recorded at fair value through other
comprehensive income; all other trade receivables are recorded at amortised cost.
The carrying value of all trade receivables, contract assets and finance lease receivables recorded at amortised cost is reduced by allowances for
lifetime estimated credit losses. Estimated future credit losses are first recorded on the initial recognition of a receivable and are based on the
ageing of the receivable balances, historical experience and forward looking considerations. Individual balances are written off when management
deems them not to be collectible.
2024
2023
€m
€m
Included within non-current assets
Trade receivables
8
51
Trade receivables held at fair value through other comprehensive income
294
337
Net investment in leases
211
267
Contract assets
450
494
Contract-related costs
676
690
Other receivables
78
66
Prepayments
239
296
Derivative financial instruments1
4,011
5,642
5,967
7,843
Included within current assets
Trade receivables
2,841
3,277
Trade receivables held at fair value through other comprehensive income
441
566
Net investment in leases
99
106
Contract assets
2,413
3,063
Contract-related costs
1,169
1,471
Amounts owed by associates and joint ventures
130
175
Other receivables
686
730
Prepayments
600
835
Derivative financial instruments1
215
482
8,594
10,705
Note:
1 Includes €22 million (2023: €198 million) of embedded derivative option for which fair value is based on level 3 of the fair value hierarchy (see section on fair value carrying value information
within note 22 ‘Capital and Risk Management’). All other items are measured at fair value and the valuation basis is level 2 classification, which comprises items where fair value is determined
from inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly.
The Group’s trade receivables and contract assets are classified at amortised cost unless stated otherwise and are measured after allowances for
future expected credit losses, see note 22 ‘Capital and financial risk management’ for more information on credit risk.
The carrying amounts of trade and other receivables, which are measured at amortised cost, approximate their fair value and are predominantly
non-interest bearing.
The Group’s contract-related costs comprise €1,814 million (2023: €2,078 million) relating to costs incurred to obtain customer contracts and €31
million (2023: €83 million) relating to costs incurred to fulfil customer contracts; an amortisation and impairment expense, excluding discontinued
operations in Spain and Italy, of €853 million (2023: €824 million) was recognised in operating profit during the year.
Other than for the embedded derivative option described above, the fair values of the derivative financial instruments are calculated by discounting
the future cash flows to net present values using appropriate market interest rates and foreign currency rates prevailing at 31 March.
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15. Trade and other payables
Trade and other payables mainly consist of amounts owed to suppliers that have been invoiced or are accrued and
contract liabilities relating to consideration received from customers in advance. They also include taxes and social
security amounts due in relation to the Group’s role as an employer. Derivative financial instruments with a negative
market value are reported within this note.
Accounting policies
Trade payables are not interest-bearing and are stated at their nominal value.
Re-presented1
2024
2023
€m
€m
Included within non-current liabilities
Other payables
222
263
Insurance liabilities
254
257
Accruals
41
48
Contract liabilities
343
500
Derivative financial instruments2
1,468
1,116
2,328
2,184
Included within current liabilities
Trade payables
5,613
7,599
Amounts owed to associates and joint ventures
346
329
Other taxes and social security payable
887
1,013
Other payables
846
2,080
Insurance liabilities
48
63
Accruals
4,037
4,814
Contract liabilities
1,565
2,043
Derivative financial instruments2
56
306
13,398
18,247
Notes:
1. The insurance liabilities comparatives for the year-end 31 March 2023 have been re-presented for the adoption of IFRS 17 ‘Insurance Contracts’ although there is no impact on the total
amounts. See note 1 ‘Basis of preparation’ for more information.
2. Items are measured at fair value and the valuation basis is level 2 classification, which comprises items where fair value is determined from inputs other than quoted prices that are observable
for the asset or liability, either directly or indirectly.
The carrying amounts of trade and other payables approximate their fair value.
Materially all of the €2,043 million recorded as current contract liabilities at 1 April 2023 was recognised as revenue during the year with the
exception of Vodacom Italy and Vodafone Spain whose revenue of €299 million will be reported as part of the discontinued operation. See note 7
‘Discontinued operations and assets held for sale’ for more information.
Insurance liabilities included within non-current liabilities include €254 million (2023: €257 million) in respect of the re-insurance of a third party
annuity policy related to the Vodafone and CWW Sections of the Vodafone UK Group Pension Scheme.
The fair values of the derivative financial instruments are calculated by discounting the future cash flows to net present values using appropriate
market interest rates and foreign currency rates prevailing at 31 March.
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Notes to the consolidated financial statements (continued)
16. Provisions
A provision is a liability recorded in the Consolidated statement of financial position, where there is uncertainty over the
timing or amount that will be paid, and is therefore often estimated. The main provisions we hold are in relation to asset
retirement obligations, which include the cost of returning network infrastructure sites to their original condition at the
end of the lease and claims for legal and regulatory matters.
Accounting policies
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be
required to settle that obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the Directors’ best
estimate of the expenditure required to settle the obligation at the reporting date and are discounted to present value where the effect is material. Where
the timing of settlement is uncertain amounts are classified as non-current where settlement is expected more than 12 months from the reporting date.
Asset retirement obligations
In the course of the Group’s activities, a number of sites and other assets are utilised which are expected to have costs associated with decommissioning.
The associated cash outflows are substantially expected to occur at the dates of decommissioning of the assets to which they relate, and are long term in
nature.
Legal and regulatory
The Group is involved in a number of legal and other disputes, including where the Group has received notifications of possible claims. The
Directors of the Company, after taking legal advice, have established provisions considering the facts of each case. For a discussion of
certain legal issues potentially affecting the Group see note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial
statements.
Restructuring
The Group undertakes periodic reviews of its operations and recognises provisions as required based on the outcomes of these
reviews. The associated cash outflows for restructuring costs are primarily less than one year.
Other
Comprises various items that do not fall within the Group’s other categories of provisions.
Asset
retirement
Legal and
obligations
regulatory
Restructuring
Other
Total
€m
€m
€m
€m
€m
1 April 2022
1,470
449
302
327
2,548
Exchange movements
(22)
(28)
–
(2)
(52)
Disposal of subsidiaries
(578)
(8)
(2)
(2)
(590)
Amounts capitalised in the year
185
–
–
–
185
Amounts charged to the income statement
–
138
425
126
689
Utilised in the year - payments
(59)
(44)
(181)
(123)
(407)
Amounts released to the income statement
(1)
(77)
(36)
(48)
(162)
Other
35
–
–
–
35
31 March 2023
1,030
430
508
278
2,246
Exchange movements
(7)
(24)
3
(3)
(31)
Amounts capitalised in the year
146
–
–
–
146
Amounts charged to the income statement
–
162
774
206
1,142
Utilised in the year - payments
(54)
(72)
(290)
(116)
(532)
Amounts released to the income statement
(5)
(131)
(7)
(43)
(186)
Transfer to liabilities held for sale
(177)
(96)
(46)
(31)
(350)
Other
–
–
–
13
13
31 March 2024
933
269
942
304
2,448
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Provisions have been analysed between current and non-current as follows:
Asset
retirement
Legal and
obligations
regulatory
Restructuring
Other
Total
€m
€m
€m
€m
€m
Current liabilities
59
232
361
181
833
Non-current liabilities
874
37
581
123
1,615
31 March 2024
933
269
942
304
2,448
Asset
retirement
Legal and
obligations
regulatory
Restructuring
Other
Total
€m
€m
€m
€m
€m
Current liabilities
61
193
298
122
674
Non-current liabilities
969
237
210
156
1,572
31 March 2023
1,030
430
508
278
2,246
17. Called up share capital
Called up share capital is the number of shares in issue at their par value. A number of shares were allotted during the
year in relation to employee share schemes.
Accounting policies
Equity instruments issued by the Group are recorded at the amount of the proceeds received, net of direct issuance costs.
2024
2023
Number
€m
Number
€m
Ordinary shares of 20 20⁄21 US cents each allotted,
issued and fully paid:1, 2
1 April
28,818,256,058
4,797
28,817,627,868
4,797
Allotted during the year
427,750
–
628,190
–
31 March
28,818,683,808
4,797
28,818,256,058
4,797
Notes:
1 At 31 March 2024, there were 50,000 (2023: 50,000) 7% cumulative fixed rate shares of £1 each in issue.
2 At 31 March 2024, the Group held 1,738,561,954 (2023: 1,825,691,429) treasury shares with a nominal value of €289 million (2023: €304 million). The market value of shares held was
€1,434 million (2023: €1,855 million). During the year, 87,129,475 (2023: 85,844,124) treasury shares were reissued under Group share schemes and no (2023: 1,463,959,031) shares were
repurchased under the 2022 scheme which completed on 15 March 2023.
On 15 March 2024, the Group announced that the Board has approved the capital return through share buybacks of up to €2 billion of proceeds
from the sale of Vodafone Spain. This is expected to commence following the completion of the sale of Vodafone Spain.
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Notes to the consolidated financial statements (continued)
18. Reconciliation of net cash flow from operating activities
The table below shows how our profit for the year from continuing operations translates into cash flows generated
from our operating activities.
Re-presented1
Re-presented1
2024
2023
2022
Notes
€m
€m
€m
Profit for the financial year
1,505
12,335
2,773
Loss/(Profit) for the financial year from discontinued operations
65
247
(185)
Profit for the financial year from continuing operations
1,570
12,582
2,588
Investment income
5
(581)
(232)
(251)
Financing costs
5
2,626
1,609
1,842
Income tax expense
6
50
492
1,561
Operating profit
3,665
14,451
5,740
Adjustments for:
Share-based payments and other non-cash charges
98
58
165
Depreciation and amortisation
10, 11
10,414
10,255
10,417
Loss on disposal of property, plant and equipment and intangible assets
34
33
40
Share of result of equity accounted associates and joint ventures
12
96
(433)
(389)
Impairment (reversal)/loss
4
(64)
64
–
Other income
3
(372)
(9,402)
(244)
Decrease / (increase) in inventory
177
(168)
(171)
(Increase)/decrease in trade and other receivables
14
(597)
(486)
(629)
Increase/(decrease) in trade and other payables
15
534
1,446
581
Cash generated by operations
13,985
15,818
15,510
Net tax paid
(724)
(1,228)
(916)
Cashflows from discontinued operations
3,296
3,464
3,487
Net cash flow from operating activities
16,557
18,054
18,081
Note:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
19. Cash and cash equivalents
The majority of the Group’s cash is held in bank deposits or money market funds which have a maturity of three months
or less from acquisition to enable us to meet our short-term liquidity requirements.
Accounting policies
Cash and cash equivalents comprise cash and bank deposits, and other short-term highly liquid investments that are readily convertible to a known
amount of cash and are subject to an insignificant risk of changes in value. Assets in money market funds, whose contractual cash flows do not
represent solely payments of interest and principal, are measured at fair value with gains and losses arising from changes in fair value included in net
profit or loss for the period. All other cash and cash equivalents are measured at amortised cost.
2024
2023
€m
€m
Cash and bank deposits1
4,168
3,924
Money market funds2
2,015
7,781
Cash and cash equivalents as presented in the consolidated statement of financial position
6,183
11,705
Bank overdrafts
(111)
(77)
Cash and cash equivalents of discontinued operations
42
–
Cash and cash equivalents as presented in the consolidated statement of cash flows
6,114
11,628
Note:
1 Includes bank deposits under repurchase agreements of €2,034 million (2023: €1,750 million).
2 Items are measured at fair value and the valuation basis is level 1 classification, which comprises financial instruments where fair value is determined by unadjusted quoted prices in active
markets.
The carrying amount of balances at amortised cost approximates their fair value.
Cash and cash equivalents of €1,629 million (2023: €1,572 million) are held in countries with restrictions on remittances but where the balances
could be used to repay subsidiaries’ third party liabilities. In addition, those balances could also be used to repay €790 million (2023: €722 million)
of intercompany liabilities as at 31 March 2024.
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20. Leases
The Group leases assets from other parties (the Group is a lessee) and also leases assets to other parties (the Group is a
lessor). This note describes how the Group accounts for leases and provides details about its lease arrangements.
Accounting policies
As a lessee
When the Group leases an asset, a ‘right-of-use asset’ is recognised for the leased item and a lease liability is recognised for any lease payments to
be paid over the lease term at the lease commencement date. The right-of-use asset is initially measured at cost, being the present value of the
lease payments paid or payable, plus any initial direct costs incurred in entering the lease and less any lease incentives received.
Right-of-use assets are depreciated on a straight-line basis from the commencement date to the earlier of the end of the asset’s useful life or the
end of the lease term. The lease term is the non-cancellable period of the lease plus any periods for which the Group is ‘reasonably certain’ to
exercise any extension options (see below). The useful life of the asset is determined in a manner consistent to that for owned property, plant and
equipment (as described in note 11 ‘Property, plant and equipment’). If right-of-use assets are considered to be impaired, the carrying value is
reduced accordingly.
Lease liabilities are initially measured at the value of the lease payments over the lease term that are not paid at the commencement date and are
usually discounted using the incremental borrowing rates of the applicable Group entity (the rate implicit in the lease is used if it is readily
determinable). Lease payments included in the lease liability include both fixed payments and in-substance fixed payments during the term of the
lease.
After initial recognition, the lease liability is recorded at amortised cost using the effective interest method. It is remeasured when there is a change
in future lease payments arising from a change in an index or rate (e.g. an inflation related increase) or if the Group’s assessment of the lease term
changes; any changes in the lease liability as a result of these changes also results in a corresponding change in the recorded right-of-use asset
unless the right-of-use asset is reduced to zero in which case the remaining amount of the remeasurement is recognised in profit or loss.
Lease modifications that increase the scope of a lease by adding the right to use one or more underlying assets in return for consideration
commensurate with the stand-alone price for the additional lease components are treated as separate leases. If a lease modification decreases the
scope of the lease, the Group remeasures both the right-of-use asset and the lease liability and recognises any gain or loss in profit or loss. Other
lease modifications result in a remeasurement of the lease liability with an adjustment to the right-of-use asset. Remeasured lease liabilities are
discounted at the modification date using a current discount rate.
As a lessor
Where the Group is a lessor, it determines at inception whether the lease is a finance or an operating lease. When a lease transfers substantially all
the risks and rewards of ownership of the underlying asset then the lease is a finance lease; otherwise the lease is an operating lease.
Where the Group is an intermediate lessor, the interests in the head lease and the sublease are accounted for separately and the lease classification
of a sublease is determined by reference to the right-of-use asset arising from the head lease.
Income from operating leases is recognised on a straight-line basis over the lease term. Income from finance leases is recognised at lease
commencement with any interest income recognised over the lease term.
Lease income is recognised as revenue for transactions that are part of the Group’s ordinary activities (i.e. primarily leases of handsets or other
equipment to customers, leases of wholesale access to the Group’s fibre and cable networks and leases of tower infrastructure assets). The Group
uses IFRS 15 principles to allocate the consideration in contracts between any lease and non-lease components.
The Group’s leasing activities as a lessee
The Group leases buildings for its retail stores, offices and data centres, land on which to construct mobile base stations, space on mobile base
stations to place active RAN equipment and network space (primarily rack space or duct space). In addition, the Group leases fibre and other fixed
connectivity to provide internal connectivity for the Group’s operations and on a wholesale basis from other operators to provide fixed connectivity
services to the Group’s customers.
The Group’s general approach to determining lease term by class of asset is described in note 1 ‘Basis of preparation’ under ‘Critical accounting
judgements and key sources of estimation uncertainty’.
Most of the Group’s leases include future price increases through fixed percentage increases, indexation to inflation measures on a periodic basis or
rent review clauses. Other than fixed percentage increases the lease liability does not reflect the impact of these future increases unless the
measurement date has passed. The Group’s leases contain no material variable payments clauses other than those related to the number of
operators sharing space on third party mobile base stations.
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Notes to the consolidated financial statements (continued)
20. Leases (continued)
Optional lease periods
Where practicable the Group seeks to include extension or break options in leases to provide operational flexibility, therefore many of the Group’s
lease contracts contain optional periods. The Group’s policy on assessing and reassessing whether it is reasonably certain that the optional period
will be included in the lease term is described in note 1 ‘Basis of preparation’ under ‘Critical accounting judgements and key sources of estimation
uncertainty’.
After initial recognition of a lease, the Group only reassesses the lease term when there is a significant event or a significant change in
circumstances, which was not anticipated at the time of the previous assessment. Significant events or significant changes in circumstances could
include merger and acquisition or similar activity, significant expenditure on the leased asset not anticipated in the previous assessment, or detailed
management plans indicating a different conclusion on optional periods to the previous assessment. Where a significant event or significant change
in circumstances does not occur, the lease term and therefore lease liability and right-of-use asset value, will decline over time.
The Group’s cash outflow for leases in the year ended 31 March 2024 was €3,567 million (2023 re-presented1: €3,067 million, 2022 re-presented1:
€3,018 million) and absent significant future changes in the volume of the Group’s activities or other strategic or structural changes to the Group
resulting in the use of more or fewer owned assets, this level of cash outflow from leases would be expected to continue for future periods, subject
to contractual price increases. The future cash outflows included within lease liabilities are shown in the maturity analysis below. The maturity
analysis only includes the reasonably certain payments to be made; cash outflows in these future periods will likely exceed these amounts as
payments will be made on optional periods not considered reasonably certain at present and on new leases entered into in future periods.
The Group’s leases for customer connectivity are normally either under regulated access or network sharing or similar preferential access
arrangements and as a result the Group normally has significant flexibility over the term it can lease such connections for; generally the notice
period required to cancel the lease is less than the notice period included in the service contract with the end customer. As a result, the Group does
not have any significant cash exposure to optional periods on customer connectivity as the Group can cancel the lease when the service agreement
ends. In some circumstances the Group is committed to minimum spend amounts for connectivity leases, which are included within reported lease
liabilities.
Sale and leaseback
In the year ended 31 March 2023, the Group disposed of its interest in Vantage Towers A.G. (‘Vantage Towers’) into a new joint venture, Oak Holdings
1 GmbH (‘Oak’); Vodafone retained an interest of 64.2% in Oak, which owns 89.3% of Vantage Towers (see note 27 ‘Acquisitions and disposals’ for
additional details). The Group has agreements with Vantage Towers to lease back spaces on its towers (see note 30 ‘Related party transactions’). The
Group de-recognised assets related to the mobile base stations with a net book value of €4,793 million. A total net gain on disposal of €9,287
million was realised in the year ended 31 March 2023 as a result of the disposal of Vantage Towers; €680 million of this gain, reflecting the gain on
the proportion of sold towers retained through the leaseback, was recorded in the year ended 31 March 2023 as a reduction in the value of the
right-of-use asset recognised for the leaseback of tower space and will be realised as a reduction in depreciation over the term of the leaseback until
November 2028. Other sale and leaseback transactions entered into by the Group were not material, individually or in aggregate.
Amounts recognised in the primary financial statements in relation to lessee transactions
Right-of-use assets
The carrying value of the Group’s right-of-use assets, depreciation charge for the year and additions during the year are disclosed in note 11
‘Property, plant and equipment’.
Lease liabilities
The Group’s lease liabilities are disclosed in note 21 ‘Borrowings’. The maturity profile of the Group’s lease liabilities is as follows:
2024
2023
€m
€m
Within one year
2,603
3,452
In more than one year but less than two years
1,984
2,574
In more than two years but less than three years
1,599
2,200
In more than three years but less than four years
1,461
1,981
In more than four years but less than five years
1,129
1,810
In more than five years
2,366
3,240
11,142
15,257
Effect of discounting
(1,470)
(1,893)
Lease liability - as disclosed in note 21 ‘Borrowings’
9,672
13,364
At 31 March 2024 the Group has committed to enter into future lease contracts with future undiscounted lease payments of €1,339 million (31
March 2023 restated2: €1,491 million) which includes €1,031 million (31 March 2023: €1,171 million) of commitments to Vantage Towers A.G. for
tower leases which are due to commence over the period until March 2026 and which will be payable during the eight year lease term following the
commencement of respective individual leases.
Notes:
1 The cash outflows for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as
discontinued operations, decreasing the previously disclosed amounts by €1,412 million (2022: €1,320 million). See note 7 ‘Discontinued operations and assets held for sale’ for more
information.
2 The prior year comparative amount has been restated to reflect the commitments to Vantage Towers A.G. that were not previously reported.
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Interest expense on lease liabilities for the year is disclosed in note 5 ‘Investment income and financing costs’.
The Group has no material liabilities under residual value guarantees and makes no material variable payments not included in the lease liability.
The Group does not apply either the short term or low value expedient options in IFRS 16 ‘Leases’.
The Group’s leasing activities as a lessor
The Group has a wide range of lessor activities with consumer and enterprise customers, other telecommunication companies and other
companies. With consumer and enterprise customers, the Group generates lease income from the provision of handsets, routers and other
communications equipment. The Group provides wholesale access to the Group’s fibre and cable networks, leases out space on the Group’s owned
mobile base stations to other telecommunication companies and subleases certain retained mobile base station sites to telecommunication tower
companies. In addition, the Group subleases retail stores to franchise partners in certain markets and leases out surplus assets (e.g. vacant offices
and retail stores) to other companies.
Lessor transactions are classified as operating or finance leases based on whether the lease transfers substantially all of the risks and rewards
incidental to ownership of the asset. Leases are individually assessed, but generally, the Group’s lessor transactions in the year are classified as:
-
Operating leases where the Group provides wholesale access to its fibre and cable networks, provides routers or similar equipment to fixed
customers or is lessor of space on owned mobile base stations; and
-
Finance leases where the Group is sub-lessor of handsets or similar items in back-to-back arrangements or where surplus assets or certain
retained mobile base stations sites are sublet out for all or substantially all of the remaining head lease term.
The Group’s income as a lessor in the year is as follows:
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Operating leases
Lease revenue (note 2 ‘Revenue disaggregation and segmental analysis’)
463
673
673
Income from leases not recognised as revenue
38
37
36
Substantially all of the Group’s income as a lessor is operating lease income.
The committed amounts to be received from the Group’s operating leases are as follows:
Maturity
Within one
year
In one to two
years
In two to
three years
In three to four
years
In four to five
years
In more than
five years
Total
€m
€m
€m
€m
€m
€m
€m
Committed operating lease payments due to the Group
as a lessor
31 March 2024
296
121
29
16
9
20
491
31 March 2023 Re-presented2
275
114
30
14
7
4
444
31 March 2022 Re-presented2
487
234
153
126
113
342
1,455
The Group recognises a net investment in leases (receivables) as a result of providing finance leases as a lessor, which are disclosed in note 14
‘Trade and other receivables’. The maturity profile of the Group’s net investment in leases is as follows:
2024
2023
€m
€m
Within one year
106
111
In more than one year but less than two years
80
88
In more than two years but less than three years
56
67
In more than three years but less than four years
49
54
In more than four years but less than five years
35
47
In more than five years
17
39
343
406
Unearned finance income
(33)
(33)
Net investment in leases - as disclosed in note 14 ‘Trade and other receivables’
310
373
The Group has no material lease income arising from variable lease payments.
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations, decreasing the previously disclosed amounts of lease revenue and income from leases not recognised as revenue by €78 million (2022: €85 million) and €10 million (2022: €9 million),
respectively. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 The committed operating lease payments as of 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as
discontinued operations, decreasing the previously disclosed total amounts by €51 million (2022: €54 million). See note 7 ‘Discontinued operations and assets held for sale’ for more information.
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Notes to the consolidated financial statements (continued)
21. Borrowings
The Group’s sources of borrowing for funding and liquidity purposes come from a range of committed bank facilities
and through short-term and long-term issuances in the capital markets including bond and commercial paper issues
and bank loans. Liabilities arising from the Group’s lease arrangements are also reported in borrowings; see note 20
‘Leases’. We manage the basis on which we incur interest on debt between fixed interest rates and floating interest rates
depending on market conditions using interest rate derivatives. The Group enters into foreign exchange contracts to
mitigate the impact of exchange rate movements on certain monetary items.
Accounting policies
Interest-bearing loans and overdrafts are initially measured at fair value (which is equal to cost at inception), and are subsequently measured at
amortised cost, using the effective interest rate method. Where they are identified as a hedged item in a designated fair value hedge relationship, fair
value adjustments are recognised in accordance with our policy (see note 22 ‘Capital and financial risk management’). Any difference between the
proceeds net of transaction costs and the amount due on settlement or redemption of borrowings is recognised over the term of the borrowing.
Borrowings
2024
2023
€m
€m
Non-current borrowings
Bonds
39,451
39,512
Bank loans
402
487
Lease liabilities (note 20)
7,416
10,318
Other borrowings1
1,059
1,352
48,328
51,669
Current borrowings
Bonds
1,292
4,604
Bank loans
365
308
Lease liabilities (note 20)
2,256
3,046
Collateral liabilities
2,628
4,886
Bank borrowings secured against Indian assets
1,720
1,485
Other borrowings1
398
392
8,659
14,721
Borrowings
56,987
66,390
Note:
1 Includes €862 million (2023: €1,140 million) and €158 million (2023: €196 million) of licence and spectrum fees payable in non-current and current borrowings respectively.
The fair value of the Group’s financial liabilities held at amortised cost approximate to fair value with the exception of long-term bonds with a
carrying value of €39,451 million (2023: €39,512 million) which have a fair value of €35,885 million (2023: €35,044 million). Fair value is based on
level 1 of the fair value hierarchy using quoted market prices.
The Group’s current borrowings also include €1,720 million (2023: €1,485 million) of bank borrowings that are secured against the Group’s
shareholdings in Indus Towers and Vodafone Idea (see note 12 ‘Investments in Associates and Joint Ventures’ for further details of these assets) and
will be repaid through the realisation of proceeds from those assets. This arrangement contains an embedded derivative option which has been
separately fair valued and is presented within derivative assets in current assets (see note 14 ‘Trade and other receivables’).
The Group’s borrowings, which include certain bonds that have been designated in hedge relationships, are carried at €1,229 million higher (2023:
€1,282 million higher) than their euro equivalent redemption value. In addition, where bonds are issued in currencies other than euros, the Group
has entered into foreign currency swaps to fix the euro cash outflows on redemption. The impact of these swaps is not reflected in borrowings and
would decrease the euro equivalent redemption value of the bonds by €1,559 million (2023: €1,440 million).
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Commercial paper programmes
The Group currently have US and euro commercial paper programmes of US$15 billion (€13.9 billion) and €10 billion respectively which are
available to be used to meet short-term liquidity requirements. At 31 March 2024 both programmes remained undrawn.
The commercial paper facilities were supported by US$4.0 billion (€3.7 billion) and €4.1 billion of syndicated committed bank facilities. No amounts
had been drawn under these facilities.
Bonds
We have two €30 billion euro medium-term note programmes and a US shelf programme which are used to meet medium to long-term funding
requirements. At 31 March 2024 the total amounts in issue under these programmes split by currency were US$19.7 billion, €15.0 billion, £4.1
billion, AUS$0.5 billion, HKD$2.1 billion, NOK2.2 billion, CHF0.7 billion and JPY10.0 billion.
At 31 March 2024 the Group had bonds outstanding with a nominal value equivalent to €39.5 billion. During the year ended 31 March 2024,
bonds with a nominal value of €0.8 billion and £0.5 billion (€0.6 billion) were issued utilising the euro medium-term note programme.
During the year bonds with nominal value €1.6 billion and US$0.3 billion (€0.3 billion) were re-purchased and bonds with a nominal value
€1.8 billion and US$ 1.3 billion (€1.2 billion) matured.
Bonds mature between 2024 and 2063 (2023: 2023 and 2063) and have interest rates between 0.375% and 8% (2023: 0.375% and 7.875%).
Mandatory convertible bonds
In March 2023 the Group concluded the last remaining share buybacks related to its mandatory convertible bonds (‘MCBs’) issuances, for which the
last outstanding tranche had matured during 2022. As at 31 March 2024, no further MCBs or related instruments remain outstanding.
Treasury shares
The Group held a maximum of 1,825,624,610 (2023: 1,825,691,429) of its own shares during the year which represented 6.3% (2023: 6.3%) of
issued share capital at that time.
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Notes to the consolidated financial statements (continued)
22. Capital and financial risk management
This note details the treasury management and financial risk management objectives and policies, as well as
the exposure and sensitivity of the Group to credit, liquidity, interest and foreign exchange risk, and the policies in place
to monitor and manage these risks.
Accounting policies
Financial instruments
Financial assets and financial liabilities, in respect of financial instruments, are recognised on the Group’s consolidated statement of financial
position when the Group becomes a party to the contractual provisions of the instrument.
Financial liabilities and equity instruments
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements entered
into and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that provides a residual interest in the
assets of the Group after deducting all of its liabilities and includes no obligation to deliver cash or other financial assets. The accounting policies
adopted for specific financial liabilities and equity instruments are set out below.
Derivative financial instruments and hedge accounting
The Group’s activities expose it to the financial risks of changes in foreign exchange rates and interest rates which it manages using derivative
financial instruments. The use of financial derivatives is governed by the Group’s policies approved by the Board of Directors, which provide written
principles on the use of financial derivatives consistent with the Group’s risk management strategy. The Group does not use derivative financial
instruments for speculative purposes.
The Group designates certain derivatives as:
− hedges of the change in fair value of recognised assets and liabilities (‘fair value hedges’);
− hedges of highly probable forecast transactions or hedges of foreign currency or interest rate risks of firm commitments (‘cash flow hedges’); or
− hedges of net investments in foreign operations.
Derivative financial instruments are initially measured at fair value on the contract date and are subsequently re-measured to fair value at each
reporting date. Changes in values of all derivatives of a financing nature are included within investment income and financing costs in the income
statement unless designated in an effective cash flow hedge relationship or a hedge of a net investment in foreign operations when the effective
portion of changes in value are deferred to other comprehensive income. Hedge effectiveness is determined at the inception of the hedge
relationship, and through periodic prospective effectiveness assessments to ensure that an economic relationship exists between the hedged item
and hedging instrument. For fair value hedges, the carrying value of the hedged item is also adjusted for changes in fair value for the hedged risk,
with gains and losses recognised in the income statement.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, exercised or no longer qualifies for hedge
accounting. When hedge accounting is discontinued, any gain or loss recognised in other comprehensive income at that time remains in equity and
is recognised in the income statement when the hedged transaction is ultimately recognised in the income statement.
For cash flow hedges, when the hedged item is recognised in the income statement, amounts previously recognised in other comprehensive
income and accumulated in equity for the hedging instrument are reclassified to the income statement. However, when the hedged transaction
results in the recognition of a non-financial asset or a non-financial liability, the gains and losses previously recognised in other comprehensive
income and accumulated in equity are transferred from equity and included in the initial measurement of the cost of the non-financial asset or
non-financial liability. If a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is recognised immediately in
the income statement.
For net investment hedges, gains and losses accumulated in other comprehensive income are included in the income statement when the foreign
operation is disposed of.
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Capital management
The following table summarises the capital of the Group at 31 March:
2024
2023
€m
€m
Borrowings (note 21)
56,987
66,390
Cash and cash equivalents (note 19)
(6,183)
(11,705)
Derivative financial instruments included in trade and other receivables (note 14)
(4,226)
(6,124)
Derivative financial instruments included in trade and other payables (note 15)
1,524
1,422
Short-term investments (note 13)
(3,225)
(4,305)
Collateral assets (note 13)
(741)
(239)
Financial liabilities under put option arrangements
–
485
Equity
60,998
64,483
Capital
105,134
110,407
The Group’s policy is to borrow centrally using a mixture of long-term and short-term capital market issues and borrowing facilities to meet
anticipated funding requirements. These borrowings, together with cash generated from operations, are loaned internally or contributed as equity
to certain subsidiaries.
Dividends from joint ventures and associates and to non-controlling shareholders
Dividend policies within shareholder agreements for certain of the Group’s associates and joint ventures give the Group certain rights to receive
dividends but are generally paid at the discretion of the Board of Directors or shareholders. We do not have existing obligations to pay dividends to
non-controlling interest partners of our subsidiaries. The amount of dividends received and paid in the year are disclosed in the consolidated
statement of cash flows.
Sale of trade receivables
During the year, the Group sold certain trade receivables to a number of financial institutions. Whilst there are no repurchase obligations in respect
of these receivables, the Group provided credit guarantees which would only become payable if default rates were significantly higher than
historical rates. The credit guarantee is not considered substantive and substantially all risks and rewards associated with the receivables passed to
the purchaser at the date of sale, therefore the receivables were derecognised. The maximum payable under the guarantees at 31 March 2024 was
€1,929 million (2023: €1,927 million). No provision has been made in respect of these guarantees as the likelihood of a cash outflow has been
assessed as remote.
Supplier financing arrangements
The Group offers suppliers the opportunity to use supply chain financing (‘SCF’). SCF allows suppliers that decide to use it to receive funding earlier
than the invoice due date. At 31 March 2024, the financial institutions that run the SCF programmes had purchased €2.2 billion (2023: €2.4 billion)
of outstanding supplier invoices, principally from larger suppliers. The Group does not provide any financial guarantees to the financial institutions
under this programme and continues to cash settle supplier payables in accordance with their contractual terms. As such, the programme does not
change the Group’s net debt, trade payable balances or cash flows.
The Group evaluates supplier arrangements against a number of indicators to assess if the payable continues to hold the characteristics of a trade
payable or should be classified as borrowings; these indicators include whether the payment terms exceed the shorter of customary payment terms
in the industry or 180 days. At 31 March 2024, none of the payables subject to supplier financing arrangements met the criteria to be reclassified as
borrowings.
Financial risk management
The Group’s treasury function centrally manages the Group’s funding requirement, net foreign exchange exposure, interest rate management
exposures and counterparty risk arising from investments and derivatives. Treasury operations are conducted within a framework of policies and
guidelines authorised and reviewed by the Board, most recently in March 2024. A treasury risk committee comprising of the Group’s Chief Financial
Officer, Group General Counsel and Company Secretary, Group Corporate Finance Director, Group Treasury Director and Group Director of Financial
Controlling and Operations meets three times a year to review treasury activities and its members receive management information relating to
treasury activities on a quarterly basis. The Group’s Internal Auditor reviews the internal control environment regularly.
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Notes to the consolidated financial statements (continued)
22. Capital and financial risk management (continued)
No bonds issued by the Group or the Revolving Credit Facilities are subject to financial covenant ratios. Approximately €32 billion (2023: €35 billion)
of issued bonds have a change of control clause. The Group uses derivative instruments for currency and interest rate risk management purposes that
are transacted by specialist treasury personnel. The Group mitigates banking sector credit risk by the use of collateral support agreements.
The Group’s financial risk management policies seek to reduce the Group’s exposure to any future disruption to financial markets, including any
future impacts from global economic and political uncertainty and other macro economic events.
The Group has combined cash and cash equivalent and short-term investments of €9.4 billion, providing significant headroom over short-term
liquidity requirements. Additionally the Group maintains undrawn revolving credit facilities of €7.8 billion euro equivalent. As at 31 March 2024 and
after hedging, substantially all the Group’s borrowings are held on a fixed interest basis, mitigating exposure to interest rate risk. The Group has no
significant currency exposures other than positions in economic hedging relationships. The Group’s credit risk under financing activities is spread
across a portfolio of highly rated institutions to reduce counterparty exposures and derivative balances are substantially all collateralised. The
Group’s operating activities result in customer credit risk, for which provisions for expected credit losses are recognised.
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial asset leading to a financial loss for the Group. The Group is
exposed to credit risk from its operating activities and from its financing activities, the Group considers its maximum exposure to credit risk at 31
March to be:
2024
2023
€m
€m
Cash and bank deposits (note 19)
4,168
3,924
Money market funds (note 19)
2,015
7,781
Managed investment funds (note 13)
2,024
2,967
Bonds and debt securities (note 13)
2,142
2,337
Collateral assets (note 13)
741
239
Other investments (note 13)
1,126
2,473
Derivative financial instruments (note 14)
4,226
6,124
Trade receivables (note 14)1
5,513
6,158
Contract assets and other receivables (note 14)
4,067
4,353
Financial Guarantees2
2,038
3,381
28,060
39,737
Note:
1 Includes amounts guaranteed under sales of trade receivables €1,929 million (2023: €1,927 million).
2 Principally comprises Vodafone Group Plc’s guarantee of the Group’s share in a multicurrency loan facility, amounting to US$1 billion and €0.6 billion (2023: US$1.75 billion), which forms
part of its overall joint venture investment in TPG Telecom Ltd. The Group’s share of these loan balances is included in the net investment in joint venture (see note 12 'Investments in
associates and joint arrangements'). Financial guarantees also includes INR42.5 billion (2023: INR42.5 billion) in relation to the secondary pledge over shares owned by Vodafone Group in
Indus Towers (see note 29 'Contingent liabilities and legal proceedings').
Expected credit loss
The Group has financial assets classified and measured at amortised cost and fair value through other comprehensive income that are subject to the
expected credit loss model requirements of IFRS 9. Cash and bank deposits and certain other investments are both classified and measured at
amortised cost and subject to impairment requirements. However, the identified expected credit loss is considered to be immaterial.
Information about expected credit losses for trade receivables and contract assets can be found under ‘Operating activities’ on page 195.
Financing activities
The Group invests in government securities on the basis they generate a fixed rate of return and are amongst the most creditworthy of investments
available.
Investments are made in accordance with established internal treasury policies which dictate the scaled maximum exposure permissible in relation
to an investment’s long-term credit rating. The Group invests in AAA unsecured money market mutual funds, where the investment is limited to
10% of each fund; A to AAA government securities, both directly and through money market mutual funds; and has two managed investment funds
that hold securities with an average credit quality of AA.
In respect of financial instruments used by the Group’s treasury function, the aggregate credit risk the Group may have with one counterparty is
limited by reference to the long-term credit ratings assigned for that counterparty by Moody’s, Fitch Ratings and Standard & Poor’s. Furthermore,
collateral support agreements reduce the Group’s exposure to counterparties who must post collateral when there is value due to the Group under
outstanding derivative contracts that exceeds a contractually agreed threshold amount. When value is due to the counterparty the Group is
required to post collateral on identical terms. Such cash collateral is adjusted daily as necessary.
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In the event of any default, ownership of the collateral would revert to the respective holder at that point. Detailed below is the value of the cash
collateral, which is reported within current borrowings, held by the Group at 31 March:
2024
2023
€m
€m
Collateral liabilities
2,628
4,886
In addition, as discussed in note 29 ‘Contingent liabilities and legal proceedings’, the Group has covenanted to provide security in favour of the
trustee of the Vodafone Group UK Pension Scheme in respect of the funding deficit in the scheme and pledged security in relation to the Indus
Towers merger. The Group has also pledged cash as collateral against derivative financial instruments as disclosed in note 13 ‘Other investments’.
Operating activities
Customer credit risk is managed by the Group’s business units which each have policies, procedures and controls relating to customer credit risk
management. Outstanding trade receivables and contract assets are regularly reviewed to monitor any changes in credit risk with concentrations of
credit risk considered to be limited given that the Group’s customer base is large and unrelated. The Group applies the simplified approach and
records lifetime expected credit losses for trade receivables and contract assets. Expected credit losses are measured using historical cash
collection data for periods of at least 24 months wherever possible and grouped into various customer segments based on product or customer
type. The historical loss rates are adjusted where macroeconomic factors, for example changes in interest rates or unemployment rates, or other
commercial factors are expected to have a significant impact when determining future expected credit loss rates. For trade receivables the expected
credit loss provision is calculated using a provision matrix, in which the provision increases as balances age, and for receivables paid in instalments
and contract assets a weighted loss rate is calculated to reflect the period over which the amounts become due for payment by the customer. Trade
receivables and contract assets are written off when each business unit determines there to be no reasonable expectation of recovery and
enforcement activity has ceased.
Movements in the allowance for expected credit losses during the year were as follows:
Trade receivables held
Trade receivables held
at fair value through
Contract assets
at amortised cost
other comprehensive income
Re-presented1
Re-presented1
Re-presented1
2024
2023
2024
2023
2024
2023
€m
€m
€m
€m
€m
€m
1 April
78
83
1,149
1,342
71
108
Exchange movements
(1)
(3)
(41)
(72)
1
1
Amounts charged to credit losses on financial assets
96
128
419
360
82
17
Transfer of assets held for sale
(31)
6
(324)
256
(16)
2
Other2
(122)
(136)
(438)
(737)
(60)
(57)
31 March
20
78
765
1,149
78
71
Notes:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ for more information.
2 Primarily utilisation of the provision by way of write-off.
Expected credit losses are presented as net credit losses on financial assets within operating profit and subsequent recoveries of amounts
previously written off are credited against the same line item.
The majority of the Group’s trade receivables are due for maturity within 90 days and largely comprise amounts receivable from consumers and business
customers. The table below presents information on trade receivables past due¹ and their associated expected credit losses:
31 March 2024
Trade receivables at amortised cost past due
30 days
31–60
61–180
180
Total
Due
or less
days
days
days+
€m
€m
€m
€m
€m
€m
Gross carrying amount
2,199
347
122
308
638
3,614
Expected credit loss allowance
(52)
(56)
(26)
(111)
(520)
(765)
Net carrying amount
2,147
291
96
197
118
2,849
31 March 2023
Trade receivables at amortised cost past due
30 days
31–60
61–180
180
Total
Due
or less
days
days
days+
€m
€m
€m
€m
€m
€m
Gross carrying amount
2,465
599
163
329
957
4,513
Expected credit loss allowance
(67)
(64)
(50)
(173)
(831)
(1,185)
Net carrying amount
2,398
535
113
156
126
3,328
Note:
1 Contract assets relate to amounts not yet due from customers. These amounts will be reclassified as trade receivables before they become due. Trade receivables at fair value through other
comprehensive income are not materially past due.
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Notes to the consolidated financial statements (continued)
22. Capital and financial risk management (continued)
Liquidity risk
Liquidity is reviewed daily on at least a 12 month rolling basis and stress tested on the assumption that any commercial paper outstanding matures
and is not reissued. The Group maintains substantial cash and cash equivalents which at 31 March 2024 amounted to cash €6.2 billion (2023: €11.7
billion) and undrawn committed facilities of €8.0 billion (2023: €8.0 billion), principally US dollar and euro revolving credit facilities of US$4.0 billion
(€3.7 billion) and €4.1 billion and which mature in 2028 and 2029 respectively. The Group manages liquidity risk on non-current borrowings by
maintaining a varied maturity profile with a cap on the level of debt maturity in any one calendar year, therefore minimising refinancing risk. Non-
current borrowings mature between 1 and 39 years.
The maturity profile of the anticipated future cash flows including interest in relation to the Group’s non-derivative financial liabilities on an
undiscounted basis which, therefore, differs from both the carrying value and fair value, is as follows:
Maturity profile1
Trade payables and
other financial
Bank loans
Bonds
Lease liabilities
Other2
Total borrowings
liabilities3
Total
€m
€m
€m
€m
€m
€m
€m
Within one year
365
2,871
2,603
4,747
10,586
10,891
21,477
In one to two years
140
5,860
1,984
247
8,231
128
8,359
In two to three years
27
5,608
1,599
245
7,479
–
7,479
In three to four years
91
2,310
1,461
226
4,088
–
4,088
In four to five years
161
3,437
1,129
422
5,149
–
5,149
In more than five years
72
40,826
2,366
277
43,541
–
43,541
856
60,912
11,142
6,164
79,074
11,019
90,093
Effect of discount/financing rates
(89)
(20,169)
(1,470)
(359)
(22,087)
(7)
(22,094)
31 March 2024
767
40,743
9,672
5,805
56,987
11,012
67,999
Within one year
308
6,234
3,452
6,764
16,758
15,370
32,128
In one to two years
235
3,070
2,574
423
6,302
51
6,353
In two to three years
110
5,725
2,200
259
8,294
–
8,294
In three to four years
18
5,500
1,981
258
7,757
–
7,757
In four to five years
70
2,212
1,810
233
4,325
–
4,325
In more than five years
128
42,325
3,240
599
46,292
–
46,292
869
65,066
15,257
8,536
89,728
15,421
105,149
Effect of discount/financing rates
(74)
(20,950)
(1,893)
(421)
(23,338)
(3)
(23,341)
31 March 2023
795
44,116
13,364
8,115
66,390
15,418
81,808
Notes:
1 Maturities reflect contractual cash flows applicable except in the event of a change of control or event of default, upon which lenders have the right, but not the obligation, to request
payment within 30 days. This also applies to undrawn committed facilities. There is no debt that is subject to a material adverse change clause. Where there is a choice of contractual cash
flow dates, principally on ‘hybrid bonds’, the expected settlement date is used.
2 Includes spectrum licence payables with maturity profile €153 million (2023: €196 million) within one year, €187 million (2023: €170 million) in one to two years, €187 million (2023: €199
million) in two to three years, €187 million (2023: €199 million) in three to four years, €187 million (2023: €199 million) in four to five years and €276 million (2023: €587 million) in more
than five years. Also includes €2,628 million (2023: €4,886 million) in relation to cash received under collateral support agreements shown within 1 year.
3 Includes financial liabilities under put option arrangements and non-derivative financial liabilities presented within trade and other payables.
The maturity profile of the Group’s financial derivatives (which include interest rate swaps, cross-currency interest rate swaps and foreign exchange
swaps) using undiscounted cash flows, is as follows:
2024
2023
Payable1
Receivable1
Total
Payable1
Receivable1
Total
€m
€m
€m
€m
€m
€m
Within one year
(7,181)
7,886
705
(17,845)
18,527
682
In one to two years
(4,984)
5,466
482
(3,534)
4,055
521
In two to three years
(5,496)
5,910
414
(4,028)
4,441
413
In three to four years
(2,457)
2,909
452
(2,186)
2,567
381
In four to five years
(3,451)
4,020
569
(2,265)
2,681
416
In more than five years
(40,415)
46,561
6,146
(38,494)
44,586
6,092
(63,984)
72,752
8,768
(68,352)
76,857
8,505
Effect of discount/financing rates
(6,066)
(3,803)
Financial derivative net receivable
2,702
4,702
Note:
1 Payables and receivables are stated separately in the table above where cash settlement is on a gross basis.
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Other information
Market risk
Interest rate management
Under the Group’s interest rate management policy, interest rates on long-term monetary assets and liabilities are principally maintained on a fixed
rate basis.
At 31 March 2024 and after hedging, substantially all of our outstanding liabilities are held on a fixed interest rate basis in accordance with treasury
policy.
For each one hundred basis point rise in market interest rates for all currencies in which the Group had borrowings at 31 March 2024 there would be
an increase in profit before tax by €13 million (2023: €27 million) including mark to market revaluations of interest rate and other derivatives and
the potential interest on cash and short-term investments. There would be no material impact on equity.
At 31 March 2024, the Group had limited exposure through interest rate derivatives and floating rate bonds referencing LIBOR and other interbank
offered rates (IBORs).
Foreign exchange management
As Vodafone’s primary listing is on the London Stock Exchange its share price is quoted in sterling. Since the sterling share price represents the
value of its future multi-currency cash flows, principally in euro, South African rand and sterling, the Group maintains the currency of debt and
interest charges in proportion to its expected future principal cash flows and has a policy to hedge external foreign exchange risks on transactions
denominated in other currencies above a certain de minimis level.
At 31 March 2024 6% of net debt was denominated in currencies other than euro (4% South African rand and 2% other). This allows South African
rand to be serviced in proportion to expected future cash flows and therefore provides a partial economic hedge against income statement
translation exposure.
Under the Group’s foreign exchange management policy, foreign exchange transaction exposure in Group companies is generally maintained at the
lower of €5 million per currency per month or €15 million per currency over a six month period.
The Group recognises foreign exchange movements in equity for the translation of net investment hedging instruments and balances treated as
investments in foreign operations. However, there is no net impact on equity for exchange rate movements on net investment hedging instruments
as there would be an offset in the currency translation of the foreign operation. At 31 March 2024 the Group held financial liabilities in a net
investment hedge against the Group’s South African rand operations. Sensitivity to foreign exchange movements on the hedging liabilities,
analysed against a strengthening of the South African rand by 10% (2023: 12%) would result in a decrease in equity of €154 million (2023:
€267million) which would be fully offset by foreign exchange movements on the hedged net assets. In addition, cash flow hedges of principally US
dollar borrowings would result in an increase in equity of €73 million (2023: €204 million) against a strengthening of US dollar by 3% (2023: 5%).
The Group income statement is exposed to foreign exchange risk from both the generation of profits and losses in currencies other than euro and
from the translation of balance sheet items not held in functional currency.
The following table details the Group’s sensitivity to foreign exchange risk. The percentage movement applied to the currency is based on the
average movements in the previous three annual reporting periods.
2024
2023
€m
€m
Increase/ (decrease) in Profit before taxation
EGP 43% change (2023: 27%)
191
116
TRY 54% change (2023: 43%)
104
33
ZAR 10% change (2023: 12%)
60
87
GBP 2% change (2023: 3%)
(50)
(46)
Equity risk
As noted on page 201, the Group has an embedded derivative option with valuation inputs that include the quoted share prices for Indus Towers
and Vodafone Idea. The Group’s sensitivity to a 40% increase / decrease in the combined share price input to the option valuation model would
result in a decrease / increase in profit before tax of €19 million / €137 million (2023: €116m / €445 million). The percentage sensitivity applied is
based on the 12month volatility of the combined share prices.
There is no material equity risk relating to the Group’s equity investments which are detailed in note 13 ‘Other investments’.
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Notes to the consolidated financial statements (continued)
22. Capital and financial risk management (continued)
Risk management strategy of hedge relationships
The risk strategies of the designated cash flow, fair value, and net investment hedges reflect the above market risk strategies.
The objective of the cash flow hedges is principally to convert foreign currency denominated fixed rate borrowings in US dollar, pound sterling,
Australian dollar, Swiss franc, Hong Kong dollar, Japanese yen, Norwegian krona and US dollar floating rate borrowings into euro fixed rate
borrowings and hedge the foreign exchange spot rate and interest rate risk. There are also cash flow hedges of certain subsidiary expenditure not
denominated in functional currency of the entity, to hedge foreign exchange spot risk. Derivative financial instruments designated in cash flow
hedges are cross-currency interest rate swaps and foreign exchange swaps and forwards. The swap maturity dates and liquidity profiles of the
nominal cash flows match those of the underlying borrowings and exposures.
The objective of the net investment hedges is to hedge foreign exchange risk in foreign operations. Derivative financial instruments designated in
net investment hedges are cross-currency interest rate swaps and foreign exchange swaps. The hedging instruments are rolled on an ongoing basis
as determined by the nature of the business.
Hedge effectiveness is determined at the inception of the hedge relationship and through periodic prospective effectiveness assessments to ensure
that an economic relationship exists between the hedged item and hedging instrument.
For hedges of foreign currency denominated borrowings and investments, the Group uses a combination of cross-currency and foreign exchange
swaps to hedge its exposure to foreign exchange risk and interest rate risk and enters into hedge relationships where the critical terms of the
hedging instrument match with the terms of the hedged item. Therefore the Group expects a highly effective hedging relationship with the swap
contracts and the value of the corresponding hedged items to change systematically in the opposite direction in response to movements in the
underlying exchange rates and interest rates. The Group therefore performs a qualitative assessment of effectiveness. If changes in circumstances
affect the terms of the hedged item such that the critical terms no longer match with the critical terms of the hedging instrument, the Group uses
the hypothetical derivative method to assess effectiveness.
Hedge ineffectiveness may occur due to:
a) The fair value of the hedging instrument on the hedge relationship designation date if the fair value is not nil;
b) Changes in the contractual terms or timing of the payments on the hedged item; and
c) A change in the credit risk of the Group or the counterparty with the hedging instrument.
The hedge ratio for each designation will be established by comparing the quantity of the hedging instrument and the quantity of the hedged item
to determine their relative weighting; for all of the Group’s existing hedge relationships the hedge ratio has been determined as 1:1.
The fair values of the derivative financial instruments are calculated by discounting the future cash flows to net present values using appropriate
market rates and foreign currency rates prevailing at 31 March. The valuation basis is level 2 of the fair value hierarchy. This classification comprises
items where fair value is determined from inputs other than quoted prices that are observable for the asset and liability, either directly or indirectly.
Derivative financial assets and liabilities are included within trade and other receivables and trade and other payables in the statement of financial
position.
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Other information
The following table represents the carrying values and nominal amounts of derivatives in a continued hedge relationship as at 31 March.
At 31 March 2024
Other comprehensive income
Weighted average
Opening
(Gain)/
Gain/(Loss)
Closing
Carrying
Carrying
balance
Loss
recycled to
balance
Euro
Nominal
value
value
1 April
deferred to
financing
31 March
Maturity
interest
amounts
assets
liabilities
2023
OCI
costs
20241
year
FX rate
rate
€m
€m
€m
€m
€m
€m
€m
%
Cash flow hedges - foreign currency risk2
Cross-currency and foreign exchange
swaps:
- US dollar bonds
16,756
2,689
188
(2,709)
1,775
124
(810) 2039
1.18
3.29
- Australian dollar bonds
288
–
2
(21)
14
(6)
(13) 2027
1.56
1.57
- Swiss franc bonds
624
80
–
(3)
(22)
15
(10) 2026
1.08
1.57
- Pound sterling bonds
4,771
45
362
(37)
244
126
333 2043
0.86
4.05
- Hong Kong dollar bonds
233
20
–
(5)
2
3
– 2028
9.08
1.92
- Japanese yen bonds
78
–
11
(12)
15
(9)
(6) 2037
128.53
2.47
- Norwegian krona bonds
241
–
47
(12)
13
(6)
(5) 2026
9.15
1.12
- Foreign exchange forwards3
287
–
42
(34)
(15)
7
(42) 2024
29.88
–
Cash flow hedges - foreign currency and
interest rate risk2
Cross currency swaps - US dollar bonds
–
–
–
(11)
11
–
–
–
–
–
Net investment hedge - foreign
exchange risk4
Cross currency and foreign exchange
swaps - South African rand investment
1,505
176
–
952
(54)
–
898 2026
17.81
2.19
24,783
3,010
652
(1,892)
1,983
254
345
At 31 March 2023
Other comprehensive income
Weighted average
Opening
(Gain)/
Gain/(Loss)
Closing
Carrying
Carrying
balance
Loss
recycled to
balance
Euro
Nominal
value
value
1 April
deferred to
financing
31 March
Maturity
interest
amounts
assets
liabilities
2022
OCI
costs
20231
year
FX rate
rate
€m
€m
€m
€m
€m
€m
€m
%
Cash flow hedges - foreign currency risk2
Cross-currency and foreign exchange
swaps hedging:
- US dollar bonds
17,690
4,456
–
(1,484)
(2,321)
1,096
(2,709)
2038
1.18
3.14
- Australian dollar bonds
288
13
–
(5)
31
(47)
(21)
2027
1.56
1.57
- Swiss franc bonds
624
58
–
20
(43)
20
(3)
2026
1.08
1.26
- Pound sterling bonds
4,195
61
152
109
6
(152)
(37)
2044
0.86
3.15
- Hong Kong dollar bonds
233
22
–
7
(17)
5
(5)
2028
9.08
1.48
- Japanese yen bonds
78
3
–
2
(9)
(5)
(12)
2037
128.53
2.47
- Norwegian krona bonds
241
–
34
3
17
(32)
(12)
2026
9.15
1.12
- Foreign exchange forwards3
383
–
34
(69)
34
1
(34)
2023
18.92
–
Cash flow hedges - foreign currency and
interest rate risk2
Cross currency swaps - US dollar bonds
417
49
–
(1)
(20)
10
(11)
2023
1.17
1.07
Net investment hedge - foreign
exchange risk4
Cross currency and foreign exchange
swaps - South African rand investment
2,004
96
–
1,133
(181)
–
952
2025
18.23
1.83
26,153
4,758
220
(285) (2,503)
896
(1,892)
Notes:
1 Fair value movement deferred into other comprehensive income includes €251 million loss (2023: €383 million loss) and €10 million gain (2023: €17 million gain) of foreign currency basis outside the
cash flow and net investment hedge relationships respectively.
2 For cash flow hedges, the movement in the hypothetical derivative (hedged item) mirrors that of the hedging instrument. Hedge ineffectiveness of the swaps designated in a cash flow hedge during the
period was €67 million (2023: €nil).
3 Includes euro and US dollar forward contracts against Turkish lira to hedge foreign currency forecast expenditures in local markets. Notional amounts of €166 million (2023: €259 million) and $130 million
or €121 million equivalent (2023: $134 million or €124 million equivalent) with weighted average exchange rates of 29.68 (2023: 18.36) and 30.15 (2023: 20.07) respectively to Turkish lira.
4 Hedge ineffectiveness of swaps designated in a net investment hedge during the period was €nil (2023: €nil).
The carrying value of bonds includes an additional €710 million loss (2023: €776 million loss) in relation to fair value of other bonds
previously designated in fair value hedge relationships.
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Other information
Notes to the consolidated financial statements (continued)
22. Capital and financial risk management (continued)
Changes in assets and liabilities arising from financing activities
Borrowings
Derivative assets and
liabilities
Financial liabilities
under put options
Other liabilities
Assets and liabilities
arising from financing
activities
€m
€m
€m
€m
€m
31 March 2023
66,390
(4,702)
485
103
62,276
Cash movements
Proceeds from issuance of long-term borrowings
1,533
–
–
–
1,533
Repayment of borrowings1
(10,106)
–
–
–
(10,106)
Net movement in short-term borrowings
(1,636)
–
–
–
(1,636)
Net movement in derivatives
–
144
–
–
144
Interest paid1
(2,531)
272
(17)
(54)
(2,330)
Purchase of treasury shares
–
–
–
–
–
Other
–
–
(493)
–
(493)
Non-cash movements
Fair value movements
–
2,233
–
–
2,233
Foreign exchange
61
(231)
–
1
(169)
Interest costs2
2,766
(395)
13
56
2,440
Lease additions
3,915
–
–
–
3,915
Transfer of assets and liabilities held for sale
(3,455)
(23)
–
(1)
(3,479)
Other
50
–
12
–
62
31 March 2024
56,987
(2,702)
–
105
54,390
Borrowings
Derivative assets and
liabilities
Financial liabilities
under put options
Other liabilities
Assets and liabilities
arising from financing
activities
€m
€m
€m
€m
€m
1 April 2022
70,092
(2,954)
494
1,498
69,130
Cash movements
Proceeds from issuance of long-term borrowings
4,071
–
–
–
4,071
Repayment of borrowings1
(13,538)
–
–
–
(13,538)
Net movement in short-term borrowings
3,172
–
–
–
3,172
Net movement in derivatives
–
261
–
–
261
Interest paid1
(2,444)
590
(18)
(79)
(1,951)
Purchase of treasury shares
–
–
–
(1,867)
(1,867)
Other
–
–
(12)
–
(12)
Non-cash movements
Fair value movements
–
(1,688)
–
–
(1,688)
Foreign exchange
(44)
(350)
–
(20)
(414)
Interest costs2
2,657
(561)
21
(113)
2,004
Lease additions
7,652
–
–
–
7,652
Acquisition and disposal of subsidiaries
(5,243)
–
–
–
(5,243)
Other3
15
–
–
684
699
31 March 2023
66,390
(4,702)
485
103
62,276
Note:
1 Includes €1,136 million (2023: €3,037 million) in Repayment of borrowings and €103 million (2023: €136 million) in Interest paid that are presented within Cash outflows from discontinued
operations in the Consolidated statement of cash flows.
2 Includes €111 million (2023: €103 million) of Interest costs presented within Discontinued operations in the Consolidated income statement.
3 Movement in Other liabilities primarily relate to share buyback programmes.
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Other information
Fair value and carrying value information
The carrying value and valuation basis of the Group’s financial assets are set out in notes 13 ‘Other investments’, 14 ‘Trade and other receivables’
and 19 ‘Cash and cash equivalents’. For all financial assets held at amortised cost the carrying values approximate fair value except as disclosed in
note 13 ‘Other investments’.
The carrying value and valuation basis of the Group’s financial liabilities are set out in notes 15 ‘Trade and other payables’ and 21 ‘Borrowings’. The
carrying values approximate fair value for the Group’s trade payables and other payables categories. For other financial liabilities a comparison of fair
value and carrying value is disclosed in note 21 ‘Borrowings’.
Level 3 financial instruments
The Group’s borrowings include €1,720 million (2023: €1,485 million) of bank borrowings that are secured against the Group’s shareholdings in
Indus Towers and Vodafone Idea (see note 12 ‘Investments in Associates and Joint Ventures’ for further details of these assets) and will be repaid
through the realisation of proceeds from those assets. This arrangement contains an embedded derivative option which has been separately fair
valued. The 31 March 2024 valuation of the embedded derivative asset of €22 million (2023: €198 million) is presented within derivative assets in
current assets (see note 14 ‘Trade and other receivables’).
A Black Scholes model for European put options has been used as a valuation model and primarily uses market inputs (quoted share prices and
volatilities for Indus Towers and Vodafone Idea) along with a strike price equal to the amount payable under the loan. The valuation includes an
unobservable adjustment to reflect the potential timeframe to settle the loan and has been modelled using a range of potential durations up to 30
September 2025 (2023: September 2024). As a result of this unobservable adjustment, the option is classified as a level 3 instrument under the fair
value hierarchy. An increase/(decrease) in durations applied of 6 months would increase/(decrease) the derivative asset by €31 million/(€7 million)
(2023: €141million/(€115 million)).
Net financial instruments
The table below shows the Group’s financial assets and liabilities that are subject to offset in the balance sheet and the impact of enforceable
master netting or similar agreements.
At 31 March 2024
Related amounts not set off in the balance sheet
Gross amount
Amount set off
Amounts
presented in
balance sheet
Right of set off
with derivative
counterparties
Collateral
(liabilities)/assets1
Net amount
€m
€m
€m
€m
€m
€m
Derivative financial assets
4,226
–
4,226
(899)
(2,628)
699
Derivative financial liabilities
(1,524)
–
(1,524)
899
741
116
Total
2,702
–
2,702
–
(1,887)
815
At 31 March 2023
Related amounts not set off in the balance sheet
Gross amount
Amount set off
Amounts
presented in
balance sheet
Right of set off
with derivative
counterparties
Collateral
(liabilities)/assets1
Net amount
€m
€m
€m
€m
€m
€m
Derivative financial assets
6,124
–
6,124
(910)
(4,886)
328
Derivative financial liabilities
(1,422)
–
(1,422)
910
239
(273)
Total
4,702
–
4,702
–
(4,647)
55
Note:
1 Excludes non-cash collateral of €370 million (2023: €nil) which is not recognised on balance sheet but which would become payable to the Group in the event of a counterparty default on
the related derivative financial assets.
Financial assets and liabilities are offset and the net amount reported in the consolidated balance sheet when there is a legally enforceable right to
offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Derivative
financial instruments that do not meet the criteria for offset could be settled net in certain circumstances under ISDA (‘International Swaps and
Derivatives Association’) agreements where each party has the option to settle amounts on a net basis in the event of default from the other.
Collateral may be offset and net settled against derivative financial instruments in the event of default by either party. The aforementioned
collateral balances are recorded in notes 13 ‘Other investments’ or 21 ‘Borrowings’ respectively.
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Notes to the consolidated financial statements (continued)
23. Directors and key management compensation
This note details the total amounts earned by the Company’s Directors and members of the Executive Committee.
Directors
Aggregate emoluments of the Directors of the Company were as follows:
2024
2023
2022
€m
€m
€m
Short-term remuneration
8
6
7
Long-term incentive schemes1
1
3
2
9
9
9
Note:
1 Relates to share-based payments.
No Directors serving during the year exercised share options in the year ended 31 March 2024 (2023: None; 2022: None).
Key management compensation
Aggregate compensation for key management, being the Directors and members of the Executive Committee, was as follows:
2024
2023
2022
€m
€m
€m
Short-term employee benefits
27
25
28
Share-based payments
7
12
8
34
37
36
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24. Employees
This note shows the average number of people employed by the Group during the year, in which areas of our business
our employees work and where they are based. It also shows total employment costs.
Re-presented1
Re-presented1
2024
2023
2022
Employees
Employees
Employees
By activity
Operations
15,707
15,808
15,404
Selling and distribution
22,928
24,676
25,499
Customer care and administration
57,647
57,619
56,038
96,282
98,103
96,941
By segment
Germany
15,115
15,242
15,256
UK
9,640
9,312
9,198
Other Europe
11,441
14,189
15,106
Africa
13,578
13,633
13,556
Turkey2
3,126
3,688
3,753
Vantage Towers
–
753
502
Common Functions
34,273
31,561
29,611
87,173
88,378
86,982
Discontinued operations
9,109
9,725
9,959
Total
96,282
98,103
96,941
The cost incurred in respect of these employees (including Directors) was:
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Wages and salaries
4,674
4,384
3,923
Social security costs
497
468
449
Other pension costs (note 25 'Post employment benefits')
217
212
138
Share-based payments (note 26 'Shared-based payments')
110
128
110
5,498
5,192
4,620
Discontinued operations
748
650
714
Total
6,246
5,842
5,334
Notes:
1 The results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 This segment was previously named Other Markets and the comparative period includes the results of Vodafone Ghana which, as previously reported, was sold in February 2023. Other
Markets has been re-named to Turkey because this segment comprised only Vodafone Turkey in the year ended 31 March 2024.
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Notes to the consolidated financial statements (continued)
25. Post employment benefits
The Group operates a number of Defined Benefit and Defined Contribution retirement plans for our employees. The
Group’s largest defined benefit plan is in the UK. For further details see ‘Critical accounting judgements and key sources
of estimation uncertainty’ in note 1 ‘Basis of preparation’.
Accounting policies
For defined benefit retirement plans, the difference between the fair value of the plan assets and the present value of the plan liabilities is
recognised as an asset or a liability on the consolidated statement of financial position. Defined benefit plan liabilities are assessed using the
projected unit funding method and applying the principal actuarial assumptions at the reporting period date. Assets are valued at market value.
Actuarial gains and losses are taken to the consolidated statement of comprehensive income for defined benefit plans or consolidated income
statement for cash leaver plans as incurred. For this purpose, actuarial gains and losses comprise both the effects of changes in actuarial
assumptions and experience adjustments arising from differences between the previous actuarial assumptions and what has actually occurred. The
return on plan assets, in excess of interest income, and costs incurred for the management of plan assets are also taken to other comprehensive
income.
Other movements in the net surplus or deficit are recognised in the consolidated income statement, including the current service cost, any past
service cost and the effect of any settlements. The interest cost less the expected interest income on assets is also charged to the consolidated
income statement. The amount charged to the consolidated income statement in respect of these plans is included within operating costs or in the
Group’s share of the results of equity accounted operations, as appropriate.
The Group’s contributions to defined contribution pension plans are charged to the consolidated income statement as they fall due.
Background
At 31 March 2024 the Group operated a number of retirement plans for the benefit of its employees throughout the world, with varying rights and
obligations depending on the conditions and practices in the countries concerned. The Group’s philosophy is to provide access to defined
contribution retirement plans where feasible and to manage legacy defined benefit retirement arrangements. Defined benefit plans provide
benefits based on the employees’ length of pensionable service and their final pensionable salary or other criteria. Defined contribution plans offer
employees individual funds that are converted into benefits at the time of retirement.
The Group operates defined benefit plans in Germany, India, Ireland, Italy1, the UK, the United States and defined benefit indemnity plans in Greece
and Turkey. Defined contribution plans are currently provided in Egypt, Germany, Greece, India, Ireland, Italy1, Portugal, South Africa, Spain1 and the
UK.
Income statement expense/(income)
Re-presented1
Re-presented1
2024
2023
2022
€m
€m
€m
Defined contribution plans
183
175
167
Defined benefit plans
34
37
(29)
Total amount charged to income statement (note 24)
217
212
138
Note:
1 The defined contribution plan results for the years ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now
reported as discontinued operations, decreasing both the previously disclosed defined contribution plans’ expense and the total amount charged to the income statement by €32 million
and €30 million respectively. The results of the defined benefit plans have not been re-presented as such impacts are immaterial. See note 7 ‘Discontinued operations and assets held for
sale’ for more information.
Defined benefit plans
The Group’s retirement policy is to provide competitive pension provision, in each operating country, in line with the market median for that
location. The Group’s preferred retirement provision is focused on Defined Contribution arrangements and/or State provision for future service.
The Group’s main defined benefit funding liability is the Vodafone UK Group Pension Scheme (‘Vodafone UK plan’). Since June 2014 the Vodafone
UK plan has consisted of two segregated sections: the Vodafone Section and the Cable & Wireless Section (‘CWW Section’). Both sections are closed
to new entrants and to future accrual. The Group also operates smaller funded and unfunded plans in the UK, funded and unfunded plans in
Germany and a funded plan in Ireland. Defined benefit pension provision exposes the Group to actuarial risks such as longer than expected longevity
of participants, lower than expected return on investments and higher than expected inflation, which may increase the liabilities or reduce the value
of assets of the plans.
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The main defined benefit plans are administered by trustee boards which are legally separate from the Group and consist of representatives who are
employees, former employees or are independent from the Group. The trustee boards of the pension plans are required by legislation to act in the
best interest of the participants, set the investment strategy and contribution rates and are subject to statutory funding regimes.
The Vodafone UK plan is registered as an occupational pension plan with HM Revenue and Customs (‘HMRC’) and is subject to UK legislation and
operates within the framework outlined by the Pensions Regulator. UK legislation requires that pension plans are funded prudently and that
valuations are undertaken at least every three years. Separate valuations are required for the Vodafone Section and CWW Section.
The trustees obtain regular actuarial valuations to check whether the statutory funding objective is met and whether a recovery plan is required to
restore funding to the level of the agreed technical provisions. The 31 March 2022 triennial actuarial valuation for the Vodafone Section and CWW
Section of the Vodafone UK plan showed a net surplus of £248 million (€290 million) on the funding basis, comprising of a £97 million (€113
million) surplus for the Vodafone Section and a £151 million (€177 million) surplus for the CWW Section. No further contributions are due in respect
of the Vodafone UK plan at this time. The next actuarial valuation has an effective date of 31 March 2025.
These plan-specific actuarial valuations differ to the IAS 19 ‘Employee Benefits’ accounting basis, which is used to measure pension assets and
liabilities presented in the Group’s consolidated statement of financial position.
Funding plans are individually agreed for each of the Group’s other defined benefit plans with the respective trustees or governing board, taking into
account local regulatory requirements. It is expected that ordinary contributions of €29 million will be paid into the Group’s defined benefit plans
during the year ending 31 March 2025. The Group has also provided certain guarantees in respect of the Vodafone UK plan; further details are
provided in note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements.
The investment strategy for the UK plans is controlled by the trustees in consultation with the Group and the plans have no direct investments in
the Group’s equity securities or in property or other assets currently used by the Group. The allocation of assets between different classes of
investment is reviewed regularly and is a key factor in the trustee investment policy. The trustees aim to achieve the plan’s investment objectives
through investing partly in a diversified mix of growth assets which, over the long term, are expected to grow in value by more than the low-risk
assets. The low-risk assets include cash and gilts, inflation and interest rate hedging and in-substance insured pensioner annuity policies in both the
Vodafone Section and CWW Sections of the Vodafone UK plan and an insured pensioner annuity policy in the Vodafone Ireland Pension Plan. A
number of investment managers are appointed to promote diversification by assets, organisation and investment style and current market
conditions and trends are regularly assessed, which may lead to adjustments in the asset allocation.
The key risks in relation to the Vodafone UK plan are set out below, alongside a summary of the steps taken to mitigate each risk.
Risk description
Mitigation
Investment strategy risk
Underperformance of the investment strategy relative to the
changes in the Vodafone UK Plan's liabilities, which are sensitive to
interest rates and inflation, potentially leading to shortfalls in
meeting pension obligations.
The plan adopts a liability driven investment framework, by investing
in assets that aim to match the characteristics of the Vodafone UK
Plan's liabilities. This can help to hedge the risk of future changes in
interest rate and inflation and also reduce balance sheet volatility.
Longevity risk
Pensions paid by the Vodafone UK Plan are guaranteed for life, and,
therefore, if members are expected to live longer, the liabilities
increase.
The Vodafone UK Plan's funding targets include a margin for
prudence to reflect uncertainty in future life expectancy. Both
sections of the Vodafone UK Plan have pensioner annuity policies
which help reduce exposure to changes in longevity. Longevity risk is
also monitored by the trustees on a regular basis through its risk
management framework.
Regulatory risk
Changes in pension regulations and accounting standards can
impact the Group's pension obligations and reporting requirements.
There is open communication with the trustees and advisors of the
Vodafone UK Plan to understand the impact of any changes in
regulation and to proactively address potential resulting risks.
Actuarial assumptions
The Group’s plan liabilities are measured using the projected unit credit method using the principal actuarial assumptions set out below:
2024
2023
2022
%
%
%
Weighted average actuarial assumptions used at 31 March1
Rate of inflation2
2.9
3.0
3.3
Rate of increase in salaries3
3.0
3.0
3.1
Discount rate
4.5
4.5
2.5
Notes:
1 Figures shown represent a weighted average assumption of the individual plans. The current year weighted averages do not include Vodafone Italy’s defined benefit plan assumptions. See
note 7 ‘Discontinued operations and assets held for sale’ for more information.
2 The rate of increase in pensions in payment and deferred revaluation are dependent on the rate of inflation.
3 Relates only to schemes open to future accrual primarily in Germany, Ireland and India.
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Notes to the consolidated financial statements (continued)
25. Post employment benefits (continued)
Mortality assumptions used are based on recommendations from the individual local actuaries which include adjustments for the experience of the
Group where appropriate. The Group’s largest plan is the Vodafone UK plan. Life expectancies assumed for the UK plans are 22.6/24.3 years (2023:
22.8/24.7 years) for a male/female pensioner currently aged 65 years and 23.6/25.4 years (2023: 23.7/25.5 years) from age 65 for a male/female
non-pensioner member currently aged 40.
Charges made to the consolidated income statement and consolidated statement of comprehensive income (‘SOCI’) on the basis of the
assumptions stated above are shown in the table below.
2024
2023
2022
€m
€m
€m
Current service cost
42
44
38
Net past service credit1
–
–
(71)
Net interest (income)/charge
(8)
(7)
4
Total net cost/(credit) included within staff costs
34
37
(29)
Actuarial losses/(gains) recognised in the SOCI
77
213
(627)
Notes:
1 In the year ended 31 March 2022, a change in Germany relating to the provision of death and disability benefits effective from 1 April 2021 resulted in a past service credit of €49 million and
further net past service credits were recognised for the Vodafone UK plan relating to the offer of a pension increase exchange to all members at retirement and benefit clarifications.
Duration of the benefit obligations
The weighted average duration of the defined benefit obligation at 31 March 2024 is 15 years (2023: 16 years).
Fair value of the assets and present value of the liabilities of the plans
The amount included in the consolidated statement of financial position arising from the Group’s obligations in respect of its defined benefit plans is
as follows:
Assets
Liabilities
Net surplus
€m
€m
€m
1 April 2022
7,715
(7,441)
274
Service cost
–
(44)
(44)
Interest income/(cost)
185
(178)
7
Return on plan assets excluding interest income
(2,475)
–
(2,475)
Actuarial gains arising from changes in demographic assumptions
–
186
186
Actuarial gains arising from changes in financial assumptions
–
2,293
2,293
Actuarial losses arising from experience adjustments
–
(217)
(217)
Employer cash contributions
42
–
42
Member cash contributions
15
(15)
–
Benefits paid
(216)
216
–
Exchange rate movements
(211)
224
13
Other movements
(8)
–
(8)
31 March 2023
5,047
(4,976)
71
Service cost
–
(42)
(42)
Interest income/(cost)
223
(215)
8
Return on plan assets excluding interest income
(102)
–
(102)
Actuarial gains arising from changes in demographic assumptions
–
72
72
Actuarial gains arising from changes in financial assumptions
–
30
30
Actuarial losses arising from experience adjustments
–
(77)
(77)
Employer cash contributions
41
–
41
Member cash contributions
15
(15)
–
Benefits paid
(173)
173
–
Exchange rate movements
104
(73)
31
Liabilities held for sale
–
51
51
Other movements
(7)
–
(7)
31 March 2024
5,148
(5,072)
76
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The table below provides an analysis of the net surplus for the Group as a whole.
2024
2023
€m
€m
Analysis of net surplus:
Total fair value of plan assets
5,148
5,047
Present value of funded plan liabilities
(5,017)
(4,875)
Net surplus for funded plans
131
172
Present value of unfunded plan liabilities
(55)
(101)
Net surplus
76
71
Net surplus is analysed as:
Assets1
257
329
Liabilities
(181)
(258)
Note:
1 Pension assets are deemed to be recoverable and there are no adjustments in respect of minimum funding requirements as economic benefits are available to the Group either in the form of
future refunds or, for plans still open to benefit accrual, in the form of possible reductions in future contributions.
An analysis of net surplus is provided below for the Vodafone UK plan, which is a funded plan. As part of the merger of the Vodafone UK plan and the
Cable and Wireless Worldwide Retirement Plan (‘CWWRP’) plan on 6 June 2014 the assets and liabilities of the CWW Section are segregated from the
Vodafone Section and hence are reported separately below.
CWW Section
Vodafone Section
2024
2023
2024
2023
€m
€m
€m
€m
Analysis of net surplus:
Total fair value of plan assets
1,781
1,845
1,983
1,958
Present value of plan liabilities
(1,676)
(1,657)
(1,924)
(1,900)
Net surplus1
105
188
59
58
Note:
1 All net surpluses are reported as non-current assets in the consolidated statement of financial position.
Fair value of plan assets
2024
2023
€m
€m
Cash and cash equivalents
52
27
Equity investments:
With quoted prices in an active market
261
140
Without quoted prices in an active market
293
322
Debt instruments:
With quoted prices in an active market
928
588
Without quoted prices in an active market
944
288
Property:
With quoted prices in an active market
16
17
Without quoted prices in an active market
374
438
Derivatives:1
Without quoted prices in an active market
1,040
1,791
Investment fund
580
782
Annuity policies
With quoted prices in an active market
–
25
Without quoted prices
660
629
Total
5,148
5,047
Note:
1 Derivatives include collateral held in the form of cash. Assets are valued using ‘level 2’ inputs under IFRS 13 ‘Fair Value Measurement’ principles and classified as unquoted accordingly.
The fair value of plan assets, which have been measured in accordance with IFRS 13 ‘Fair Value Measurement’, are analysed by asset category above
and are subdivided by assets that have a quoted market price in an active market and those that do not, such as investment funds. Where available,
the fair values are quoted prices (e.g. listed equity, sovereign debt and corporate bonds). Unlisted investments without quoted prices in an active
market (e.g. private equity) are included at values provided by the fund manager in accordance with relevant guidance. Other significant assets are
valued based on observable inputs such as yield curves. The Vodafone UK plan annuity policies fully match the pension obligations of those
pensioners insured and therefore are set equal to the present value of the related obligations. Investment funds of €580 million at 31 March 2024
(2023: €782 million) include investments in diversified alternative beta funds held in the Vodafone Section of the Vodafone UK plan.
The actual return on plan assets over the year to 31 March 2024 was a gain of €121 million (2023: €2,290 million loss).
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Notes to the consolidated financial statements (continued)
Sensitivity analysis
Measurement of the Group’s defined benefit retirement obligation is sensitive to changes in certain key assumptions. The sensitivity analysis below
shows how a reasonably possible increase or decrease in a particular assumption would, in isolation, result in an increase or decrease in the present
value of the defined benefit obligation as at 31 March 2024.
Rate of inflation
Rate of increase in salaries
Discount rate
Life expectancy
Decrease
by 0.5%
Increase
by 0.5%
Decrease
by 0.5%
Increase
by 0.5%
Decrease
by 0.5%
Increase
by 0.5%
Decrease
by 1 year
Increase
by 1 year
€m
€m
€m
€m
€m
€m
€m
€m
(Decrease)/increase in present
(232)
250
(2)
3
362
(321)
(122)
122
value of defined benefit obligation1
Note:
1 The sensitivity analysis may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions would occur in isolation of one another. In
presenting this sensitivity analysis, the change in the present value of the defined benefit obligation has been calculated on the same basis as prior years using the projected unit credit
method at the end of the year, which is the same as that applied in calculating the defined benefit obligation liability recognised in the statement of financial position. The rate of inflation
assumption sensitivity factors in the impact of changes to all assumptions relating to inflation including the rate of increase in salaries, pension increases and deferred revaluations.
26. Share-based payments
The Group has a number of share plans used to award shares to Executive Directors and employees as part of their
remuneration package. A charge is recognised over the vesting period in the consolidated income statement to record
the cost of these, based on the fair value of the award on the grant date.
Accounting policies
The Group issues equity-settled share-based awards to certain employees. Equity-settled share-based awards are measured at fair value (excluding
the effect of non-market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-
based award is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of the shares that will eventually vest and
adjusted for the effect of non-market-based vesting conditions. A corresponding increase in additional paid-in capital is also recognised.
Some share awards have an attached market condition, based on total shareholder return (‘TSR’), which is taken into account when calculating
the fair value of the share awards. The valuation for the TSR is based on Vodafone’s ranking within the same group of companies, where possible,
over the past five years.
The fair value of awards of non-vested shares is a calculation of the closing price of the Company’s shares on the day prior to the grant date, adjusted
for the present value of the delay in receiving dividends where appropriate.
The maximum aggregate number of ordinary shares which may be issued in respect of share options or share plans will not (without shareholder
approval) exceed:
− 10% of the ordinary share capital of the Company in issue immediately prior to the date of grant, when aggregated with the total number of
ordinary shares which have been allocated in the preceding ten year period under all plans; and
− 5% of the ordinary share capital of the Company in issue immediately prior to the date of grant, when aggregated with the total number of
ordinary shares which have been allocated in the preceding ten year period under all plans, other than any plans which are operated
on an all-employee basis.
Share options
Vodafone Sharesave Plan
Under the Vodafone Sharesave Plan UK staff may acquire shares in the Company through monthly savings of up to £375 over a three and/or five
year period. The savings may then be used to purchase shares at the option price, which is set at the beginning of the invitation period at a discount
of up to 20% to the then prevailing market price of the Company’s shares.
Share plans
Vodafone Group executive plans
Under the Vodafone Global Incentive Plan awards of shares are granted to Directors and certain employees. The release of these shares is
conditional upon continued employment and for some awards achievement of certain performance targets measured over a three year period.
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Movements in outstanding ordinary share options
Ordinary share options
2024
2023
2022
Millions
Millions
Millions
1 April
62
61
62
Granted during the year
63
50
20
Forfeited during the year
(1)
(2)
(2)
Exercised during the year
–
(8)
(1)
Expired during the year
(54)
(39)
(18)
31 March
70
62
61
Weighted average exercise price:
1 April
£0.87
£1.02
£1.07
Granted during the year
£0.58
£0.83
£0.95
Forfeited during the year
£0.81
£1.02
£1.06
Exercised during the year
£1.06
£1.05
£1.17
Expired during the year
£0.82
£1.01
£1.10
31 March
£0.66
£0.87
£1.02
Summary of options outstanding
31 March 2024
31 March 2023
Outstanding
shares
Weighted
average
exercise
Weighted
remaining
average
contractual
life
Outstanding
shares
Weighted
average
exercise
Weighted
remaining
average
contractual
life
Millions
price
Months
Millions
price
Months
Vodafone Group Sharesave Plan:
£0.58 - £1.57
70
£0.66
31
62
£0.87
33
Share awards
Movements in non-vested shares are as follows:
2024
2023
2022
Weighted
Weighted
Weighted
average fair
average fair
average fair
value at
value at
value at
Millions
grant date
Millions
grant date
Millions
grant date
1 April
261
£1.14
270
£1.07
267
£1.20
Granted
177
£0.72
120
£1.17
113
£1.17
Vested
(76)
£1.17
(70)
£1.15
(68)
£1.44
Forfeited
(45)
£0.99
(59)
£0.89
(42)
£1.52
31 March
317
£0.92
261
£1.14
270
£1.07
Other information
The total fair value of shares vested during the year ended 31 March 2024 was £89 million (2023: £81 million; 2022: £98 million).
The compensation cost included in the consolidated income statement in respect of share options and share plans was €125 million (2023: €141
million; 2022: €119 million) which is comprised principally of equity-settled transactions.
The average share price for the year ended 31 March 2024 was 74.7 pence (2023: 108.2 pence; 2022: 122.1 pence).
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Notes to the consolidated financial statements (continued)
27. Acquisitions and disposals
The note below provides details of acquisition and disposal transactions for the current year as well as those completed in the
prior year. For further details see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of
preparation’ to the consolidated financial statements.
Accounting policies
Business combinations
Acquisitions of subsidiaries are accounted for using the acquisition method. The cost of the acquisition is measured at the aggregate of the fair values at
the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued by the Group. Acquisition-related costs are recognised
in the consolidated income statement as incurred. The acquiree’s identifiable assets and liabilities are recognised at their fair values at the acquisition
date, which is the date on which control is transferred to the Group. Goodwill is measured as the excess of the sum of the consideration transferred, the
amount of any non-controlling interests in the acquiree and the fair value of the Group’s previously held equity interest in the acquiree, if any, over the
net amounts of identifiable assets acquired and liabilities assumed at the acquisition date. The interest of the non-controlling shareholders in the
acquiree may initially be measured either at fair value or at the non-controlling shareholders’ proportion of the net fair value of the identifiable assets
acquired, liabilities and contingent liabilities assumed. The choice of measurement basis is made on an acquisition-by-acquisition basis.
Acquisition of interests from non-controlling shareholders
In transactions with non-controlling parties that do not result in a change in control, the difference between the fair value of the consideration paid or
received and the amount by which the non-controlling interest is adjusted is recognised in equity.
Disposals
The difference between the carrying value of the net assets disposed of and the fair value of consideration received is recorded as a gain or loss on
disposal. Foreign exchange translation gains or losses relating to subsidiaries, joint arrangements and associates that the Group has disposed of, and that
have previously been recorded in other comprehensive income or expense, are also recognised as part of the gain or loss on disposal.
Other transactions with non-controlling shareholders in subsidiaries
The aggregate cash consideration in respect of other transactions with non-controlling shareholders in subsidiaries, net of cash acquired, is as follows:
2024
2023
€m
€m
Cash consideration (paid)
Vantage Towers
–
(667)
Other
(16)
(25)
(16)
(692)
Vantage Towers
In the comparative period on 13 November 2022, the Group completed the purchase of 4.2% of Vantage Towers A.G. for cash consideration of €667
million which took its shareholding to 85.8%.
Disposals
The aggregate cash consideration in respect of the disposal of subsidiaries, net of cash disposed, is as follows:
2024
2023
€m
€m
Cash consideration (paid)/received
Vodafone Hungary
(4)
1,606
Vantage Towers
–
5,592
Other disposals during the period
–
2
Net cash disposed
(63)
(224)
(67)
6,976
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M-Pesa Holdings
On 28 September 2023 the Group sold M-Pesa Holding Company Limited (‘MPHCL’), which holds funds on trust for M-Pesa customers, to Safaricom Plc
for US$1. Balances included in the Group’s consolidated statement of financial position at the date of disposal included cash of €63 million, together
with short-term investments of €1,195 million and €1,156 million due to M-Pesa customers recorded within Other investments and Trade and other
payables, respectively.
Vodafone Hungary
In the comparative period on 31 January 2023, the Group completed the sale of Vodafone Magyarország Zrt (‘Vodafone Hungary’) to 4iG Public Limited
Company and Corvinus Zrt. The table below summarises the net assets disposed and the resulting loss on disposal of €69 million.
€m
Goodwill
(441)
Other intangible assets
(521)
Property, plant and equipment
(516)
Inventory
(17)
Trade and other receivables
(206)
Cash and cash equivalents
(3)
Current and deferred taxation
13
Borrowings
106
Trade and other payables
163
Provisions
31
Net assets disposed
(1,391)
Cash proceeds
1,606
Foreign exchange recycled from Currency reserve on disposal
(284)
Net loss on disposal1
(69)
Notes:
1 Included in other income in the consolidated income statement in the year ended 31 March 2023.
Vantage Towers
In the comparative period on 22 March 2023, the Group completed the disposal of its interest in Vantage Towers A.G. to Oak Holdings 1 GmbH, the co-
control partnership of Vodafone, GIP and KKR. Vodafone initially retained an interest of 64.2% in Oak Holdings 1 GmbH, which owns 89.3% of Vantage
Towers A.G. The table below summarises the net assets disposed and the net gain on disposal as €8,607 million.
€m
Goodwill
(3,448)
Other intangible assets
(294)
Property, plant and equipment
(4,882)
Investments in associates and joint ventures
(2,778)
Trade and other receivables
(292)
Cash and cash equivalants
(207)
Current and deferred taxation
61
Borrowings
4,916
Trade and other payables
658
Provisions
556
Net assets disposed
(5,710)
Non-controlling interests derecognised
807
Cash proceeds
5,592
Fair value of Investment in Oak Holdings 1 GmbH
8,634
Restriction of gain (note 20)1
(680)
Foreign exchange recycled from Currency reserve on disposal
(36)
Net gain on disposal2
8,607
Notes:
1 Related tax of €154 million is included in Income tax expense in the consolidated income statement in the year ended 31 March 2023.
2 €8,729 million included in other income and €122 million included in discontinued operations in the consolidated income statement in the year ended 31 March 2023 .
Vodafone Ghana
In the comparative period on 21 February 2023, the Group completed the sale of its 70% shareholding in Vodafone Telecommunications Company
Limited (‘Vodafone Ghana’) to Telecel Group for consideration of €Nil. A net gain on disposal of €689 million was recorded within other income and
expense in the consolidated income statement.
Other matters
Vodafone Egypt
In the comparative period on 13 December 2022, the Group announced it had completed the transfer of its 55% shareholding in Vodafone Egypt to its
subsidiary, Vodacom Group Limited (‘Vodacom’). Vodafone was issued with 242 million shares in Vodacom and received cash proceeds of €577 million
in exchange for its 55% shareholding in Vodafone Egypt. Following completion, Vodafone’s shareholding in Vodacom has increased from 60.5% to
65.1%.
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Notes to the consolidated financial statements (continued)
28. Commitments
A commitment is a contractual obligation to make a payment in the future, mainly in relation to agreements to buy assets such
as mobile devices, network infrastructure and IT systems and leases that have not commenced. These amounts are not
recorded in the consolidated statement of financial position since we have not yet received the goods or services from the
supplier.
Capital commitments
The amounts below are the minimum amounts that we are committed to pay.
Group
2024
2023
€m
€m
Contracts placed for future capital expenditure not provided in the financial statements1, 2
2,442
3,507
Note:
1 Commitment includes contracts placed for property, plant and equipment and intangible assets.
2 Includes €423 million (2023: €469 million) in respect of Vodafone Italy and Vodafone Spain, which are now reported as discontinued operations. See note 7 ‘Discontinued operations and assets held
for sale’ for more information.
Leases entered into by the Group but not commenced at 31 March 2024 are disclosed in note 20 ‘Leases’. Included in capital commitments is an
amount of €nil (2023: €114 million) relating to spectrum acquisition commitments in Vodacom.
In March 2023, the Group entered into an agreement with Altice Luxembourg S.A. to create a joint venture, OXG Glasfaser Beteiligungs GmbH
(‘OXG’), with 50.0% shareholding held by each shareholder. Each shareholder is committed to contribute funding of up to €950 million to OXG for
the deployment of fibre-to-the-home in Germany. During the year ended 31 March 2024, the Group provided €32 million of capital contributions to
OXG. The remaining funding commitment of €918 million is expected to be contributed between 2024 and 2029. The amount and timing of the
funding depends on the speed and size of the fibre deployment. The contribution can be in the form of free capital reserves, shareholder loan, loan
notes or similar instruments as agreed by the shareholders.
29. Contingent liabilities and legal proceedings
Contingent liabilities are potential future cash outflows, where the likelihood of payment is considered more than remote, but
is not considered probable or cannot be measured reliably.
2024
2023
€m
€m
Performance and payment bonds1
1,399
1,307
Notes:
1 Performance bonds require the Group to make payments to third parties in the event that the Group does not perform what is expected of it under the terms of any related contracts or commercial
arrangements.
UK pension schemes
The Group’s main defined benefit plan is the Vodafone UK Group Pension Scheme (‘Vodafone UK plan’) which has two segregated sections, the
Vodafone Section and the CWW Section, as detailed in note 25 ‘Post employment benefits’.
The Group has covenanted to provide security in favour of both the Vodafone Section and CWW Section when they are in a deficit position. The deficit is
measured on a prescribed basis agreed between the Group and Trustee, which differs from the IAS 19 accounting basis or the funding basis per the
triennial actuarial valuation reported in note 25 ‘Post employment benefits’. The Group provides surety bonds as the security.
The level of the security has varied since inception in line with the movement in the Vodafone UK plan deficit. As at 31 March 2024 the Vodafone UK
plan retains security over €117 million (notional value) for the Vodafone Section and no security is currently required for the CWW Section. The security
may be substituted either on a voluntary or mandatory basis. The Company has also provided two guarantees to the Vodafone Section of the Vodafone
UK plan for a combined value up to €1.46 billion to provide security over the deficit under certain defined circumstances, including insolvency of the
employers. The Company has also agreed a similar guarantee of up to €1.46 billion for the CWW Section.
An additional smaller UK defined benefit plan, the THUS Plc Group Scheme, has a guarantee from the Company for up to €117 million.
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Vodafone Idea
As part of the agreement to merge Vodafone India and Idea Cellular in 2017, the parties agreed a mechanism for payments between the Group and
Vodafone Idea Limited (‘VIL’) pursuant to the difference between the crystallisation of certain identified contingent liabilities in relation to legal,
regulatory, tax and other matters, and refunds relating to Vodafone India and Idea Cellular. Cash payments or cash receipts relating to these matters
must have been made or received by VIL before any amount becomes due from or owed to the Group. Any future payments by the Group to VIL as a
result of this agreement would only be made after satisfaction of this and other contractual conditions. The Group’s maximum potential exposure
under this mechanism is capped at INR 64 billion (€713 million).
The final liability calculation date under the CLAM is 30 June 2025 and no further cash payments are considered probable from the Group as at 31 March
2024.
The carrying value of the Group’s investment in VIL is €nil and the Group is recording no further share of losses in respect of VIL. The Group’s potential
exposure to liabilities within VIL is capped by the mechanism described above; consequently, contingent liabilities arising from litigation in India
concerning the operations of Vodafone India are not reported.
Indus Towers
Under the terms of the Indus and Bharti Infratel merger in November 2020, a security package was agreed for the benefit of the newly created merged
entity, Indus Towers, which could be invoked in the event that VIL was unable to make MSA payments. The remaining element of the security package is
a secondary pledge over shares owned by Vodafone Group in Indus Towers, ranking behind Vodafone’s existing lenders for the outstanding bank
borrowings of €1.7 billion as at 31 March 2024 secured against Indian assets (‘the bank borrowings’), with a maximum liability cap of INR 42.5 billion
(€472 million). In the event of non-payment of relevant MSA obligations by VIL, Indus Towers would have recourse to any secondary pledged shares,
after repayment of the bank borrowings in full, up to the value of the liability cap.
Legal Proceedings
The Group is currently involved in a number of legal proceedings, including inquiries from, or discussions with, government authorities that are
incidental to its operations.
Legal proceedings where the Group considers that the likelihood of material future outflows of cash or other resources is more than remote are
disclosed below. Where the Group assesses that it is probable that the outcome of legal proceedings will result in a financial outflow, and a reliable
estimate can be made of the amount of that obligation, a provision is recognised for these amounts.
In all cases, determining the probability of successfully defending a claim against the Group involves the application of judgement as the outcome
is inherently uncertain. The determination of the value of any future outflows of cash or other resources, and the timing of such outflows, involves
the use of estimates. The costs incurred in complex legal proceedings, regardless of outcome, can be significant.
The Group is not involved in any material proceedings in which any of the Group’s Directors, members of senior management or affiliates are either a
party adverse to the Group or have a material interest adverse to the Group.
Tax cases
VISPL tax claims
Vodafone India Services Private Limited (‘VISPL’) is involved in a number of tax cases. The total value of the claims is approximately €468 million plus
interest, and penalties of up to 300% of the principal.
Of the individual tax claims, the most significant is for approximately €238 million (plus interest of €672 million), which VISPL has been assessed as
owing in respect of: (i) the sale of an international call centre by VISPL to Hutchison Telecommunications International Limited group (‘HTIL’); and
(ii) the acquisition of and/or the alleged transfer of options held by VISPL in Vodafone India Limited. Item (i) is subject to an indemnity by HTIL. Item
(ii), which forms the largest part of the potential claim, is not subject to any indemnity. A stay of the tax demand was obtained following a deposit of
INR 2,000 million (€22 million) being paid, and a corporate guarantee being provided by Vodafone International Holdings BV (‘VIHBV’) for the
balance of tax assessed. On 8 October 2015, the Bombay High Court ruled in favour of Vodafone in relation to the options and the call centre sale.
The Indian Tax Authority has appealed to the Supreme Court of India. The appeal hearing has been adjourned indefinitely. A claim in respect of the
transfer pricing margin charged for the international call centre of HTIL prior to the 2007 transaction with Vodafone for HTIL assets in India has now
been settled.
While there is some uncertainty as to the outcome of the remaining tax cases involving VISPL, the Group believes it has valid defences and does not
consider it probable that a financial outflow will be required to settle these cases.
Netherlands tax case
Vodafone Europe BV (‘VEBV’) received assessments totalling €267 million of tax and interest from the Dutch tax authorities, who challenged the
application of the arm’s length principle in relation to various intra-group financing transactions. The Group entered into a guarantee for the full
value of the assessments issued. VEBV appealed against these assessments to the District Court of the Hague where a hearing was held in March
2023. The District Court issued its judgement in July 2023, upholding VEBV’s appeal in relation to the majority of issues and requiring the Dutch tax
authorities to significantly reduce its assessments. VEBV and the Dutch tax authorities have since appealed the judgement. The appeal hearing date
is not yet known but is expected to be before the end of 2024.
The Group continues to believe it has robust defences but has recorded a provision of €24 million for tax and interest, reflecting the Group’s current
view of the probable financial outflow required to fully resolve the issue and has reduced the guarantee to the same value.
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Notes to the consolidated financial statements (continued)
29. Contingent liabilities and legal proceedings (continued)
Other cases in the Group
Germany: Kabel Deutschland takeover - class actions
The German courts have been determining the adequacy of the mandatory cash offer made to minority shareholders in Vodafone’s takeover of
Kabel Deutschland in 2013. Hearings took place in May 2019 and a decision was delivered in November 2019 in Vodafone’s favour, rejecting all
claims by minority shareholders. A number of shareholders appealed which was rejected by the court in December 2021. Several minority
shareholders filed a further appeal before the Federal Court of Justice which was dismissed in April 2024.
Germany: price increase class action
In November 2023, the Verbraucherzentrale Bundesverband (Federation of German Consumer Organisations) initiated a class action against
Vodafone Germany in the Hamm Higher Regional Court. Vodafone Germany implemented price increases of €5 per month for fixed lines services in
2023 in response to higher costs. The claim alleges that terms regarding price increases in the consumer contracts entered into by Vodafone
Germany’s customers up until August 2023 are invalid under German civil law and seeks reimbursement of the additional charges plus interest.
Customers must enter their details onto the register of collective actions on the Federal Office of Justice website in order to participate in the claim.
The register opened on 23 April 2024.
Whilst the Group intends to defend the claim, it is not able to determine the likelihood or estimate the amount of any possible financial loss at this
early stage of the proceedings.
Germany: claims regarding transfer of data to credit agencies
Individual consumers are bringing claims against Vodafone Germany and/or the other national network operators alleging that information was
passed to credit agencies up to February 2024 about contracts for mobile services without consumer consent. The claims seek damages of up to
€5,000 per contract for GDPR (General Data Protection Regulation) infringement. As at 31 March 2024, Vodafone Germany had been notified of 316
claims filed in various regional courts. The other national network operators are facing similar claims.
The Group’s position is that the transfer of data about the existence of a consumer contract (and not about payments in relation to the contract) to
credit agencies is standard practice and justified for the purposes of fraud prevention. However, given the increasing volume of claims, Vodafone
Germany has stopped this activity.
Although the outcome of these claims is uncertain and consequently it is not possible to estimate a potential financial loss, if any, at this stage, the
Group believes it has valid defences and that no present obligation exists based on all available evidence.
Germany: investigation by federal data protection authority
In 2021, the BfDI (Federal Commissioner for Data Protection and Freedom of Information) started an investigation into potential breaches of the
GDPR in relation to the systems used by Vodafone Germany’s sales partners to manage customer data.
Vodafone Germany is working cooperatively with the authority to discuss the circumstances giving rise to these issues and is currently conducting
settlement talks with the aim of reaching a constructive resolution of the proceedings. Under the GDPR the authority has the power to impose fines
of up to 2% of the Group’s annual revenue from the preceding financial year.
A provision immaterial to the financial statements has been recorded.
Italy: Iliad v Vodafone Italy
In July 2019, Iliad filed a claim for €500 million against Vodafone Italy in the Civil Court of Milan. The claim alleges anti-competitive behaviour in
relation to customer portability and certain advertising campaigns by Vodafone Italy. The main hearing on the merits of the claim took place on 8
June 2021. On 17 April 2023, the Civil Court issued a judgement in Vodafone Italy's favour and rejected Iliad's claim for damages in full. Iliad filed an
appeal before the Court of Appeal of Milan in June 2023. The appeal process is ongoing.
The Group is currently unable to estimate any possible loss in this claim in the event of an adverse judgement on appeal but, while the outcome is
uncertain, the Group believes it has valid defences and that it is probable that no present obligation exists.
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Greece: Papistas Holdings SA, Mobile Trade Stores (formerly Papistas SA) and Athanasios and Loukia Papistas v Vodafone Greece
In October 2019, Mr. and Mrs. Papistas, and companies owned or controlled by them, filed several claims against Vodafone Greece with a total value
of approximately €330 million for purported damage caused by the alleged abuse of dominance and wrongful termination of a franchise
arrangement with a Papistas company. Lawsuits which the Papistas claimants had previously brought against Vodafone Greece, including one also
citing Vodafone Group Plc and certain Directors and officers of Vodafone as defendants, were either withdrawn or left dormant. Vodafone Greece
filed a counter claim and all claims were heard in February 2020. All of the Papistas claims were rejected by the Athens Court of First Instance
because the stamp duty payments required to have the merits of the case considered had not been made. Vodafone Greece’s counter claim was
also rejected. The Papistas claimants and Vodafone Greece each filed appeals. The appeal hearings took place on 23 February and 11 May 2023.
Judgement has been received and the Court dismissed both of the appeals because the stamp duty payments had again not been made, except for
one aspect of the proceedings which will be dealt with at a further hearing in February 2025. Whether the Papistas claimants will appeal the
judgement is unknown as at the date of this report.
Vodafone is continuing vigorously to defend the claims and based on the progress of the litigation so far the Group believes that it is highly unlikely
that there will be an adverse ruling for the Group. On this basis, the Group does not expect the outcome of these claims to have a material financial
impact.
UK: Phones 4U in Administration v Vodafone Limited, Vodafone Group Plc and Others
In December 2018, the administrators of former UK indirect seller, Phones 4U, sued the three main UK mobile network operators (‘MNOs’),
including Vodafone, and their parent companies in the English High Court. The administrators alleged collusion between the MNOs to withdraw
their business from Phones 4U thereby causing its collapse. The judge ordered that there should be a split trial between liability and damages. The
first trial on liability took place from May to July 2022. On 10 November 2023, the High Court issued a judgement in Vodafone’s favour and rejected
Phones 4U’s allegations that the defendants were in breach of competition law, consistent with Vodafone’s previously stated position that a present
obligation does not exist. Phones 4U has been granted permission to appeal the judgement from the Court of Appeal. The appeal hearing will take
place in May 2025.
The Group intends to vigorously defend the appeal and is not able to estimate any possible loss in the event of an adverse judgement on appeal.
South Africa: Kenneth Makate v Vodacom (Pty) Limited
Mr Kenneth Makate, a former employee of Vodacom Pty Limited (‘Vodacom South Africa’), started legal proceedings in 2008 claiming
compensation for a business idea that led to the development of a service known as ‘Please Call Me’ (‘PCM’). In July 2014, the Gauteng High Court
(‘the High Court’) ruled that Mr Makate had proven the existence of a contract, but that Vodacom South Africa was not bound by that contract
because the responsible director did not have authority to enter into such an agreement on Vodacom South Africa’s behalf. The High Court and
Supreme Court of Appeal (‘the SCA’) turned down Mr Makate’s application for leave to appeal in December 2014 and March 2015, respectively.
In April 2016, the Constitutional Court of South Africa (‘the Constitutional Court’) granted leave to appeal and upheld Mr Makate’s appeal. It found
that Vodacom South Africa is bound by an agreement and ordered the parties to negotiate, in good faith, and agree a reasonable compensation
amount payable to Mr Makate or, in the event of a deadlock, for the matter to be referred to Vodacom Group’s Chief Executive Officer (‘the CEO’) for
determination. Mr Makate’s application for the aforementioned order to be varied from the determination of an amount to a compensation model
based on a share of revenue, was dismissed by the Constitutional Court. In accordance with the Constitutional Court order, and after negotiations
failed, the CEO issued his determination on 9 January 2019. However, the CEO’s award of R47 million (€2 million) was rejected by Mr Makate, who
subsequently brought an application in the High Court for judicial review against the CEO’s determination and award.
The High Court, in a judgement delivered on 8 February 2022, set aside the CEO’s determination and ordered him to reassess the amount
employing a set of criteria which would have resulted in the payment of a higher compensation amount, for the benefit of Mr Makate, than that
determined by the CEO. Vodacom South Africa appealed against the judgement and the order of the High Court to the SCA. The SCA heard the
appeal on 9 May 2023 and its judgement was handed down on 6 February 2024. A majority of three judges, with a minority of two judges dissenting,
dismissed the appeal and ruled that Mr Makate is entitled to be paid 5% - 7.5% of the total revenue of the PCM product from March 2001 to the date
of the judgement, plus interest.
On 27 February 2024, Vodacom South Africa applied for leave to appeal the judgement and order of the SCA to the Constitutional Court, resulting in
the suspension of the operation of the judgement and order of the SCA. Mr Makate is opposing Vodacom South Africa’s application for leave to
appeal. Vodacom South Africa is challenging the SCA’s judgement and order on various grounds including, but not limited to the SCA ignoring the
evidence placed before it on the computation of the quantum of compensation payable to Mr Makate, and the SCA issuing orders that are legally
unenforceable.
The CEO’s determination in 2019 amounted to R47 million (€2 million). The minority judgement of the SCA raised Mr Makate’s compensation to
approximately R186 million (€9 million), while the SCA majority judgement would entitle Mr Makate to a minimum compensation amount of R29
billion (€1.4 billion). Consequently, the range of the possible compensation outcomes in this matter is very wide.
The amount ultimately payable to Mr Makate is uncertain and will depend on the determination of the Constitutional Court to grant Vodacom
South Africa’s application for leave to appeal and, if granted, on the success of Vodacom South Africa’s appeal against the judgement and order of
the SCA, on the merits of the case. The Group is continuing to challenge the level of compensation payable to Mr Makate and a provision immaterial
to the financial statements has been recorded.
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Other information
Notes to the consolidated financial statements (continued)
29. Contingent liabilities and legal proceedings (continued)
UK: Mr Justin Gutmann v Vodafone Limited and Vodafone Group Plc
In November 2023, Mr Gutmann issued claims in the Competition Appeal Tribunal seeking permission, as a proposed class representative, to bring
collective proceedings against the four UK MNOs and their respective parent companies. Vodafone Group Plc and Vodafone Limited are named
defendants to one of the claims with an alleged value of £1.4 billion (approximately €1.6 billion), including interest. It is alleged that Vodafone and
the other MNOs used their alleged market dominance to overcharge customers after the expiry of the minimum terms of certain mobile contracts
(referred to as a ‘loyalty penalty’).
Taking into account all available evidence at this stage, the Group’s assessment is that the allegations are without merit and it intends to defend the
claim. The Group is currently unable to estimate any possible loss in regards to this issue but, while the outcome is uncertain, the Group believes it is
probable that no present obligation exists.
30. Related party transactions
The Group has a number of related parties including joint arrangements and associates, pension schemes and Directors and
Executive Committee members (see note 12 ‘Investments in associates and joint arrangements’, note 25 ‘Post employment
benefits’ and note 23 ‘Directors and key management compensation’).
Transactions with joint arrangements and associates
Related party transactions with the Group’s joint arrangements and associates primarily comprise fees for the use of products and services including
network airtime and access charges, fees for the provision of network infrastructure and cash pooling arrangements. No related party transactions have
been entered into during the year which might reasonably affect any decisions made by the users of these consolidated financial statements except as
disclosed below.
2024
2023
2022
€m
€m
€m
Sales of goods and services to associates
25
20
20
Purchase of goods and services from associates
6
8
10
Sales of goods and services to joint arrangements
267
220
221
Purchase of goods and services from joint arrangements
932
263
298
Interest income receivable from joint arrangements1
52
52
48
Interest expense payable to joint arrangements1
239
33
52
Trade balances owed:
by associates
19
7
to associates
1
1
by joint arrangements
190
170
to joint arrangements
379
329
Other balances owed by joint arrangements1
1,105
980
Other balances owed to joint arrangements2
4,940
5,628
Notes:
1 Amounts arise primarily through VodafoneZiggo and Oak Holdings 1 GmbH. Interest is paid/received in line with market rates.
2 Amounts are primarily in relation to leases of tower space from Oak Holdings 1 GmbH.
Dividends received from associates and joint ventures are disclosed in the consolidated statement of cash flows.
Transactions with Directors other than compensation
During the three years ended 31 March 2024 and as of 14 May 2024, no Director nor any other executive officer, nor any associate of any Director or any
other executive officer, was indebted to the Group. During the three years ended 31 March 2024 and as of 14 May 2024, the Group has not been a party
to any other material transaction, or proposed transactions, in which any member of the key management personnel (including Directors, any other
executive officer, senior manager, any spouse or relative of any of the foregoing or any relative of such spouse) had or was to have a direct or indirect
material interest.
Company name
% of share
class held
by Group
Companies
Share Class
Albania
Autostrada Tirane-Durres, Rruga: “Pavaresia”, Nr 61, Kashar,
Tirana,Albania
Vodafone Albania Sh.A
100.00
Ordinary shares
Rruga “Ibrahim Rugova”, Sky Tower, Kati i 5, Hyrja 2, Tiranë,
1000, Albania
_VOIS Albania Shpk.
100.00
Ordinary shares
Australia
Mills Oakley, Level 7, 151 Clarence Street, Sydney NSW 2000,
Australia
Vodafone Enterprise Australia Pty
Limited
100.00
Ordinary shares
Austria
c/vo EvVodaersheds Sutherland Rechtsanwälte GmbH, Kärntner
Ring 12, 3. Stock, 1010, Wien, Austria
Vodafone Enterprise Austria GmbH
100.00
Quotas shares
Bahrain
RSM Bahrain, 3rd floor Falcon Tower, Diplomatic Area, Manama,
PO BOX 11816, Bahrain
Vodafone Enterprise Bahrain W.L.L.
100.00
Ordinary shares
Belgium
Malta House, rue Archimède 25, 1000 Bruxelles, Belgium
Vodafone Belgium SA/NV
100.00
Ordinary shares
Brazil
Av. Paulista, 37 – 4º andar, Sala 427, Bela Vista, CEP, 01311-902,
São Paulo, Brazil
Vodafone Empresa Brasil
Telecomunicações Ltda
100.00
Ordinary shares
Rua Boa Vista, No. 254, room 1304 (parte), Centro, São Paulo,
01014907, Brazil
Vodafone Serviços Empresariais
Brasil Ltda.
100.00
Ordinary shares
Company name
% of share
class held
by Group
Companies
Share Class
Bulgaria
10 Tsar Osvoboditel Blvd., 3rd Floor, Spredets Region, Sofia,
1000, Bulgaria
Vodafone Enterprise Bulgaria EOOD
100.00
Ordinary shares
Canada
c/o ARC Information Services Inc., 3-84 Castlebury Crescent,
Toronto ON M2H 1W8, Canada
Vodafone Canada Inc.
100.00 Common shares
Cayman Islands
One Nexus Way, Camana Bay, Grand Cayman, KY1-9005,
Cayman Islands
CGP Investments (Holdings) Limited
100.00
Ordinary shares
China
Building 21, 11, Kangdin5g St., BDA, Beijing, 100176 – China
Vodafone Automotive Technologies
(Beijing) Co, Ltd
100.00
Ordinary shares
Level 9, Tower 2, China Central Place, Room 941, No.79 Jianguo
Road, Chaoyang District, Beijing, 100025, China
Vodafone Enterprise Communications
Technical Service (Shanghai) Co., Ltd.
Beijing Branch2
100.00
Branch
Room 1603, 16th Floor, 1200 Pudong Avenue, Free Trade Zone,
Shanghai, China
Vodafone Enterprise Communications
Technical Service (Shanghai) Co., Ltd.
100.00
Ordinary shares
Congo, The Democratic Republic of the
292 Avenue de La Justice, Commune de la Gombe, Kinshasa,
The Democratic Republic of the Congo
Vodacom Congo (RDC) SA5
33.20
Ordinary shares
Building Commimo II Ground Floor Right, 3157 Boulevard
du 30 Juin, Commune de la Gombe, Kinshasa, DRC Congo,
The Democratic Republic of the Congo
Vodacash S.A5
33.20
Ordinary shares
Company name
% of share
class held
by Group
Companies
Share Class
Cyprus
Ali Rıza Efendi Caddesi No:33/A Ortaköy, Lefkoşa, Cyprus
Vodafone Evde Operations Ltd
100.00
Ordinary shares
Vodafone Mobile Operations Limited
100.00
Ordinary shares
Czech Republic
náměstí Junkových 2, Prague 5, 15500, Czech Republic
Nadace Vodafone Česká Republika
100.00
Trustee
Oskar Mobil s.r.o.
100.00
Ordinary shares
Vodafone Czech Republic A.S.
100.00
Ordinary shares
Vodafone Enterprise Europe (UK)
Limited – Czech Branch2
100.00
Branch
Praha 4, Závišova 502/5, 14000, Nusle, Czech Republic
Závišova Real Estate, s.r.o.
100.00
Ordinary shares
Denmark
c/o Lundgrens Advokatpartnerselskab, Tuborg Boulevard 12,
2900, Hellerup, Denmark
Vodafone Enterprise Denmark A/S
100.00
Ordinary shares
Egypt
37 Kasr El Nil St, 4th. Floor, Cairo, Egypt
Starnet5
35.81
Ordinary shares
54 El Batal Ahmed Abed El Aziz, Mohandseen, Giza, Egypt
Sarmady Communications5
35.81
Ordinary shares
Building no. 2109 “VHUB1”, Smart Village, Cairo Alexandria, Egypt
Vodafone International Services LLC5
100.00
Ordinary shares
Site No 15/3C, Central Axis, 6th October City, Egypt
Vodafone Egypt Telecommunications
S.A.E.5
35.82
Ordinary shares
Smart Village C3 Vodafone Building, Egypt
Vodafone Data5
35.81
Ordinary shares
Vodafone Building Zahraa EL Maadi, Building A, Service Area D,
Maadi, Cairo, Egypt
Vodafone For Trading5
35.78
Ordinary shares
A full list of all of our subsidiaries, joint arrangements and associated undertakings is detailed below.
A full list of subsidiaries, joint arrangements and associated undertakings (as defined in the Large and Medium-sized Companies and Groups
(Accounts and Reports) Regulations 2008) as at 31 March 2024 is detailed below. No subsidiaries are excluded from the Group consolidation.
Unless otherwise stated the Company’s subsidiaries all have share capital consisting solely of ordinary shares and are indirectly held. The
percentage held by Group companies reflect both the proportion of nominal capital and voting rights unless otherwise stated. Summarised financial
information is provided in respect of the Group’s most significant joint arrangements and associates in note 12 ‘Investments in associates and joint
arrangements’.
Subsidiaries
A subsidiary is an entity directly or indirectly controlled by the Company. Control is achieved where the Company has existing rights that give it the
current ability to direct the activities that affect the Company’s returns and exposure or rights to variable returns from the entity. The results of
subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up
to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their
accounting policies into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on
consolidation. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Group’s equity therein.
Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling
shareholder’s share of changes in equity since the date of the combination. Total comprehensive income is attributed to non-controlling interests
even if this results in the non-controlling interests having a deficit balance.
31. Related undertakings
217
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Finland
c/o Eversheds Asianajotoimisto Oy, Fabianinkatu 29 B, Helsinki,
00100, Finland
Vodafone Enterprise Finland Oy
100.00
Ordinary shares
France
1300 route de Cretes, Le WTC, Bat I1, 06560, Valbonne Soph,
France
Vodafone Automotive Telematics
Development S.A.S
100.00
Ordinary shares
Le Belvédère, 1-7 cours Valmy, 92800, Puteaux, France
Vodafone Automotive France S.A.S
100.00
Ordinary shares
Vodafone Enterprise France SAS
100.00
New euro
shares
Rue Champollion, 22300, Lannion, France
Apollo Submarine Cable System Ltd
– French Branch2
100.00
Branch
Germany
Altes Forsthaus 2, 67661, Kaiserslautern, Germany
TKS Telepost Kabel-Service
Kaiserslautern GmbH3
100.00
Ordinary shares
Betastraße 6-8, 85774 Unterföhring, Germany
Vodafone Customer Care GmbH3
99.99
Ordinary shares
Vodafone Deutschland GmbH
99.99
Ordinary shares
Buschurweg 4, 76870 Kandel, Germany
Vodafone Automotive Deutschland
GmbH
100.00
Ordinary shares
Ferdinand-Braun-Platz 1, 40549, Düsseldorf, Germany
Vodafone Enterprise Germany GmbH
100.00
Ordinary A,
shares, Ordinary
B shares
Vodafone GmbH
100.00
Ordinary A
shares, Ordinary
B shares
Vodafone Group Services GmbH
100.00
Ordinary shares
Vodafone IoT Germany GmbH
100.00
Ordinary shares
Vodafone Institut für Gesellschaft und
Kommunikation GmbH
100.00
Ordinary shares
Vodafone Stiftung Deutschland
Gemeinnützige GmbH
100.00
Ordinary shares
Vodafone West GmbH
100.00
Ordinary shares
Friedrich-Wilhelm-Strasse 2, 38100, Braunschweig, Germany
KABELCOM Braunschweig Gesellschaft
Für Breitbandkabel-Kommunikation
Mit Beschränkter Haftung3
99.99
Ordinary shares
Holzmarkt 1, 50676, Köln, North Rhine-Westphalia, Germany
Grandcentrix GmbH
100.00
Ordinary shares
Nobelstrasse 55, 18059, Rostock, Germany
“Urbana Teleunion” Rostock GmbH &
Co.KG3
69.99
Ordinary shares
Seilerstrasse 18, 38440, Wolfsburg, Germany
KABELCOM Wolfsburg Gesellschaft für
Breitbandkabel-Kommunikation mit
beschränkter Haftung3
99.99
Ordinary shares
Greece
12,5 km National Road Athens – Lamia, Metamorfosi / Athens,
14452, Greece
Vodafone Innovus S.A
99.87
Ordinary shares
1-3 Tzavella str, 152 31 Halandri, Athens, Greece
Fiber2All S.A.
99.87
Ordinary shares
Vodafone-Panafon Hellenic
Teleco5mmunications Company S.A.
99.87
Ordinary shares
Pireos 163 & Ehelidon, Athens, 11854, Greece
360 Connect S.A.
99.87
Ordinary shares
Guernsey
Martello Court, Admiral Park, St. Peter Port, GY1 3HB, Guernsey
FB Holdings Limited
100.00
Ordinary shares
Le Bunt Holdings Limited
100.00
Ordinary shares
Silver Stream Investments Limited
100.00
Ordinary shares
Roseneath, The Grange, St Peter Port, GY1 2QJ, Guernsey
VBA Holdings Limited5
65.10
Ordinary shares,
Non-voting
irredeemable
non-cumulative
preference
shares
VBA International Limited5
65.10
Ordinary shares,
Non-voting
irredeemable
non-cumulative
preference
shares
Hong Kong
Level 24, Dorset House, Taikoo Place, 979 King’s Road, Quarry Bay,
Hong Kong
Vodafone Enterprise Hong Kong Ltd
100.00
Ordinary shares
Hungary
40-44 Hungaria Krt., Budapest, H-1087, Hungary
VSSB Vodafone Szolgáltató Központ
Budapest Zártkörűen Működő
Részvénytársaság
100.00
Registered
ordinary shares
India
10th Floor, Tower A&B, Global Technology Park, (Maple Tree
Building), Marathahalli Outer Ring Road, Devarabeesanahalli
Village, Varthur Hobli, Bengaluru, Karnataka, 560103, India
Cable & Wireless Networks India Private
Limited
100.00
Equity shares
Cable and Wireless (India) Limited –
Branch2
100.00
Branch
Cable and Wireless Global (India)
Private Limited
100.00
Equity shares
201-206, Shiv Smriti Chambers, 49/A, Dr. Annie Besant Road,
Mumbai, Maharashtra, Worli, 400018, India
Omega Telecom Holdings Private
Limited
100.00
Equity shares
Vodafone India Services Private Limited
100.00
Equity shares
Business@Mantri, Tower B, Wing no – B1 & B2, 3rd Floor, S. No.
– 197, Near Hotel Four Points, Lohegaon, Pune, Maharashtra,
411014, India
Vodafone Global Services Private
Limited
100.00
Equity shares
E-47, Bankra Super Market, Bankra, Howrah, West Bengal,
711403, India
Usha Martin Telematics Limited
100.00
Equity shares
Ireland
2nd Floor, Palmerston House, Fenian Street, DUBLIN 2, Ireland
Vodafone International Financing
Designated Activity Company
100.00
Ordinary shares
38/39 Fitzwilliam Square West, Dublin 2, D02 NX53, Ireland
Vodafone Enterprise Global Limited
100.00
Ordinary shares
Vodafone Global Network Limited
100.00
Ordinary shares
Mountainview, Leopardstown, Dublin 18, Ireland
VF Ireland Property Holdings Limited
100.00
Ordinary euro
shares
Vodafone Group Services Ireland
Limited
100.00
Ordinary shares
Vodafone Ireland Limited
100.00
Ordinary shares
Vodafone Ireland Marketing Limited
100.00
Ordinary shares
Vodafone Ireland Retail Limited
100.00
Ordinary shares
Italy
Piazzale Luigi Cadorna, 4, 20123, Milano, Italy
Vodafone Global Enterprise (Italy) S.R.L.
100.00
Ordinary shares
SS 33 del Sempione KM 35, 212, 21052 Busto Arsizio (VA), Italy
Vodafone Automotive Italia S.p.A
100.00
Ordinary shares
Via Astico 41, 21100 Varese, Italy
Vodafone Automotive Electronic
Systems S.r.L
100.00
Ordinary shares
Vodafone Automotive SpA
100.00
Ordinary shares
Vodafone Automotive Telematics Srl
100.00
Ordinary shares
Via Jervis 13, 10015, Ivrea (TO), Italy
VEI S.r.l.
100.00
Partnership
interest shares
Vodafone Italia S.p.A.
100.00
Ordinary shares
Via Lorenteggio 240, 20147, Milan, Italy
Vodafone Enterprise Italy S.r.L
100.00
Euro shares
Vodafone Gestioni S.p.A.
100.00
Ordinary shares
Vodafone IoT Italy, S.R.L.
100.00
Quotas shares
Vodafone Servizi E Tecnologie S.R.L.
100.00
Equity shares
IVia per Carpi 26/B, 42015, Correggio (RE), Italy
VND S.p.A.
100.00
Ordinary shares
Japan
KAKiYa building, 9F, 2-7-17 Shin-Yokohama, Kohoku-ku,
Yokoha-City, Kanagawa, 222-0033, Japan
Vodafone Automotive Japan KK
100.00
Ordinary shares
The Executive Centre, Level 20, Shin Marunouchi Center Building,
1-6-2 Marunouchi, Chiyoda-ku, Tokyo, 100-0005, Japan
Vodafone Enterprise U.K. – Japanese
Branch2
100.00
Branch
Vodafone Global Enterprise (Japan) K.K.
100.00
Ordinary shares
31. Related undertakings (continued)
Notes to the consolidated financial statements (continued)
218
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Jersey
44 Esplanade, St Helier, JE4 9WG, Jersey
Vodafone International 2 Limited
100.00
Ordinary shares
Kenya
6th Floor, ABC Towers, ABC Place, Waiyaki Way, Nairobi,
00100, Kenya
Vodafone Kenya Limited5
69.46
Ordinary voting
shares
The Riverfront, 4th floor, Prof. David Wasawo Drive, Off Riverside
Drive, Nairobi, Kenya
Vodacom Business (Kenya) Limited5
52.08
Ordinary shares
Korea, Republic of
ASEM Tower level 37, 517 Yeongdong-daero, Gangnam-gu, Seoul,
135-798, Korea, Republic of
Vodafone Enterprise Korea Limited
100.00
Ordinary shares
Lesotho
585 Mabile Road, Vodacom Park, Maseru, Lesotho
Vodacom Lesotho (Pty) Limited5
52.08
Ordinary shares
VCL Financial Services (Pty) Ltd5
52.08
Ordinary shares
Luxembourg
15 rue Edward Steichen, Luxembourg, 2540, Luxembourg
Tomorrow Street GP S.à r.l.
100.00
Ordinary shares
Vodafone Enterprise Luxembourg S.A.
100.00
Ordinary euro
shares
Vodafone International 1 S.à r.l.
100.00
Ordinary shares
Vodafone International M S.à r.l.
100.00
Ordinary shares
Vodafone Luxembourg S.à r.l.
100.00
Ordinary shares
Vodafone Procurement Company S.à
r.l.
100.00
Ordinary shares
Vodafone Roaming Services S.à r.l.
100.00
Ordinary shares
Vodafone Services Company S.à r.l.
100.00
Ordinary shares
Malaysia
Suite 13.03, 13th Floor, Menara Tan & Tan, 207 Jalan Tun Razak,
50400 Kuala Lumpur, Malaysia
Vodafone Global Enterprise (Malaysia)
Sdn Bhd
100.00
Ordinary shares
Malta
Portomaso Business Tower, Level 15B, St Julians, STJ 4011, Malta
Vodafone Holdings Limited
100.00
‘A’ Ordinary
shares, ‘B’
Ordinary shares
Vodafone Insurance Limited
100.00
‘A’ Ordinary
shares, ‘B’
Ordinary shares
Mauritius
10th Floor, Standard Chartered Towers, 19 Cybercity, Ebene,
Mauritius, Mauritius
Mobile Wallet VM15
65.10
Ordinary shares
Mobile Wallet VM25
65.10
Ordinary shares
VBA (Mauritius) Limited5
65.10
Ordinary shares,
Redeemable
preference
shares
Vodacom International Limited5
65.10
Ordinary shares,
Non-Cumulative
preference
shares
Fifth Floor, Ebene Esplanade, 24 Bank Street, Cybercity,
Ebene, Mauritius
Al-Amin Investments Limited
100.00
Ordinary shares
Array Holdings Limited
100.00
Ordinary shares
Asian Telecommunication Investments
(Mauritius) Limited
100.00
Ordinary shares
CCII (Mauritius), Inc.
100.00
Ordinary shares
CGP India Investments Ltd.
100.00
Ordinary shares
Euro Pacific Securities Ltd.
100.00
Ordinary shares
Mobilvest
100.00
Ordinary shares
Prime Metals Ltd.
100.00
Ordinary shares
Trans Crystal Ltd.
100.00
Ordinary shares
Vodafone Mauritius Ltd.
100.00
Ordinary shares
Vodafone Telecommunications (India)
Limited
100.00
Ordinary shares
Vodafone Tele-Services (India)
Holdings Limited
100.00
Ordinary shares
Mexico
Avenida Insurgentes Sur No. 1647, Piso 12, despacho 1202,
Colonia San José Insurgentes, Alcaldía Benito Juárez, C.P. 03900,
Ciudad de México, Mexico
Vodafone Empresa México S.de R.L. de
C.V.
100.00
Corporate
certificate series
A shares,
Corporate
certificate series
B shares
Mozambique
Rua dos Desportistas, Numero 649, Cidade de Maputo,
Mozambique
Vodacom Moçambique, SA5
55.33
Ordinary shares
Vodafone M-Pesa, S.A5
55.33
Ordinary shares
Netherlands
Rivium Quadrant 173, 15th Floor, 2909 LC, Capelle aan den IJssel,
Netherlands
Vodafone Enterprise Netherlands B.V.
100.00
Ordinary shares
Vodafone Europe B.V.
100.00
Ordinary shares
Vodafone International Holdings B.V.
100.00
Ordinary shares
Zuid-hollanden 7, Rode Olifant, Spaces, 2596AL, den Haag,
Netherlands
IoT. nxt USA BV5
42.31
Ordinary shares
IOT.NXT B.V.5
42.31
Ordinary shares
IoT.nxt EMENA B.V
42.31
Ordinary shares
IoT.nxt Europe BV5
42.31
Ordinary shares
New Zealand
74 Taharoto Road, Takapuna, Auckland, 0622, New Zealand
Vodafone Enterprise Hong Kong
Limited – New Zealand Branch2
100.00
Branch
Norway
c/o EconPartner AS, Dronning Mauds gate 15, Oslo, 0250, Norway
Vodafone Enterprise Norway AS
100.00
Ordinary shares
Oman
Knowledge Oasis Muscat, Al-seeb, Muscat, Governorate P.O Box
104 135, Oman
Vodafone Services LLC
100.00
Shares
Poland
ul. Towarowa 28, 00-839, Warsaw, Poland
Vodafone Business Poland sp. z o.o.
100.00
Ordinary shares
Portugal
Av. D. João II, nº 36 – 8º Piso, 1998 – 017, Parque das Nações,
Lisboa, Portugal
DABCO Portugal, Lda
80.20
Ordinary shares
Oni Way – Infocomunicacoes, S.A
100.00
Ordinary shares
Vodafone Enterprise Spain, S.L.U. –
Portugal Branch2
100.00
Branch
Vodafone Portugal – Comunicacoes
Pessoais, S.A.
100.00
Ordinary shares
Vodafone Solutions, Unipessoal LDA
100.00
Quotas shares
Vodafone IoT Portugal, Unipessoal Lda.
100.00
Ordinary shares
219
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Romania
1 A Constantin Ghercu Street, 10th Floor, 6th District, Bucharest,
Romania
UPC Services S.R.L. (in liquidation)
100.00
Ordinary shares
18 Diligenței Steet, 1st floor, Building C1, Ploiesti, Prahova County,
Romania
Evotracking SRL
100.00
Ordinary shares
201 Barbu Vacarescu Street, 5th floor, 2nd District, Bucharest,
Romania
Vodafone External Services SRL
100.00
Ordinary shares
Vodafone Foundation
100.00
Sole member
201 Barbu Vacarescu, 4th floor, 2nd District, Bucharest, Romania
Vodafone Romania S.A
100.00
Ordinary shares
62 D Nordului Street, District 1, Bucharest, Romania
UPC Foundation
100.00
Sole member
Oltenitei Street no. 2, City Offices Building, 3rd Floor, Bucharest
4th District, Romania
Vodafone România Technologies SRL
100.00
Ordinary shares
Sectorul 2, Strada Barbu Văcărescu, Nr. 201, Etaj 1, Bucharest,
Romania
Vodafone România M – Payments SRL
100.00
Ordinary shares
Russian Federation
Build. 2, 14/10, Chayanova str., 125047, Moscow, Russian
Federation
Cable & Wireless CIS Svyaz LLC
100.00
Charter capital
shares
Serbia
Vladimira Popovića 38-40, New Belgrade, 11070, Serbia
Vodafone Enterprise Equipment
Limited Ogranak u Beogradu – Serbia
Branch2
100.00
Branch
Singapore
Asia Square Tower 2, 12 Marina View, #17-01, 018961, Singapore
Vodafone Enterprise Singapore Pte.Ltd
100.00
Ordinary shares
Slovakia
Karadžičova 2, mestská časť Staré mesto, Bratislava, 811 09,
Slovakia850 New Burton Rd., Suite 201, Dover, County of Kent,
Delaware, 19904, United States
Vodafone Global Network Limited –
Slovakia Branch2
100.00
Branch
Prievozská 6, Bratislava, 821 09, Slovakia
Vodafone Czech Republic A.S. –
Slovakia Branch2
100.00
Branch
South Africa
9 Kinross Street, Germiston South, 1401, South Africa
Vodafone Holdings (SA) Proprietary
Limited
100.00
Ordinary shares
Vodafone Investments (SA) Proprietary
Limited
100.00
Ordinary A
shares, ‘B’
Ordinary no par
value shares
Irene Link Building C, Third Floor, 5 Impala Avenue, Doringkloof,
Centurion, Gauteng, 0046, South Africa
10T Holdings Proprietary Limited5
42.31
Ordinary shares
IoT.nxt (Pty) Limited5
42.31
Ordinary shares
IoT.nxt Development (Pty) Limited5
42.31
Ordinary shares
Vodacom Corporate Park, 082 Vodacom Boulevard, Midrand,
1685, South Africa
Infinity Services Partner Company5
65.10
Ordinary shares
Jupicol (Proprietary) Limited5
45.57
Ordinary shares
MAST Services Proprietary Limited5
65.10
Ordinary shares
Mezzanine Ware (RF) Proprietary
Limited5
58.59
Ordinary shares
Motifprops 1 (Proprietary) Limited5
65.10
Ordinary shares
Storage Technology Services (Pty)
Limited5
33.20
Ordinary shares
Vodacom (Pty) Limited5
65.10
Ordinary shares,
Ordinary A
shares
Vodacom Business Africa Group (Pty)
Limited5
65.10
Ordinary shares
Vodacom Business Africa SA (Pty)
Limited5
65.10
Ordinary shares
Vodacom Financial Services
(Proprietary) Limited5
65.10
Ordinary shares
Vodacom Group Limited
65.10
Ordinary shares
Vodacom Insurance Administration
Company (Proprietary) Limited5
65.10
Ordinary shares
Vodacom Insurance Company (RF)
Limited5
65.10
Ordinary shares
Vodacom International Holdings (Pty)
Limited5
65.10
Ordinary shares
Vodacom Life Assurance Company
(RF) Limited5
65.10
Ordinary shares
Vodacom Payment Services
(Proprietary) Limited5
65.10
Ordinary shares
Vodacom Properties No 1 (Proprietary)
Limited5
65.10
Ordinary shares
Vodacom Properties No.2 (Pty)
Limited5
65.10
Ordinary shares
Wheatfields Investments 276
(Proprietary) Limited5
65.10
Ordinary shares
XLink Communications (Proprietary)
Limited5
65.10
Ordinary A
shares
Spain
Antracita, 7 – 28045, Madrid, Spain
Vodafone Automotive Iberia S.L.
100.00
Ordinary shares
Avenida de América 115, 28042, Madrid, Spain
Vodafone Energía, S.L.U.
100.00
Ordinary shares
Vodafone Enterprise Spain SLU
100.00
Ordinary euro
shares
Vodafone España, S.A.U.
100.00
Ordinary shares
Vodafone Holdings Europe, S.L.U.
100.00
Ordinary shares
Vodafone ONO, S.A.U.
100.00
Ordinary shares
Vodafone Servicios, S.L.U.
100.00
Ordinary shares
Paseo de la Alameda de Osuna, 14, Hortaleza, 28042, Madrid, Spain
Vodafone IoT Spain, S.L.
100.00
Ordinary shares
Torre Norte Adif, Explanada de la Estación no 7, 29002, Málaga, Spain
Vodafone Intelligent Solutions España,
S.L.U.
100.00
Ordinary shares
Sweden
c/o Hellström advokatbyrå, Box 7305, 103 90, Stockholm, Sweden
Vodafone Enterprise Sweden AB
100.00
Ordinary shares,
Shareholder’s
contribution
shares
Switzerland
c/o BDO AG, Schiffbaustrasse 2, 8005, Zurich, Switzerland
Vodafone Enterprise Switzerland AG
100.00
Ordinary shares
Taiwan
22F., No.100, Songren Road., Xinyi District, Taipei City, 11070,
Taiwan
Vodafone Global Enterprise Taiwan
Limited
100.00
Ordinary shares
Tanzania, United Republic of
15 Floor, Vodacom Tower, Ursino Estate, Plot No. 23, Bagamoyo
Road, Dar es Salaam, Tanzania, United Republic of
M-Pesa Limited5
48.82
Ordinary A
shares, Ordinary
B shares
Shared Networks Tanzania Limited5
48.82
Ordinary shares
Vodacom Tanzania Public Limited
Company5
48.82
Ordinary shares
3rd Floor, Maktaba (Library), ComplexBibi, Titi Mohaned Road,
Dar es Salaam, Tanzania, United Republic of
Gateway Communications Tanzania
Limited5
64.45
Ordinary shares
31. Related undertakings (continued)
Notes to the consolidated financial statements (continued)
220
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Thailand
725 Metropolis Building, 20th floor, Unit 100, Sukhumvit Road,
Klongton Nua Sub-district, Watthana District, Bangkok, 10110,
Thailand
Vodafone Business Siam Co., Ltd.
100.00
Ordinary shares
Turkey
Büyükdere Caddesi, No:251, Maslak, Şişli / İstanbul, 34398, Turkey
Vodafone Bilgi Ve Iletisim Hizmetleri AS
100.00
Registered
shares
Vodafone Dagitim, Servis ve Icerik
Hizmetleri A.S.
100.00
Ordinary shares
Vodafone Holding A.S.
100.00
Registered
shares
Vodafone Kule ve Altyapi Hizmetleri A.S.
100.00
Ordinary shares
Vodafone Mall Ve Elektronik Hizmetler
Ticaret AS
100.00
Ordinary shares
Vodafone Net İletişim Hizmetleri A.S.
100.00
Ordinary shares
Vodafone Telekomunikasyon A.S
100.00
Registered
shares
İTÜ Ayazağa Kampüsü, Koru Yolu, Arı Teknokent Arı 3 Binası,
Maslak, İstanbul, 586553, Turkey
Vodafone Teknoloji Hizmetleri A.S.
100.00
Registered
shares
Maslak Mah. AOS 55 Sk. 42 Maslak Sit. B Blok Apt. No: 4/663,
Sarıyer Istanbul, Turkey
Vodafone Sigorta Aracilik Hizmetleri A.S.
100.00
Ordinary shares
Vodafone Elektronik Para Ve Ödeme
Hizmetleri A.S.
100.00
Registered
shares
Vodafone Finansman A.S.
100.00
Ordinary shares
Maslak Mah. Büyükdere Cad. Büyükdere No: 251, Sarıyer, Istanbul,
34453, Turkey
VOIS Turkey Akilli Çözümler
Limited Şirket
100.00
Ordinary shares
Ukraine
Bohdana Khmelnytskogo Str. 19-21, Kyiv, Ukraine
LLC Vodafone Enterprise Ukraine
100.00
Ownership
percentage
shares
United Arab Emirates
16-SD 129, Ground Floor, Building 16-Co Work, Dubai Internet City,
United Arab Emirates
Vodacom Fintech Services FZ-LLC5
65.10
Ordinary shares
Office 101, 1st Floor, DIC Building 1, Dubai Internet City, Dubai,
United Arab Emirates
Vodafone Enterprise Europe (UK)
Limited – Dubai Branch2
100.00
Branch
United Kingdom
11 Staple Inn Building, London, WC1V 7QH, United Kingdom
Vodacom Business Africa Group
Services Limited5
65.10
Ordinary shares,
Preference
shares
Vodacom Investments Company
Proprietary Limited5
65.10
Ordinary shares
Vodacom UK Limited5
65.10
Ordinary shares,
Ordinary B
shares,
Non-
redeemable
ordinary A
shares,
Non-
redeemable
preference
shares
50 Lothian Road, Festival Square, Edinburgh, EH3 9WJ, United
Kingdom
Thus Group Holdings Limited
100.00
Ordinary shares
Thus Group Limited
100.00
Ordinary shares
Thus Profit Sharing Trustees Limited
100.00
Ordinary shares
Vodafone (Scotland) Limited
100.00
Ordinary shares
Pinnacle Cellular Group Limited
100.00
Ordinary shares
3 More London, Riverside, London, SE1 2AQ, United Kingdom
IoT Nxt UK Limited
42.31
Ordinary shares
One Kingdom Street, London, W2 6BY, United Kingdom
DABCo Limited
80.00
Ordinary shares
Quarry Corner, Dundonald, Belfast, BT16 1UD, Northern Ireland
Energis (Ireland) Limited
100.00
A Ordinary
shares, B
Ordinary shares,
C Ordinary
shares, D
Ordinary shares
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN,
United Kingdom
Apollo Submarine Cable System
Limited
100.00
Ordinary shares
Bluefish Communications Limited
(in liquidation)
25.00
Ordinary A
shares, Ordinary
B shares,
Ordinary C
shares, Ordinary
D shares
Cable & Wireless Aspac Holdings
Limited
100.00
Ordinary shares
Cable & Wireless CIS Services Limited
100.00
Ordinary shares
Cable & Wireless Communications
Data Network Services Limited
100.00
‘A’ Ordinary
shares, ‘B’
Ordinary shares
Cable & Wireless Europe Holdings
Limited
100.00
Ordinary shares
Cable & Wireless Global
Telecommunication Services Limited
100.00
Ordinary shares
Cable & Wireless UK Holdings Limited
100.00
Ordinary shares
Cable & Wireless Worldwide Limited
100.00
Ordinary shares
Cable & Wireless Worldwide Voice
Messaging Limited (in process of
dissolution)
100.00
Ordinary shares
Cable and Wireless (India) Limited
100.00
Ordinary shares
Cable and Wireless Nominee Limited
100.00
Ordinary shares
Central Communications Group
Limited
100.00 Ordinary Shares,
Ordinary A
shares
Energis Communications Limited
100.00
Ordinary shares
Energis Squared Limited
100.00
Ordinary shares
London Hydraulic Power Company
(The)
100.00
Ordinary shares,
5%
Non-Cumulative
preference
shares
MetroHoldings Limited (in process of
dissolution)
100.00
Ordinary shares
Navtrak Ltd
100.00
Ordinary shares
Project Telecom Holdings Limited1
100.00
Ordinary shares
Rian Mobile Limited
100.00
Ordinary shares
Talkmobile Limited
100.00
Ordinary shares
The Eastern Leasing Company Limited
100.00
Ordinary shares
Thus Limited
100.00
Ordinary shares
Vodafone 2.
100.00
Ordinary shares
Vodafone Automotive UK Limited
100.00
Ordinary shares
Vodafone Consolidated Holdings
Limited
100.00
Ordinary shares
Vodafone Corporate Limited
100.00
Ordinary shares
Vodafone Corporate Secretaries
Limited1
100.00
Ordinary shares
Vodafone DC Pension Trustee
Company Limited1
100.00
Ordinary shares
221
Vodafone Group Plc
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Strategic report
Governance
Financials
Other information
Vodafone Distribution Holdings Limited
100.00
Ordinary shares
Vodafone Enterprise Corporate
Secretaries Limited
100.00
Ordinary shares
Vodafone Enterprise Equipment
Limited
100.00
Ordinary shares
Vodafone Enterprise Europe (UK)
Limited
100.00
Ordinary shares
Vodafone Enterprise U.K.
100.00
Ordinary shares
Vodafone European Investments1
100.00
Ordinary shares
Vodafone Finance Limited1
100.00
Ordinary shares
Vodafone Finance Management
100.00
Ordinary shares
Vodafone Global Enterprise Limited
100.00
Ordinary shares,
Deferred shares,
B deferred
shares
Vodafone Group (Directors) Trustee
Limited1
100.00
Ordinary shares
Vodafone Group Pension Trustee
Limited1
100.00
Ordinary shares
Vodafone Group Services Limited
100.00
Ordinary shares,
deferred shares
Vodafone Group Services No.2 Limited1
100.00
Ordinary shares
Vodafone Group Share Trustee
Limited1
100.00
Ordinary shares
Vodafone International 2 Limited – UK
Branch2
100.00
Branch
Vodafone International Operations
Limited
100.00
Ordinary shares
Vodafone Investments Limited1
100.00
Ordinary shares,
Zero coupon
redeemable
preference
shares
Vodafone IoT UK Limited
100.00
Ordinary shares
Vodafone IP Licensing Limited1
100.00
Ordinary shares
Vodafone Limited
100.00
Ordinary shares
Vodafone Mobile Enterprises Limited
100.00
Ordinary shares
Vodafone Mobile Network Limited
100.00
Ordinary shares
Vodafone Nominees Limited1
100.00
Ordinary shares
Vodafone Oceania Limited
100.00
Ordinary shares
Vodafone Overseas Finance Limited
100.00
Ordinary shares
Vodafone Partner Services Limited
100.00
Ordinary shares,
Redeemable
preference
shares
Vodafone Retail (Holdings) Limited
100.00
Ordinary shares
Vodafone Sales & Services Limited
100.00
Ordinary shares
Vodafone Shared Operations Limited
100.00
Ordinary shares
Vodafone Shared Services UK Limited
100.00
Ordinary shares
Vodafone UK Foundation
100.00
Sole member
Vodafone UK Limited1
100.00
Ordinary shares
Vodafone UK Trading Holdings Limited
100.00
Ordinary shares
Vodafone Ventures Limited1
100.00
Ordinary shares
Vodaphone Limited
100.00
Ordinary shares
Your Communications Group Limited
100.00
B Ordinary
shares,
Redeemable
preference
shares
United States
1209 Orange Street, Wilmington DE 19801, United States
IoT nxt USA Inc5
42.31
Common stock
1450 Broadway, Fl 11, Suite 104, New York NY 10018, United States
Cable & Wireless Americas Systems,
Inc.
100.00
Common stock
shares
Vodafone Americas Virginia Inc.
100.00
Common stock
shares
Vodafone US Inc.
100.00
Common stock
shares,
Preferred stock
shares
1615 Platte Street, Suite 02-115, Denver CO 80202, United States
Vodafone Americas Foundation
100.00
Trustee
850 New Burton Rd., Suite 201, Dover, County of Kent, Delaware,
19904, United States
Vodafone IoT Incorporated
100.00
Common stock
shares
31. Related undertakings (continued)
Notes to the consolidated financial statements (continued)
222
Vodafone Group Plc
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Strategic report
Governance
Financials
Other information
Associated undertakings and joint
arrangements
Australia
Level 27, Tower Two, International Towers Sydney, 200 Barangaroo
Avenue , Barangaroo NSW 2000, Australia
3.6 GHz Spectrum Pty Ltd
25.05
Ordinary shares
AAPT Limited
25.05
Ordinary shares
ACN 088 889 230 Pty Ltd
25.05
Ordinary shares
ACN 139 798 404 Pty Ltd
25.05
Ordinary shares
Adam Internet Holdings Pty Ltd
25.05
Ordinary shares
Adam Internet Pty Ltd
25.05
A shares, B
shares, Ordinary
shares
Agile Pty Ltd
25.05
Ordinary shares
AlchemyIT Pty Ltd
25.05
Ordinary shares
Chariot Pty Ltd
25.05
Ordinary shares
Chime Communications Pty Ltd
25.05
Ordinary shares
Connect West Pty Ltd
25.05
Ordinary shares
Destra Communications Pty Ltd
25.05
Ordinary shares
Digiplus Contracts Pty Ltd
25.05
Ordinary shares
Digiplus Holdings Pty Ltd
25.05
Ordinary shares
Digiplus Investments Pty Ltd
25.05
Ordinary shares
Digiplus Pty Ltd
25.05
Ordinary shares
H3GA Properties (No.3) Pty Limited
25.05
Ordinary shares
iiNet Labs Pty Ltd
25.05
Ordinary shares
iiNet Limited
25.05
Ordinary shares
Internode Pty Ltd
25.05
Ordinary shares,
Class B shares
IntraPower Pty Limited
25.05
Ordinary shares
Intrapower Terrestrial Pty Ltd
25.05
Ordinary shares
IP Group Pty Ltd
25.05
Ordinary shares
IP Services Xchange Pty Ltd
25.05
A shares, B
shares
Kooee Communications Pty Ltd
25.05
Ordinary shares
Kooee Mobile Pty Ltd
25.05
Ordinary shares
Mercury Connect Pty Ltd
25.05
Ordinary shares,
E class shares
Mobile JV Pty Limited
25.05
Ordinary shares
Mobileworld Communications Pty Limited
25.05
Ordinary shares
Mobileworld Operating Pty Ltd
25.05
Ordinary shares
Netspace Online Systems Pty Ltd
25.05
Ordinary shares
Numillar IPS Pty Ltd
25.05
Ordinary shares
PIPE International (Australia) Pty Ltd
25.05
Ordinary shares
PIPE Networks Pty Limited
25.05
Ordinary shares
PIPE Transmission Pty Limited
25.05
Ordinary shares
PowerTel Limited
25.05
Ordinary shares
Request Broadband Pty Ltd
25.05
Ordinary shares
Soul Communications Pty Ltd
25.05
Ordinary shares
Soul Contracts Pty Ltd
25.05
Ordinary shares
Soul Pattinson Telecommunications
Pty Ltd
25.05
Ordinary shares
SPT Telecommunications Pty Ltd
25.05
Ordinary shares
SPTCom Pty Ltd
25.05
Ordinary shares
Telecom Enterprises Australia Pty Limited
25.05
Ordinary shares
Telecom New Zealand Australia Pty Ltd
25.05
Ordinary shares,
Redeemable
preference
shares
TPG Corporation Limited
25.05
Ordinary shares
TPG Energy Pty Ltd
25.05
Ordinary shares
TPG Finance Pty Limited
25.05
Ordinary shares
TPG Holdings Pty Ltd
25.05
Ordinary shares
TPG Internet Pty Ltd
25.05
Ordinary shares
TPG JV Company Pty Ltd
25.05
Ordinary shares
TPG Network Pty Ltd
25.05
Ordinary shares
TPG Telecom Limited
25.05
Ordinary shares
TransACT Capital Communications Pty Ltd
25.05
Ordinary shares
TransACT Communications Pty Ltd
25.05
Ordinary shares
TransACT Victoria Communications
Pty Ltd
25.05
Ordinary shares
TransACT Victoria Holdings Pty Ltd
25.05
Ordinary shares
Trusted Cloud Pty Ltd
25.05
Ordinary shares
Trusted Cloud Solutions Pty Ltd
25.05
Ordinary shares
Value Added Network Pty Ltd
25.05
Ordinary shares
Vision Network Pty Limited
25.05
Ordinary shares
Vodafone Australia Pty Limited
25.05
Ordinary shares,
Class B shares,
Redeemable
preference
shares
Vodafone Foundation Australia Pty Limited
25.05
Ordinary shares
Vodafone Hutchison Receivables Pty
Limited
25.05
Ordinary shares
Vodafone Hutchison Spectrum Pty
Limited
25.05
Ordinary shares
Vodafone Network Pty Limited
25.05
Ordinary shares
Vodafone Pty Limited
25.05
Ordinary shares
VtalkVoip Pty Ltd
25.05
Ordinary shares
Westnet Pty Ltd
25.05
Ordinary shares
Belgium
Space Court of Justice, Rue aux Laines 70, 1000 Brussels, Belgium
Utiq S.A
25.00
Ordinary shares
Bermuda
Clarendon House, 2 Church St, Hamilton, HM11, Bermuda
PPC 1 Limited
25.05
Ordinary shares
Czech Republic
Praha 4, Závišova 502/5, 14000, Nusle, Czech Republic
Vantage Towers s.r.o.4
53.88
Ordinary shares
U Rajské zahrady 1912/3, Praha 3, 130 00, Czech Republic
COOP Mobil s.r.o.
33.33
Ordinary shares
Egypt
23 Kasr El Nil St, Cairo, 11211, Egypt
Wataneya Telecommunications S.A.E
50.00
Ordinary shares
Germany
38 Berliner Allee, 40212, Düsseldorf, Germany
MNP Deutschland Gesellschaft
bürgerlichen Rechts
33.33
Partnership
share
Ferdinand-Braun-Platz 1, 40549, Düsseldorf, Germany
OXG Glasfaser Beteiligungs-GmbH
50.00
Ordinary shares
OXG Glasfaser GmbH
50.00
Ordinary shares
Nobelstrasse 55, 18059, Rostock, Germany
Verwaltung “Urbana Teleunion” Rostock
GmbH3
50.00
Ordinary shares
Prinzenallee 11-13, 40549, Düsseldorf, Germany
Oak Holdings 1 GmbH
60.33
Ordinary shares
Oak Holdings 2 GmbH
60.33
Ordinary shares
Oak Holdings GmbH
60.33
Ordinary shares
Oak Renewables GmbH
60.33
Ordinary shares
Vantage Towers AG
53.88
Ordinary shares
Vantage Towers Erste
Verwaltungsgesellschaft mbH4
53.88
Ordinary shares
Greece
2 Adrianeiou str, Athens, 11525, Greece
Vantage Towers Single Member Societe
Anonyme4
53.88
Ordinary shares
43-45 Valtetsiou Str., Athens, Greece
Safenet N.P,A.
24.97
Issued shares
56 Kifisias Avenue & Delfwn, Marousi, 151 25, Greece
Tilegnous IKE
33.29
Ordinary shares
Marathonos Ave 18 km & Pylou, Pallini, Attica, Pallini, Attica,
15351, Greece
Victus Networks S.A.
49.94
Ordinary shares
Hungary
Boldizsár utca 2, Budapest, 1112, Hungary
Vantage Towers Zártkörűen Működő
Részvénytársaság4
53.88
Ordinary shares
India
10th Floor, Birla Centurion, Century Mills Compound, Pandurang
Budhkar Marg, Worli, Mumbai, Maharashtra, 400030, India
Vodafone Foundation6
30.90
Ordinary shares
Vodafone Idea Shared Services Limited6
31.37
Ordinary shares
Vodafone Idea Technology Solutions
Limited6
31.37
Ordinary shares
Vodafone m-pesa Limited6
31.37
Ordinary shares
You Broadband India Limited6
31.37
Equity shares
Building No.10, Tower-A, 4th Floor, DLF Cyber City, Gurugram,
Haryana, 122002, India
Indus Towers Limited
21.05
Ordinary shares
Suman Tower, Plot No. 18, Sector No. 11, Gandhinagar, 382011,
Gujarat, India
Vodafone Idea Limited
31.37
Equity shares
Vodafone Idea Manpower Services
Limited6
30.99
Ordinary shares
Vodafone House, Corporate Road, Prahladnagar, Off S. G. Highway,
Ahmedabad, Gujarat, 380051, India
Vodafone Idea Business Services Limited6
31.36
Ordinary shares
Vodafone Idea Communication Systems
Limited6
31.37
Ordinary shares
Vodafone Idea Telecom Infrastructure
Limited6
31.37
Ordinary shares
223
Vodafone Group Plc
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Strategic report
Governance
Financials
Other information
Ireland
Mountainview, Leopardstown, Dublin 18, Ireland
Vantage Towers Limited4
53.88
Ordinary shares
The Herbert Building, The Park, Carrickmines, Dublin, Ireland
Siro DAC
50.00
Ordinary shares
Siro JV Holdco Limited
50.00
Ordinary B
shares
Italy
Via Gaetana Negri 1, 20123, Milano, Italy
Infrastrutture Wireless Italiana S.p.A.
17.87
Ordinary shares
Kenya
LR No. 13263 Safaricom House, PO Box 66827, 00800,
Nairobi, Kenya
Safaricom PLC
27.74
Ordinary shares
Safaricom House, Waiyaki Way Westlands, Nairobi, Kenya
M-PESA Africa Limited5
46.42
Ordinary shares
6th Floor, ABC Towers, ABC Place, Waiyaki Way, Nairobi, 00100, Kenya
M-PESA Holding Co. Limited
27.74
Ordinary shares
Luxembourg
15 rue Edward Steichen, Luxembourg, 2540, Luxembourg
Tomorrow Street SCA
50.00
Ordinary B
shares, Ordinary
C shares
Netherlands
Avenue Ceramique 300, 6221 Kx, Maastricht, Netherlands
Vodafone Antennelocaties B.V.
50.00
Ordinary shares
Vodafone Libertel B.V.
50.00
Ordinary shares
Boven Vredenburgpassage 128, 3511 WR, Utrecht, Netherlands
Amsterdamse Beheer- en
Consultingmaatschappij B.V.
50.00
Ordinary shares
Esprit Telecom B.V.
50.00
Ordinary shares
FinCo Partner 1 B.V.
50.00
Ordinary shares
LGE HoldCo V B.V.
50.00
Ordinary shares
LGE HoldCo VI B.V.
50.00
Ordinary shares
LGE Holdco VII B.V.
50.00
Ordinary shares
LGE HoldCo VIII B.V.
50.00
Ordinary shares
Vodafone Financial Services B.V.
50.00
Ordinary shares
Vodafone Nederland Holding I B.V.
50.00
Ordinary shares
Vodafone Nederland Holding II B.V.
50.00
Ordinary shares
VodafoneZiggo Employment B.V.
50.00
Ordinary shares
VodafoneZiggo Group B.V.
50.00
Ordinary shares
VodafoneZiggo Group Holding B.V.
50.00
Ordinary shares
VZ Financing I B.V.
50.00
Ordinary shares
VZ Financing II B.V.
50.00
Ordinary shares
VZ FinCo B.V.
50.00
Ordinary shares
VZ PropCo B.V.
50.00
Ordinary shares
VZ Secured Financing B.V.
50.00
Ordinary shares
XB Facilities B.V.
50.00
Ordinary shares
Ziggo B.V.
50.00
Ordinary shares
Ziggo Deelnemingen B.V.
50.00
Ordinary shares
Ziggo Finance 2 B.V.
50.00
Ordinary shares
Ziggo Netwerk II B.V.
50.00
Ordinary shares
Ziggo Real Estate B.V.
50.00
Ordinary shares
Ziggo Services B.V.
50.00
Ordinary shares
Ziggo Services Employment B.V.
50.00
Ordinary shares
Ziggo Services Netwerk 2 B.V.
50.00
Ordinary shares
Ziggo Zakelijk Services B.V.
50.00
Ordinary shares
Zoranet Connectivity Services B.V.
50.00
Ordinary shares
ZUM B.V.
50.00
Ordinary shares
Media Parkboulevard 2, 1217 WE Hilversum, Netherlands
Liberty Global Content Netherlands B.V.
50.00
Ordinary shares
Rivium Quadrant 175, 2909 LC, Capelle aan den IJssel, Netherlands
Central Tower Holding Company B.V.4
53.88
Ordinary shares
Winschoterdiep 60, 9723 AB Groningen, Netherlands
Zesko B.V.
50.00
Ordinary shares
Ziggo Bond Company B.V.
50.00
Ordinary shares
Ziggo Netwerk B.V.
50.00
Ordinary shares
New Zealand
Tompkins Wake, Level 11, 41 Shortland Street, Auckland, 1010,
New Zealand
iiNet (New Zealand) AKL Limited
25.05
Ordinary shares
Portugal
Edif. Arquiparque VII, R Dr António Loureiro Borges, 7, 3.º, 1495-131
ALGÉS, Algés, Oeiras, Portugal
Vantage Towers, S.A.4
53.88
Ordinary shares
Espaço Sete Rios, LEAP Rua de Campolide, 351, 0.05, 1070-034,
Lisboa, Portugal
Dual Grid – Gestão de Redes Partilhadas,
S.A.
50.00
Ordinary shares
Rua Pedro e Inês, Lote 2.08.01, 1990-075, Parque das Nações,
Lisboa, Portugal
Sport TV Portgugal, S.A.
25.00
Nominative
shares
Romania
Calea Floreasca no. 169A, 3rd floor, District 1, Bucharest, România,
Romania
Vantage Towers S.R.L.4
53.88
Ordinary shares
Floor 3, Module 2, Connected buildings III, Nr. 10A, Dimitrie Pompei
Boulevard, Bucharest, Sector 2, Romania
Netgrid Telecom SRL
50.00
Ordinary shares
Russian Federation
Building 3, 11, Promyshlennaya Street, Moscow, 115 516, Russian
Federation
Autoconnex Limited
35.00
Ordinary shares
South Africa
76 Maude Street, Sandton, Johannesberg, 2196, South Africa
Waterberg Lodge (Proprietary) Limited5
32.55
Ordinary shares
Celtis Plaza North, 1085 Schoeman Street, Hatfield, Pretoria,
0028, South Africa
Afri G I S (Pty) Ltd5
21.16
Ordinary shares
Rigel Office Park Block A, No 446 Rigel Avenue South,
Erasmu, South Africa
Canard Spatial Technologies Proprietary
Limited5
21.16
Ordinary shares
Vodacom Corporate Park, 082 Vodacom Boulevard, Midrand,
1685, South Africa
M-Pesa S.A (Proprietary) Limited5
46.42
Ordinary shares
Spain
Calle San Severo 22, 28042, Madrid, Spain, Spain
Vantage Towers, S.L.U.4
53.88
Ordinary shares
Tanzania, United Republic of
Plot No. 23, Ursino Estate, Bagamoyo Road, Dar es Salaam,
Tanzania, United Republic of
Vodacom Trust Limited5
(in process of dissolution)
48.82
Ordinary A
shares, Ordinary
B shares
Turkey
Çifte Havuzlar Mah Eski Londra Asfaltı Cad No: 151/1E/301,
Esenler, Istanbul, Turkey
FGS Bilgi Islem Urunler Sanayi ve Ticaret
AS
50.00
Ordinary shares
United Kingdom
24/25 The Shard, 32 London Bridge Street, London, SE1 9SG,
United Kingdom
Digital Mobile Spectrum Limited
25.00
Ordinary shares
3 More London Riverside, London, SE1 2AQ, United Kingdom
VodaFamily Ethiopia Holding Company
Limited5
31.47
Ordinary shares
Griffin House, 161 Hammersmith Road, London, W6 8BS,
United Kingdom
Cable & Wireless Trade Mark Management
Limited
50.00
Ordinary B
shares
Hive 2, 1530 Arlington Business Park, Theale, Reading, Berkshire,
RG7 4SA, United Kingdom
Cornerstone Telecommunications
Infrastructure Limited5
26.94
Ordinary shares
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN,
United Kingdom
Vodafone Hutchison (Australia) Holdings
Limited
50.00
Ordinary shares
United States
251 Little Falls Drive, Wilmington DE 19808, United States
LG Financing Partnership
50.00
Partnership
interest
PPC 1 (US) Inc.
25.05
Ordinary shares
Ziggo Financing Partnership
50.00
Partnership
interest
Notes:
1. Directly held by Vodafone Group Plc.
2. Branches.
3. Shareholding is indirect through Vodafone Deutschland GmbH.
4. Shareholding is indirect through Vantage Towers A.G.
5. Shareholding is indirect through Vodacom Group Limited. The
indirect shareholding is calculated using the 65.10% ownership
interest in Vodacom Group Limited.
6. Includes the indirect interest held through Vodafone Idea
Limited.
31. Related undertakings (continued)
Notes to the consolidated financial statements (continued)
224
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
225
Vodafone Group Plc
Annual Report 2024
Strategic report
Governance
Financials
Other information
Selected financial information
The table below shows selected financial information in respect of subsidiaries that have non-controlling interests that are material to the Group.
Vodacom Group Limited
2024
2023
Re-presented1
€m
€m
Summary comprehensive income information
Revenue
7,420
8,076
Profit for the financial year
920
1,245
Other comprehensive expense
217
193
Total comprehensive income
1,137
1,438
Other financial information
Profit for the financial year allocated to non-controlling interests
368
474
Dividends paid to non-controlling interests
260
342
Summary financial position information
Non-current assets
7,517
7,766
Current assets
3,437
3,429
Total assets
10,954
11,195
Non-current liabilities
(3,198)
(2,880)
Current liabilities
(3,446)
(3,905)
Total assets less total liabilities
4,310
4,410
Equity shareholders’ funds
3,275
3,327
Non-controlling interests
1,035
1,083
Total equity
4,310
4,410
Statement of cash flows
Net cash inflow from operating activities
2,285
2,565
Net cash outflow from investing activities
(943)
(1,013)
Net cash outflow from financing activities
(1,276)
(1,558)
Net cash inflow/(outflow)
66
(6)
Cash and cash equivalents brought forward
1,075
1,097
Exchange loss on cash and cash equivalents
(89)
(16)
Cash and cash equivalents
1,052
1,075
Note:
1. From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. All comparatives for these segments have been re-presented on the new basis of
segmental reporting.
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Other information
Notes to the consolidated financial statements (continued)
32. Subsidiaries exempt from audit
The following UK subsidiaries will take advantage of the audit exemption set out within section 479A of the Companies Act
2006 for the year ended 31 March 2024.
Name
Registration
number
Name
Registration
number
Bluefish Communications Limited
5142610
Vodafone Consolidated Holdings Limited
5754561
Cable & Wireless Aspac Holdings Limited
4705342
Vodafone Corporate Secretaries Limited
2357692
Cable & Wireless CIS Services Limited
2964774
Vodafone Enterprise Corporate Secretaries Limited
2303594
Cable & Wireless Europe Holdings Limited
4659719
Vodafone Enterprise Equipment Limited
1648524
Cable & Wireless UK Holdings Limited
3840888
Vodafone Enterprise Europe (UK) Limited
3137479
Cable & Wireless Worldwide Limited
7029206
Vodafone European Investments
3961908
Cable & Wireless Worldwide Voice Messaging Limited
1981417
Vodafone Finance Management
2139168
Cable & Wireless Nominee Limited
3249884
Vodafone International Operations Limited
2797438
Central Communications Group Limited
4625248
Vodafone Investments Limited
1530514
Energis (Ireland) Limited
NI035793
Vodafone IP Licensing Limited
6846238
Energis Communications Limited
2630471
Vodafone Mobile Enterprises Limited
2373469
Energis Squared Limited
3037442
Vodafone Mobile Network Limited
3961482
London Hydraulic Power Company (The)
ZC000055
Vodafone Nominees Limited
1172051
MetroHoldings Limited
3511122
Vodafone Oceania Limited
3973427
The Eastern Leasing Company Limited
1672832
Vodafone Overseas Finance Limited
4171115
Thus Group Holdings Limited
SC192666
Vodafone Retail (Holdings) Limited
3381659
Thus Group Limited
SC226738
Vodafone UK Limited
2227940
Vodafone 2.
4083193
Vodaphone Limited
3961390
Your Communications Group Limited
4171876
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Other information
Company statement of financial position of Vodafone Group Plc
at 31 March
2024
2023
Note
€m
€m
Fixed assets
Shares in Group undertakings
2
83,470
83,427
Current assets
Debtors: amounts falling due after more than one year
3
4,025
5,651
Debtors: amounts falling due within one year
3
65,702
227,993
Other investments
4
766
260
Cash at bank and in hand
153
265
70,646
234,169
Creditors: amounts falling due within one year
5
(67,872)
(226,034)
Net current assets
2,774
8,135
Total assets less current liabilities
86,244
91,562
Creditors: amounts falling due after more than one year
5
(41,227)
(41,408)
45,017
50,154
Capital and reserves
Called up share capital
6
4,797
4,797
Share premium account
20,385
20,385
Capital redemption reserve
111
111
Other reserves
1,153
1,110
Own shares held
(7,780)
(7,854)
Profit and loss account1
26,351
31,605
Total equity shareholders’ funds
45,017
50,154
Note:
1 The loss for the financial year dealt with in the financial statements of the Company is €1,098 million (2023: €5,271 million profit).
The Company financial statements on pages 227 to 234 were approved by the Board of Directors and authorised for issue on 14 May 2024 and were
signed on its behalf by:
Margherita Della Valle
Luka Mucic
Group Chief Executive
Group Chief Financial Officer
The accompanying notes are an integral part of these financial statements.
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Company statement of changes in equity of Vodafone Group Plc
for the years ended 31 March
Called up share
capital
Share
premium
account1
Capital
redemption
reserve1 Other reserves1
Treasury
shares2
Profit and loss
account3
Total equity
shareholders’
funds
€m
€m
€m
€m
€m
€m
€m
1 April 2022
4,797
20,384
111
1,088
(7,413)
27,740
46,707
Issue or re-issue of shares
–
1
–
–
122
–
123
Profit for the financial year
–
–
–
–
–
5,271
5,271
Dividends
–
–
–
–
–
(2,502)
(2,502)
Capital contribution given relating to share-based payments
–
–
–
135
–
–
135
Contribution received relating to share-based payments
–
–
–
(113)
–
–
(113)
Repurchase of treasury shares4
–
–
–
–
(563)
–
(563)
Other movements5
–
–
–
–
–
1,096
1,096
31 March 2023
4,797
20,385
111
1,110
(7,854)
31,605
50,154
Issue or re-issue of shares
–
–
–
–
74
–
74
Loss for the financial year
–
–
–
–
–
(1,098)
(1,098)
Dividends
–
–
–
–
–
(2,433)
(2,433)
Capital contribution given relating to share-based payments
–
–
–
115
–
–
115
Contribution received relating to share-based payments
–
–
–
(72)
–
–
(72)
Other movements5
–
–
–
–
–
(1,723)
(1,723)
31 March 2024
4,797
20,385
111
1,153
(7,780)
26,351
45,017
Notes:
1 These reserves are not distributable.
2 Own shares relate to treasury shares which are purchased out of distributable profits and therefore reduce reserves available for distribution.
3 The Company has determined what amounts within this reserve are distributable and non-distributable in accordance with the guidance provided by ICAEW TECH 02/17BL and the requirements of
UK law. In accordance with UK Companies Act 2006 s831(2), a public company may make a distribution only if, after giving effect to such distribution, the amount of its net assets is not less than the
aggregate of its’ called up share capital and non-distributable reserves.
4 Represents the irrevocable and non-discretionary share buyback programmes which completed on 15 March 2023.
5 Includes the impact of the Company’s cash flow hedges with €2,051 million net loss deferred to other comprehensive income during the year (2023: €2,356 million net gain), €247 million net gain
(2023: €895 million net gain) recycled to the income statement, and a tax credit of €575 million (2023: tax charge of €365 million). These hedges primarily relate to foreign exchange exposure on
fixed borrowings, with any foreign exchange on nominal balances directly impacting income statement in each period but interest cash flows unwinding to the income statement over the life of the
hedges (up to 2063). See note 22 ‘Capital and financial risk management’ to the consolidated financial statements for further details.
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Notes to the Company financial statements
1. Basis of preparation
The separate financial statements of the Company are drawn up in accordance with the Companies Act 2006 and Financial Reporting Standard 101
‘Reduced disclosure framework’, (‘FRS 101’). The Company will continue to prepare its financial statements in accordance with FRS 101 on an
ongoing basis until such time as it notifies shareholders of any change to its chosen accounting framework.
The Company financial statements have been prepared using the historical cost convention, as modified by the revaluation of certain financial assets and
financial liabilities and in accordance with the UK Companies Act 2006. The financial statements have been prepared on a going concern basis.
The following exemptions available under FRS 101 have been applied:
− Paragraphs 45(b) and 46 to 52 of IFRS 2, ‘Shared-based payment’ (details of the number and weighted-average exercise prices of share options,
and how the fair value of goods or services received was determined);
− IFRS 7 ‘Financial Instruments: Disclosures’;
− Paragraph 91 to 99 of IFRS 13, ‘Fair value measurement’ (disclosure of valuation techniques and inputs used for fair value measurement of assets
and liabilities);
− Paragraph 38 of IAS 1 ‘Presentation of financial statements’ comparative information requirements in respect of paragraph 79(a)(iv) of IAS 1;
− The following paragraphs of IAS 1 ‘Presentation of financial statements’:
− 10(d) (statement of cash flows);
− 16 (statement of compliance with all IFRS);
− 38A (requirement for minimum of two primary statements, including cash flow statements);
− 38B-D (additional comparative information);
− 40A-D (requirements for a third statement of financial position);
− 111 (cash flow statement information); and
− 134-136 (capital management disclosures).
− IAS 7 ‘Statement of cash flows’;
− Paragraph 30 and 31 of IAS 8 ‘Accounting policies, changes in accounting estimates and errors’ (requirement for the disclosure of information
when an entity has not applied a new IFRS that has been issued but is not yet effective);
− The requirements in IAS 24 ‘Related party disclosures’ to disclose related party transactions entered into between two or more members of a
group;
− The requirements in IAS 36 ‘Impairment of asset’ to disclose valuation technique and assumptions used in determining recoverable amount.
As permitted by section 408(3) of the Companies Act 2006, the income statement of the Company is not presented in this Annual Report.
These separate financial statements are not intended to give a true and fair view of the profit or loss or cash flows of the Company. The Company
has not published its individual cash flow statement as its liquidity, solvency and financial adaptability are dependent on the Group rather than its
own cash flows.
Critical accounting judgements and key sources of estimation uncertainty
The preparation of Company financial statements in conformity with FRS 101 requires management to make estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the Company financial statements and
the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. The estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is
revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.
Management regularly reviews the accounting judgements and critical estimates that could potentially significantly impact the amounts
recognised in the financial statements and give rise to material adjustments in the Company’s financial statements.
A source of estimation uncertainty for the Company relates to the review for impairment of investment carrying values and the estimates used
when determining the recoverable value of the investment. However, there is not considered to be a significant risk of material adjustment from
revisions to these assumptions within the next financial year (see note 2 ‘Fixed assets’).
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Notes to the Company financial statements (continued)
1. Basis of preparation (continued)
Significant accounting policies applied in the current reporting period that relate to the financial statements as a whole
Foreign currencies
Transactions in foreign currencies are initially recorded at the functional rate of currency prevailing on the date of the transaction. Monetary assets
and liabilities denominated in foreign currencies are retranslated into the Company’s functional currency at the rates prevailing on the reporting
period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial
transaction dates. Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated. Exchange differences arising
on the settlement of monetary items, and on the retranslation of monetary items, are included in the income statement for the period. Exchange
differences arising on the retranslation of non-monetary items carried at fair value are included in the income statement for the period.
Borrowing costs
All borrowing costs are recognised in the income statement in the period in which they are incurred.
Taxation
Current tax, including UK corporation tax and foreign tax, is provided at amounts expected to be paid (or recovered) using the tax rates and laws
that have been enacted or substantively enacted by the reporting period date.
Deferred tax is provided in full on temporary differences that exist at the reporting period date and that result in an obligation to pay more tax, or a
right to pay less tax in the future. The deferred tax is measured at the rate expected to apply in the periods in which the temporary differences are
expected to reverse, based on the tax rates and laws that are enacted or substantively enacted at the reporting period date. Temporary differences
arise from the inclusion of items of income and expenditure in taxation computations in periods different from those in which they are included in
the Company financial statements. Deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be
recovered. Deferred tax assets and liabilities are not discounted.
Financial instruments
Financial assets and financial liabilities, in respect of financial instruments, are recognised on the Company statement of financial position when the
Company becomes a party to the contractual provisions of the instrument.
Financial liabilities and equity instruments
Financial liabilities and equity instruments issued by the Company are classified according to the substance of the contractual arrangements
entered into and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that evidences a residual
interest in the assets of the Company after deducting all of its liabilities and includes no obligation to deliver cash or other financial assets. The
accounting policies adopted for specific financial liabilities and equity instruments are set out below.
Derivative financial instruments and hedge accounting
The Company’s activities expose it to the financial risks of changes in foreign exchange rates and interest rates which it manages using derivative
financial instruments.
The use of derivative financial instruments is governed by the Group’s policies approved by the Board of Directors, which provide written principles
on the use of derivative financial instruments consistent with the Group’s risk management strategy. Changes in values of all derivative financial
instruments are included within the income statement unless designated in an effective cash flow hedge relationship when changes in value are
deferred to other comprehensive income or equity respectively. The Company does not use derivative financial instruments for speculative
purposes.
Derivative financial instruments are initially measured at fair value on the contract date and are subsequently remeasured to fair value at each
reporting date. The Company designates certain derivatives as hedges of the change of fair value of recognised assets and liabilities (‘fair value
hedges’) or hedges of highly probable forecast transactions or hedges of foreign currency or interest rate risks of firm commitments (‘cash flow
hedges’). Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, exercised or no longer qualifies for hedge
accounting.
Fair value hedges
The Company’s policy is to use derivative financial instruments (primarily interest rate swaps) to convert a proportion of its fixed rate debt to floating
rates in order to hedge the interest rate risk arising, principally, from capital market borrowings. The Company designates these as fair value hedges
of interest rate risk with changes in fair value of the hedging instrument recognised in the income statement for the period together with the
changes in the fair value of the hedged item due to the hedged risk, to the extent the hedge is effective. Gains and losses relating to any ineffective
portion are recognised immediately in the income statement.
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Cash flow hedges
Cash flow hedging is used by the Company to hedge certain exposures to variability in future cash flows. The portion of gains or losses relating to
changes in the fair value of derivatives that are designated and qualify as effective cash flow hedges is recognised in other comprehensive income;
gains or losses relating to any ineffective portion are recognised immediately in the income statement. However, when the hedged transaction
results in the recognition of a non-financial asset or a non-financial liability, the gains and losses previously recognised in other comprehensive
income and accumulated in equity are transferred from equity and included in the initial measurement of the cost of the non-financial asset or non-
financial liability. When the hedged item is recognised in the income statement, amounts previously recognised in other comprehensive income
and accumulated in equity for the hedging instrument are reclassified to the income statement. When hedge accounting is discontinued, any gain
or loss recognised in other comprehensive income at that time remains in equity and is recognised in the income statement when the hedged
transaction is ultimately recognised in the income statement. If a forecast transaction is no longer expected to occur, the gain or loss accumulated
in equity is recognised immediately in the income statement.
New accounting pronouncements
To the extent applicable the Company will adopt new accounting policies as set out in note 1 ‘Basis of preparation’ in the consolidated financial statements.
2. Fixed assets
Accounting policies
Shares in Group undertakings are stated at cost less any provision for impairment and capital related to share-based payments. Contributions in
respect of share-based payments are recognised in line with the policy set out in note 7 ‘Share-based payments’.
The Company assesses investments for impairment whenever events or changes in circumstances indicate that the carrying value of an investment
may not be recoverable. If any such indication of impairment exists, the Company makes an estimate of the recoverable amount. If the recoverable
amount of the cash-generating unit is less than the value of the investment, the investment is considered to be impaired and is written down to its
recoverable amount. An impairment loss is recognised immediately in the income statement.
Where there has been a change in the estimates used to determine recoverable amount and an impairment loss subsequently reverses, the carrying
amount of the cash-generating unit is increased to the revised estimate of its recoverable amount, not to exceed the carrying amount that would
have been determined had no impairment loss been recognised for the cash-generating unit in prior years and an impairment loss reversal is
recognised immediately in the income statement.
The Company applies the same methodology and assumptions used by the Group for goodwill impairment testing purposes, as set out in note 4
‘Impairment losses’ to the consolidated financial statements. For the purposes of the Company’s own impairment assessment, the Group’s
operations are considered to be a single cash generating unit (‘CGU’) held within the Company’s principal subsidiary, Vodafone European
Investments. The pooling of the Company’s interests within a single CGU significantly reduces the risk that movements in individual assumptions
used during the goodwill impairment testing will impact the result of the investment impairment assessment. Whilst the underlying assumptions
used are a source of estimation uncertainty, they do not give rise to a significant risk of adjustment within the next financial year.
Shares in Group undertakings
2024
2023
€m
€m
Cost
1 April
84,471
84,334
Additions
–
782
Disposals
(261)
(667)
Capital contributions arising from share-based payments
115
135
Contributions received in relation to share-based payments
(72)
(113)
31 March
84,253
84,471
Accumulated impairment losses
1 April
1,044
928
Disposals
(261)
–
Impairment loss recognised1
–
116
31 March
783
1,044
Net book value
31 March
83,470
83,427
Note:
1. €116 million of capital contribution and resulting impairment related to an intercompany reorganisation exercise completed during the prior year.
At 31 March 2024 the Company had the following principal subsidiary:
Name
Principal activity
Country of incorporation
Percentage shareholding
Vodafone European Investments
Holding Company
England
100
Details of direct and indirect related undertakings are set out in note 31 ‘Related undertakings’ to the consolidated financial statements.
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Notes to the Company financial statements (continued)
3. Debtors
Accounting policies
Amounts owed by subsidiaries are classified and recorded at amortised cost and reduced by allowances for expected credit losses. Estimated future
credit losses are first recorded on initial recognition of a receivable and are based on estimated probability of default. Individual balances are written
off when management deems them not to be collectible. Derivative financial instruments are measured at fair value through profit and loss.
2024
2023
€m
€m
Amounts falling due within one year
Amounts owed by subsidiaries1
65,272
227,347
Taxation recoverable2
185
111
Other debtors
4
4
Derivative financial instruments
241
531
65,702
227,993
Amounts falling due after more than one year
Deferred tax
5
–
Other debtors
8
4
Derivative financial instruments
4,012
5,647
4,025
5,651
Notes:
1. Amounts owned by subsidiaries are unsecured, have no fixed date of repayment and are repayable on demand with sufficient liquidity in the Group to flow funds if required. The expected credit
losses are considered to be immaterial. Balance was significantly reduced following the settlement of amounts owed to and from subsidiaries after completing an intercompany reorganisation
exercise.
2. Primarily relates to amounts owed by Group companies due to Group relief.
4. Other Investments
Accounting policies
Investments are classified and measured at amortised cost using the effective interest rate method, less any impairment.
2024
2023
€m
€m
Collateral
766
260
5. Creditors
Accounting policies
Capital market and bank borrowings
Interest-bearing loans and overdrafts are initially measured at fair value (which is equal to cost at inception) and are subsequently measured at
amortised cost using the effective interest rate method, except where they are identified as a hedged item in a designated fair value hedge
relationship. Any difference between the proceeds net of transaction costs and the amount due on settlement or redemption of borrowings is
recognised over the term of the borrowing.
2024
2023
€m
€m
Amounts falling due within one year
Bonds
1,292
4,604
Collateral liabilities
2,622
4,886
Other borrowings
26
6
Bank borrowings secured against Indian assets
1,720
1,485
Amounts owed to subsidiaries1
62,153
214,893
Derivative financial instruments
56
155
Accruals and deferred income
3
5
67,872
226,034
Amounts falling due after more than one year
Deferred tax
128
703
Bonds
37,655
37,719
Bank loans
2
2
Amounts owed to subsidiaries2
1,796
1,793
Derivative financial instruments
1,646
1,191
41,227
41,408
Notes:
1 Amounts owed to subsidiaries are unsecured, have no fixed date of repayment are repayable on demand. Balance was significantly reduced following the settlement of amounts owed to and
from subsidiaries after completing an intercompany reorganisation exercise.
2 Amounts payable with a fixed interest rate range of 3.25% and 4% and maturity ranging from 2029 to 2043.
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Included in amounts falling due after more than one year are bonds of €37,655 million (2023: €37,719 million) which are due in more than five
years from 31 March 2024 and are payable otherwise than by instalments. Interest payable on these bonds ranges from 0.375% to 8.0% (2023:
0.375% to 7.875%).
6. Called up share capital
Accounting policies
Equity instruments issued by the Company are recorded at the amount of the proceeds received, net of direct issuance costs.
2024
2023
Number
€m
Number
€m
Ordinary shares of 20 20⁄21 US cents each allotted,
issued and fully paid:1,2
1 April
28,818,256,058
4,797
28,817,627,868
4,797
Allotted during the year
427,750
–
628,190
–
31 March
28,818,683,808
4,797
28,818,256,058
4,797
Notes:
1 At 31 March 2024, there were 50,000 (2023: 50,000) 7% cumulative fixed rate shares of £1 each in issue.
2 At 31 March 2024, the Group held 1,738,561,954 (2023: 1,825,691,429) treasury shares with a nominal value of €289 million (2023: €304 million). The market value of shares held was
€1,434 million (2023: €1,855 million). During the year, 87,129,475 (2023: 85,844,124) treasury shares were reissued under Group share schemes and no (2023: 1,463,959,031) shares were
repurchased under the 2022 scheme which completed on 15 March 2023.
On 15 March 2024, the Group announced that the Board has approved the capital return through share buybacks of up to €2 billion of proceeds
from the sale of Vodafone Spain. This is expected to commence following the completion of the sale of Vodafone Spain.
7. Share-based payments
Accounting policies
The Group operates a number of equity-settled share-based payment plans for the employees of subsidiaries using the Company’s equity
instruments. The fair value of the compensation given in respect of these share-based payment plans is recognised as a capital contribution to the
Company’s subsidiaries over the vesting period. The capital contribution is reduced by any payments received from subsidiaries in respect of these
share-based payments.
The Company currently uses a number of equity-settled share plans to grant options and shares to the Directors and employees of its subsidiaries.
At 31 March 2024 the Company had 70 million ordinary share options outstanding (2023: 62 million).
The Company has made capital contributions to its subsidiaries in relation to share-based payments. At 31 March 2024, the cumulative capital
contribution net of payments received from subsidiaries was €304 million (2023: €261 million). During the year ended 31 March 2024, the total
capital contribution arising from share-based payments was €115 million (2023: €135 million), with payments of €72 million (2023: €113 million)
received from subsidiaries.
Full details of share-based payments, share option schemes and share plans are disclosed in note 26 ‘Share-based payments’ to the consolidated
financial statements.
8. Reserves
The Board is responsible for the Group’s capital management including the approval of dividends. This includes an assessment of both the level of
reserves legally available for distribution and consideration as to whether the Company would be solvent and retain sufficient liquidity following any
proposed distribution.
As Vodafone Group Plc is a Group holding company with no direct operations, its ability to make shareholder distributions is dependent on its ability
to receive funds for such purposes from its subsidiaries in a manner which creates profits available for distribution for the Company. The major
factors that impact the ability of the Company to access profits held in subsidiary companies at an appropriate level to fulfil its needs for
distributable reserves on an ongoing basis include:
− the absolute size of the profit pools either currently available for distribution or capable of realisation into distributable reserves in the relevant
entities;
− the location of these entities in the Group’s corporate structure;
− profit and cash flow generation in those entities; and
− the risk of adverse changes in business valuations giving rise to investment impairment charges, reducing profits available for distribution.
The Group’s consolidated reserves set out on page 137 do not reflect the profits available for distribution in the Group.
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Notes to the Company financial statements (continued)
9. Equity dividends
Accounting policies
Dividends paid and received are included in the Company financial statements in the period in which the related dividends are actually paid or
received or, in respect of the Company’s final dividend for the year, approved by shareholders.
2024
2023
€m
€m
Declared during the financial year
Final dividend for the year ended 31 March 2023: 4.50 eurocents per share
(2022: 4.50 eurocents per share)
1,215
1,265
Interim dividend for the year ended 31 March 2024: 4.50 eurocents per share
(2023: 4.50 eurocents per share)
1,218
1,237
2,433
2,502
Proposed after the balance sheet date and not recognised as a liability
Final dividend for the year ended 31 March 2024: 4.50 eurocents per share
(2023: 4.50 eurocents per share)
1,219
1,215
10. Guarantees, contingent liabilities and legal proceedings
2024
2023
€m
€m
Performance and payment bonds1
1,399
1,307
Guarantees2
1,566
1,661
Notes:
1 Performance and payment bonds represent letter of credit arrangements provided to other Group companies.
2 Principally comprises Vodafone Group Plc’s guarantee of the Group’s share in a multicurrency loan facility, amounting to US$1 billion and €0.6 billion (2023: US$1.75 billion), which forms
part of its overall joint venture investment in TPG Telecom Ltd (as detailed in note 22 ‘Capital and financial risk management’ to the consolidated financial statements).
As detailed in note 25 ‘Post employment benefits’ to the consolidated financial statements, the Company is the sponsor of the Group’s main
defined benefit scheme in the UK, being the Vodafone Group UK Pension Scheme (‘Vodafone UK plan’). The results, assets and liabilities associated
with the Vodafone UK plan are recognised in the financial statements of Vodafone Limited and Vodafone Group Services Limited.
As detailed in note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements, the Company has covenanted to
provide security in favour of the trustees of the Vodafone Group UK Pension Scheme and the trustees of THUS Plc Group Scheme
Additionally, as detailed in note 32 ‘Subsidiaries exempt from audit’ to the consolidated financial statements, the Company guarantees the debts
and liabilities of certain of its UK subsidiaries at the balance sheet date in accordance with section 479C of the Companies Act 2006.
Legal proceedings
Details regarding certain legal actions which involve the Company are set out in note 29 ‘Contingent liabilities and legal proceedings’ to the
consolidated financial statements.
11. Other matters
The auditor’s remuneration for the current year in respect of audit and audit-related services was €7 million (2023: €6 million1) and for non-audit
services was €10 million (2023: €1 million).
The Company had two (2023: two) employees from 1 September 2023 when Luka Mucic was appointed Group Chief Financial Officer. The executive
directors were remunerated by the Company for their services to the Group as a whole. No remuneration was paid to them specifically in respect of
their services to Vodafone Group Plc for either year. Full details of the Directors’ remuneration are disclosed in the ‘Annual Report on Remuneration’
on pages 106 to 118 and in Note 23 ‘Directors and key management compensation’.
Vodafone Group Plc is incorporated and domiciled in England and Wales (registration number 1833679). The registered address of the Company is
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, England.
Note:
1 Audit fees of the parent company for the year ended 31 March 2023 have increased by €1 million compared to the amount previously reported. This is to include fees agreed during the year
ended 31 March 2024 relating to the year ended 31 March 2023.
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Financials
Other information
Non-GAAP measures
Unaudited information
In the discussion of the Group’s reported operating results, non-GAAP measures are presented to provide readers with additional financial
information that is regularly reviewed by management. This additional information presented is not uniformly defined by all companies including
those in the Group’s industry. Accordingly, it may not be comparable with similarly titled measures and disclosures by other companies.
Additionally, certain information presented is derived from amounts calculated in accordance with IFRS but is not itself a measure defined under
GAAP. Such measures should not be viewed in isolation or as an alternative to the equivalent GAAP measure. The non-GAAP measures discussed in
this document are listed below.
Non-GAAP measure
Defined on page
Closest equivalent GAAP measure
Reconciled on page
Performance metrics
Adjusted EBITDAaL
Page 236
Operating profit
Page 149
Organic Adjusted EBITDAaL growth
Page 236
Not applicable
−
Organic revenue growth
Page 236
Revenue
Pages 237, 239 and 240
Organic Group service revenue growth
excluding Turkey
Page 236
Service revenue
Pages 237, 239 and 240
Organic Group Adjusted EBITDAaL growth
excluding Turkey
Page 236
Not applicable
−
Organic service revenue growth
Page 236
Service revenue
Pages 237, 239 and 240
Organic mobile service revenue growth
Page 236
Service revenue
Pages 237, 239 and 240
Organic fixed service revenue growth
Page 236
Service revenue
Pages 237, 239 and 240
Organic Vodafone Business (B2B) service
revenue growth (Group and Operating
segments)
Page 236
Service revenue
Pages 237, 239 and 240
Organic financial services revenue growth
in South Africa
Page 236
Service revenue
Pages 237, 239 and 240
Other metrics
Adjusted profit attributable to owners of
the parent
Page 241
Profit attributable to owners of the parent Page 241
Adjusted basic earnings per share
Page 241
Basic earnings per share
Page 242
Cash flow, funding and capital
allocation metrics
Free cash flow
Page 242
Inflow from operating activities
Page 243
Adjusted free cash flow
Page 242
Inflow from operating activities
Pages 29 and 243
Gross debt
Page 242
Borrowings
Page 243
Net debt
Page 242
Borrowings less cash and cash
equivalents
Page 243
Pre-tax ROCE (controlled)
Page 244
ROCE calculated using GAAP measures
Pages 244 and 245
Post-tax ROCE (controlled and
associates/joint ventures)
Page 244
ROCE calculated using GAAP measures
Pages 244 and 245
Financing and Taxation metrics
Adjusted net financing costs
Page 246
Net financing costs
Page 27
Adjusted profit before taxation
Page 246
Profit before taxation
Page 247
Adjusted income tax expense
Page 246
Income tax expense
Page 247
Adjusted effective tax rate
Page 246
Income tax expense
Page 247
Adjusted share of results of equity
accounted associates and joint ventures
Page 246
Share of results of equity accounted
associates and joint ventures
Page 247
Adjusted share of results of equity
accounted associates and joint ventures
used in post-tax ROCE
Page 246
Share of results of equity accounted
associates and joint ventures
Page 247
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Other information
Non-GAAP measures (continued)
Unaudited information
Performance metrics
Non-GAAP measure
Purpose
Definition
Adjusted EBITDAaL
Adjusted EBITDAaL is used in conjunction with
financial measures such as operating profit to assess
our operating performance and profitability.
Adjusted EBITDAaL is operating profit after
depreciation on lease-related right of use assets and
interest on lease liabilities but excluding depreciation,
amortisation and gains/losses on disposal of owned
assets and excluding share of results of equity
accounted associates and joint ventures, impairment
losses/reversals, restructuring costs arising from
discrete restructuring plans, other income and
expense and significant items that are not considered
by management to be reflective of the underlying
performance of the Group.
It is a key external metric used by the investor
community to assess performance of our operations.
It is our segment performance measure in accordance
with IFRS 8 (Operating Segments).
Adjusted EBITDAaL margin is Adjusted EBITDAaL divided by Revenue.
Organic growth
Organic growth presents performance on a comparable basis, excluding the impact of foreign exchange rates, mergers and acquisitions, the
hyperinflation adjustment in Turkey and other adjustments to improve the comparability of results between periods.
Organic growth is calculated for revenue and profitability metrics, as follows:
− Adjusted EBITDAaL;
− Revenue;
− Group service revenue excluding Turkey;
− Group Adjusted EBITDAaL excluding Turkey;
− Service revenue;
− Mobile service revenue;
− Fixed service revenue;
− Vodafone Business service revenue (Group and Operating segments); and
− Financial services revenue in South Africa.
Whilst organic growth is not intended to be a substitute for reported growth, nor is it superior to reported growth, we believe that the measure
provides useful and necessary information to investors and other interested parties for the following reasons:
− It provides additional information on underlying growth of the business without the effect of certain factors unrelated to its operating
performance;
− It is used for internal performance analysis; and
− It facilitates comparability of underlying growth with other companies (although the term ‘organic’ is not a defined term under GAAP and may not,
therefore, be comparable with similarly-titled measures reported by other companies).
We have not provided a comparative in respect of organic growth rates as the current rates describe the change between the beginning and end of
the current period, with such changes being explained by the commentary in this document. If comparatives were provided, significant sections of
the commentary for prior periods would also need to be included, reducing the usefulness and transparency of this document.
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Re-presented1
Reported
M&A and
Foreign
Organic
FY24
FY23
growth
Other
exchange
growth*
€m
€m
%
pps
pps
%
Year ended 31 March 2024
Service revenue
Germany
11,453
11,433
0.2
–
–
0.2
Mobile service revenue
5,059
5,060
-
–
–
-
Fixed service revenue
6,394
6,373
0.3
–
–
0.3
UK
5,631
5,358
5.1
–
(0.1)
5.0
Mobile service revenue
4,142
3,928
5.4
–
-
5.4
Fixed service revenue
1,489
1,430
4.1
–
(0.2)
3.9
Other Europe2
4,722
5,005
(5.7)
10.6
(0.7)
4.2
Turkey3
1,746
1,593
9.6
10.7
68.2
88.5
Africa4
5,951
6,556
(9.2)
–
18.4
9.2
Common Functions
559
530
Eliminations
(150)
(157)
Total service revenue
29,912
30,318
(1.3)
1.9
5.7
6.3
Other revenue
6,805
7,354
Revenue
36,717
37,672
(2.5)
2.8
5.6
5.9
Other growth metrics
Group service revenue excluding Turkey
28,197
28,912
(2.5)
2.4
3.8
3.7
Group Adjusted EBITDAaL excluding Turkey
10,509
12,023
(12.6)
8.3
3.7
(0.6)
Turkey - Service revenue
1,746
1,440
21.3
(14.7)
81.9
88.5
Turkey - Adjusted EBITDAaL
510
401
27.2
(12.8)
85.5
99.9
Vodafone Business - Service revenue
7,735
7,757
(0.3)
1.8
3.5
5.0
Germany - Vodafone Business service revenue
2,422
2,421
–
–
–
–
UK - Vodafone Business service revenue
2,144
2,075
3.3
–
(0.1)
3.2
Other Europe - Vodafone Business service revenue
1,502
1,496
0.4
8.1
(0.6)
7.9
Turkey - Vodafone Business service revenue
233
194
20.1
(14.4)
81.7
87.4
South Africa - Financial services revenue
157
167
(6.0)
–
13.9
7.9
M-Pesa revenue
389
367
6.0
–
7.4
13.4
Notes:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 The comparative period includes the results of Vodafone Hungary which, as previously reported, was sold in January 2023.
3 The comparative period includes the results of Vodafone Ghana which, as previously reported, was sold in February 2023.
4 From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. The comparatives have been re-presented on the new basis of segmental
reporting. There is no impact on previously reported Group metrics.
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Other information
Non-GAAP measures (continued)
Unaudited information
Re-presented1
Reported
M&A and
Foreign
Organic
FY24
FY23
growth
Other
exchange
growth*
€m
€m
%
pps
pps
%
Year ended 31 March 2024
Adjusted EBITDAaL
Germany
5,017
5,323
(5.8)
–
–
(5.8)
UK
1,408
1,350
4.3
-
(0.3)
4.0
Other Europe2
1,516
1,632
(7.1)
9.4
(0.8)
1.5
Turkey3
510
424
20.3
3.0
76.6
99.9
Africa4
2,539
2,880
(11.8)
-
18.2
6.4
Vantage Towers
–
795
Common Functions
29
20
Eliminations
–
–
Group
11,019
12,424
(11.3)
8.6
4.9
2.2
Percentage point change in Adjusted EBITDAaL margin
Germany
38.7%
40.6%
(1.9)
–
–
(1.9)
UK
20.6%
19.8%
0.8
-
-
0.8
Other Europe2
27.5%
28.4%
(0.9)
(0.5)
-
(1.4)
Turkey3
21.6%
20.5%
1.1
(0.2)
0.1
1.0
Africa4
34.2%
35.7%
(1.5)
-
0.4
(1.1)
Group
30.0%
33.0%
(3.0)
2.0
(0.1)
(1.1)
Notes:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 The comparative period includes the results of Vodafone Hungary which, as previously reported, was sold in January 2023.
3 The comparative period includes the results of Vodafone Ghana which, as previously reported, was sold in February 2023.
4 From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. The comparatives have been re-presented on the new basis of segmental
reporting. There is no impact on previously reported Group metrics.
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Other information
Re-presented1
Reported
M&A and
Foreign
Organic
Q4 FY24
Q4 FY23
growth
Other
exchange
growth*
€m
€m
%
pps
pps
%
Quarter ended 31 March 2024
Service revenue
Germany
2,839
2,821
0.6
–
–
0.6
Mobile service revenue
1,257
1,235
1.8
–
–
1.8
Fixed service revenue
1,582
1,586
(0.3)
0.1
–
(0.2)
UK
1,409
1,319
6.8
–
(3.2)
3.6
Mobile service revenue
1,012
948
6.8
–
(3.1)
3.7
Fixed service revenue
397
371
7.0
–
(3.5)
3.5
Other Europe2
1,181
1,178
0.3
4.8
0.4
5.5
Turkey3
525
454
15.6
1.1
88.9
105.6
Africa4
1,484
1,466
1.2
-
8.8
10.0
Common Functions
140
128
Eliminations
(32)
(31)
Total service revenue
7,546
7,335
2.9
0.2
4.0
7.1
Other revenue
1,842
1,793
Revenue
9,388
9,128
2.8
1.2
4.3
8.3
Other growth metrics
Group service revenue excluding Turkey
7,027
6,913
1.6
1.1
1.3
4.0
Turkey - Service revenue
525
430
22.1
(18.2)
101.7
105.6
Vodafone Business - Service revenue
1,979
1,918
3.2
0.4
1.8
5.4
Germany - Vodafone Business service revenue
605
599
1.0
-
-
1.0
UK - Vodafone Business service revenue
545
531
2.6
-
(3.1)
(0.5)
Other Europe - Vodafone Business service revenue
399
369
8.1
3.5
0.6
12.2
Turkey - Vodafone Business service revenue
71
59
20.3
(17.9)
99.8
102.2
Notes:
1 The results for the quarter ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See
note 7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 The comparative period includes the results of Vodafone Hungary which, as previously reported, was sold in January 2023.
3 The comparative period includes the results of Vodafone Ghana which, as previously reported, was sold in February 2023.
4 From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. The comparatives have been re-presented on the new basis of segmental
reporting. There is no impact on previously reported Group metrics.
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Financials
Other information
Non-GAAP measures (continued)
Unaudited information
Re-presented1
Reported
M&A and
Foreign
Organic
Q3 FY24
Q3 FY23
growth
Other
exchange
growth*
€m
€m
%
pps
pps
%
Quarter ended 31 December 2023
Service revenue
Germany
2,892
2,882
0.3
–
–
0.3
Mobile service revenue
1,272
1,279
(0.5)
–
–
(0.5)
Fixed service revenue
1,620
1,603
1.1
(0.1)
–
1.0
UK
1,400
1,327
5.5
–
(0.3)
5.2
Mobile service revenue
1,034
977
5.8
–
(0.4)
5.4
Fixed service revenue
366
350
4.6
–
–
4.6
Other Europe2
1,175
1,275
(7.8)
12.4
(1.0)
3.6
Turkey3
393
368
6.8
19.5
64.1
90.4
Africa4
1,543
1,668
(7.5)
–
16.3
8.8
Common Functions
137
134
Eliminations
(35)
(37)
Total service revenue
7,505
7,617
(1.5)
2.5
5.3
6.3
Other revenue
1,841
1,978
Revenue
9,346
9,595
(2.6)
3.3
5.2
5.9
Other growth metrics
Group service revenue excluding Turkey
7,119
7,290
(2.3)
2.7
3.2
3.6
Turkey - Service revenue
393
334
17.7
(10.7)
83.4
90.4
Vodafone Business - Service revenue
1,943
1,954
(0.6)
2.5
3.1
5.0
Germany - Vodafone Business service revenue
612
629
(2.7)
0.8
–
(1.9)
UK - Vodafone Business service revenue
540
508
6.3
–
(0.5)
5.8
Other Europe - Vodafone Business service revenue
375
380
(1.3)
9.7
(0.6)
7.8
Turkey - Vodafone Business service revenue
53
44
20.5
(34.4)
108.6
94.7
Notes:
1 The results for the quarter ended 31 December 2022 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations.
See note 7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 The comparative period includes the results of Vodafone Hungary which, as previously reported, was sold in January 2023.
3 The comparative period includes the results of Vodafone Ghana which, as previously reported, was sold in February 2023.
4 From 1 April 2023, the Group revised its segmental reporting by moving Vodafone Egypt to the Africa segment. The comparatives have been re-presented on the new basis of segmental
reporting. There is no impact on previously reported Group metrics.
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Other information
Other metrics
Non-GAAP measure
Purpose
Definition
Adjusted profit attributable
to owners of the parent
This metric is used in the calculation of Adjusted basic
earnings per share.
Adjusted profit attributable to owners of the parent
excludes restructuring costs arising from discrete
restructuring plans, amortisation of customer bases
and brand intangible assets, impairment
losses/reversals, other income and expense and mark-
to-market and foreign exchange movements, together
with related tax effects.
Adjusted basic earnings per
share
This performance measure is used in discussions with
the investor community.
Adjusted basic earnings per share is Adjusted profit
attributable to owners of the parent divided by the
weighted average number of shares outstanding. This
is the same denominator used when calculating basic
earnings per share.
Adjusted EBITDAaL and Adjusted profit attributable to owners of the parent
The table below reconciles Adjusted EBITDAaL and Adjusted profit attributable to owners of the parent to their closest equivalent GAAP measures,
being Operating profit and Profit attributable to owners of the parent, respectively.
FY24
FY23 Re-presented1
Reported
Adjustments
Adjusted
Reported
Adjustments
Adjusted
€m
€m
€m
€m
€m
€m
Adjusted EBITDAaL
11,019
–
11,019
12,424
–
12,424
Restructuring costs
(703)
703
–
(538)
538
–
Interest on lease liabilities
440
–
440
355
–
355
Loss on disposal of property, plant & equipment and
intangible assets
(34)
–
(34)
(41)
–
(41)
Depreciation and amortisation on owned assets2
(7,397)
606
(6,791)
(7,520)
555
(6,965)
Share of results of equity accounted associates and
joint ventures3
(96)
323
227
433
220
653
Impairment reversal/(loss)
64
(64)
–
(64)
64
–
Other income
372
(372)
–
9,402
(9,402)
–
Operating profit
3,665
1,196
4,861
14,451
(8,025)
6,426
Investment income
581
–
581
232
–
232
Financing costs4
(2,626)
270
(2,356)
(1,609)
(399)
(2,008)
Profit before taxation
1,620
1,466
3,086
13,074
(8,424)
4,650
Income tax expense5
(50)
(650)
(700)
(492)
(532)
(1,024)
Profit for the financial year from continuing
operations
1,570
816
2,386
12,582
(8,956)
3,626
Loss for the financial year from discontinued
operations
(65)
65
–
(247)
247
–
Profit for the financial year
1,505
881
2,386
12,335
(8,709)
3,626
Profit attributable to:
- Owners of the parent (Continuing)
1,205
816
2,021
12,085
(8,962)
3,123
- Owners of the parent (Total Group)
1,140
881
2,021
11,838
(8,715)
3,123
- Non-controlling interests
365
–
365
497
6
503
Profit for the financial year
1,505
881
2,386
12,335
(8,709)
3,626
Notes:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 Depreciation and amortisation on owned assets excludes depreciation on leased assets and loss on disposal of leased assets included within Adjusted EBITDAaL. See page 248 for an analysis
of depreciation and amortisation. The adjustment of €606 million (FY23: €555 million) relates to amortisation of customer bases and brand intangible assets.
3 See page 247 for a breakdown of the adjustments to Share of results of equity accounted associates and joint ventures to derive Adjusted share of results of equity accounted associates and
joint ventures.
4 See ‘Net financing costs’ on page 27 for further analysis.
5 See ‘Adjusted tax metrics’ on page 247 for further analysis.
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Financials
Other information
Non-GAAP measures (continued)
Unaudited information
Adjusted basic earnings per share
The reconciliation of Adjusted basic earnings per share to the closest equivalent GAAP measure, basic earnings per share, is provided below.
Re-presented1
FY24
FY23
€m
€m
Profit attributable to owners of the parent
1,140
11,838
Adjusted profit attributable to owners of the parent
2,021
3,123
Million
Million
Weighted average number of shares outstanding - Basic
27,056
27,680
eurocents
eurocents
Basic earnings per share
4.21c
42.77c
Adjusted basic earnings per share
7.47c
11.28c
Note:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
Cash flow, funding and capital allocation metrics
Cash flow and funding
Non-GAAP measure
Purpose
Definition
Free cash flow
Internal performance reporting.
Free cash flow is Adjusted EBITDAaL after cash flows in
relation to capital additions, working capital
movements including in respect of capital additions,
disposal of property, plant and equipment and
intangible assets, integration capital additions and
restructuring costs, together with related working
capital, licences and spectrum, interest received and
paid, taxation, dividends received from associates and
joint ventures, dividends paid to non-controlling
shareholders in subsidiaries, payments in respect of
lease liabilities and other.
External metric used by investor community.
Assists comparability with other companies, although
our metric may not be directly comparable to
similarly titled measures used by other companies.
Adjusted free cash flow
Internal performance reporting.
Adjusted free cash flow is Free cash flow before
licences and spectrum, restructuring costs arising from
discrete restructuring plans, integration capital
additions and working capital related items, M&A and
(prior to disposal) Vantage Towers growth capital
expenditure.
Growth capital expenditure is total capital expenditure
excluding maintenance-type expenditure.
External metric used by investor community.
Setting director and management remuneration.
Key external metric used to evaluate liquidity and the
cash generated by our operations.
Gross debt
Prominent metric used by debt rating agencies and
the investor community.
Non-current borrowings and current borrowings,
excluding lease liabilities, collateral liabilities and
borrowings specifically secured against Indian assets.
Net debt
Prominent metric used by debt rating agencies and
the investor community.
Gross debt less cash and cash equivalents, short-term
investments, derivative financial instruments
excluding mark-to-market adjustments and net
collateral assets.
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Other information
Cash flow and funding (continued)
The table below presents the reconciliation between Inflow from operating activities and Free cash flow.
Re-presented1
FY24
FY23
€m
€m
Inflow from operating activities
16,557
18,054
Net tax paid
724
1,228
Cashflows from discontinued operations
(3,296)
(3,464)
Cash generated by operations
13,985
15,818
Capital additions
(6,331)
(7,067)
Working capital movement in respect of capital additions
(141)
(120)
Disposal of property, plant and equipment and intangible assets
14
90
Integration capital additions
(81)
(200)
Working capital movement in respect of integration capital additions
(37)
(5)
Licences and spectrum
(454)
(773)
Interest received and paid2
(1,685)
(1,468)
Taxation
(724)
(1,228)
Dividends received from associates and joint ventures
442
617
Dividends paid to non-controlling shareholders in subsidiaries
(260)
(400)
Payments in respect of lease liabilities
(3,135)
(2,747)
Other
190
66
Free cash flow
1,783
2,583
Notes:
1. The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued
operations. See note 7 'Discontinued operations and assets held for sale' in the consolidated financial statements for more information.
2. Includes interest on lease liabilities of €406 million (FY23: €296 million), excluding discontinued operations.
The table below presents the reconciliation between Borrowings, Gross debt and Net debt.
Year-end FY24
Year-end FY23
€m
€m
Borrowings
(56,987)
(66,390)
Lease liabilities
9,672
13,364
Bank borrowings secured against Indian assets
1,720
1,485
Collateral liabilities
2,628
4,886
Gross debt
(42,967)
(46,655)
Collateral liabilities
(2,628)
(4,886)
Cash and cash equivalents
6,183
11,705
Short-term investments
3,225
4,305
Collateral assets
741
239
Derivative financial instruments
2,702
4,702
Less mark-to-market gains deferred in hedge reserves
(498)
(2,785)
Net debt
(33,242)
(33,375)
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Other information
Non-GAAP measures (continued)
Unaudited information
Return on Capital Employed
Non-GAAP measure
Purpose
Definition
Return on Capital
Employed ('ROCE')
ROCE is a metric used by the investor community and
reflects how efficiently we are generating profit with
the capital we deploy.
We calculate ROCE by dividing Operating profit by the
average of capital employed as reported in the
consolidated statement of financial position. Capital
employed includes borrowings, cash and cash
equivalents, derivative financial instruments included
in trade and other receivables/payables, short term
investments, collateral assets, financial liabilities under
put option arrangements and equity.
Pre-tax ROCE (controlled)
Post-tax ROCE (controlled
and associates/joint
ventures)
As above.
We calculate pre-tax ROCE (controlled) by using
Operating profit excluding interest on lease liabilities,
restructuring costs arising from discrete restructuring
plans, impairment losses/reversals, other income and
expense, the impact of hyper-inflationary adjustments
in Turkey and the share of results of equity accounted
associates and joint ventures. On a post-tax basis, the
measure includes our Adjusted share of results from
associates and joint ventures and a notional tax charge.
Capital is equivalent to net operating assets and is
calculated as the average of opening and closing
balances of: property, plant and equipment (including
leased assets and lease liabilities), intangible assets
(including goodwill), operating working capital
(including held for sale assets and excluding derivative
balances) and provisions, excluding the impact of
hyper-inflationary adjustments in Turkey. Other assets
that do not directly contribute to returns are excluded
from this measure and include other investments,
current and deferred tax balances and post
employment benefits. On a post-tax basis, ROCE also
includes our investments in associates and joint
ventures.
ROCE using GAAP measures
The table below presents the calculation of ROCE using GAAP measures as reported in the consolidated income statement and consolidated
statement of financial position.
Re-presented1
FY24
FY23
€m
€m
Operating profit2
3,665
14,451
Borrowings
56,987
66,390
Cash and cash equivalents
(6,183)
(11,705)
Derivative financial instruments included in trade and other receivables
(4,226)
(6,124)
Derivative financial instruments included in trade and other payables
1,524
1,422
Short-term investments
(3,225)
(4,305)
Collateral assets
(741)
(239)
Financial liabilities under put option arrangements
–
485
Equity
60,998
64,483
Capital employed at end of the year
105,134
110,407
Average capital employed for the year
107,771
111,062
ROCE using GAAP measures
3.4%
13.0%
Notes:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 Operating profit includes Other income/(expense), which includes merger and acquisition activity that is non-recurring in nature.
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Other information
Return on Capital Employed (‘ROCE’) : Non-GAAP basis
The table below presents the calculation of ROCE using non-GAAP measures and reconciliations to the closest equivalent GAAP measure.
Re-presented1
FY242
FY232
€m
€m
Operating profit
3,665
14,451
Interest on lease liabilities
(440)
(355)
Restructuring costs
703
538
Other income
(372)
(9,402)
Share of results of equity accounted associates and joint ventures
96
(433)
Impairment (reversal)/loss
(64)
64
Other adjustments3
296
(413)
Adjusted operating profit for calculating pre-tax ROCE (controlled)
3,884
4,450
Adjusted share of results of equity accounted associates and joint ventures used in post-tax ROCE4
(116)
430
Notional tax at Adjusted effective tax rate5
(923)
(1,249)
Adjusted operating profit for calculating post-tax ROCE (controlled and associates/joint
ventures)
2,845
3,631
Capital employed for calculating ROCE on a GAAP basis
105,134
110,407
Adjustments to exclude:
- Leases
(9,672)
(13,364)
- Deferred tax assets
(20,177)
(19,316)
- Deferred tax liabilities
699
771
- Taxation recoverable
(76)
(279)
- Taxation liabilities
393
457
- Other investments
(1,543)
(1,781)
- Investments in associates and joint ventures
(10,032)
(11,079)
- Pension assets and liabilities
(76)
(71)
- Removal of capital employed related to discontinued operations
(12,129)
(12,180)
- Other adjustments3
(1,009)
(877)
Adjusted capital employed for calculating pre-tax ROCE (controlled)
51,512
52,688
Investments in associates and joint ventures2
10,032
11,079
Adjusted capital employed for calculating post-tax ROCE (controlled and associates/joint
ventures)
61,544
63,767
Average capital employed for calculating pre-tax ROCE (controlled)2
52,100
54,440
Average capital employed for calculating post-tax ROCE (controlled and associates/joint
ventures)2
62,656
59,713
Pre-tax ROCE (controlled)
7.5%
8.2%
Post-tax ROCE (controlled and associates/joint ventures)
4.5%
6.1%
Notes:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
2 FY23 ROCE calculations exclude the results of Vantage Towers until its disposal on 22 March 2023 and the investment in Oak Holdings 1 GmbH from that date. FY23 capital employed for
calculating post-tax ROCE (controlled and associates/joint ventures), FY22 Capital employed for calculating pre-tax ROCE (controlled) and FY22 capital employed for calculating post-tax
ROCE (controlled and associates/joint ventures) have been adjusted to €57,911 million, €56,192 million and €61,515 million, respectively, for the purposes of calculating relevant FY23
averages.
3 Comprises adjustments to exclude hyperinflationary accounting in Turkey.
4 Adjusted share of results of equity accounted associates and joint ventures used in post-tax ROCE is a non-GAAP measure and excludes restructuring costs and other income.
5 Includes tax at the Adjusted effective tax rate of 24.5% (FY23: 25.6%).
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Financials
Other information
Non-GAAP measures (continued)
Unaudited information
Financing and Taxation metrics
Non-GAAP measure
Purpose
Definition
Adjusted net financing
costs
This metric is used by both management and the
investor community.
Adjusted net financing costs exclude mark-to-market
and foreign exchange gains/losses.
This metric is used in the calculation of Adjusted
basic earnings per share.
Adjusted profit before
taxation
This metric is used in the calculation of the Adjusted
effective tax rate (see below).
Adjusted profit before taxation excludes the tax effects
of items excluded from Adjusted basic earnings per
share, including: impairment losses/reversals,
amortisation of customer bases and brand intangible
assets, restructuring costs arising from discrete
restructuring plans, other income and expense and
mark-to-market and foreign exchange movements.
Adjusted income tax
expense
This metric is used in the calculation of the Adjusted
effective tax rate (see below).
Adjusted income tax expense excludes the tax effects
of items excluded from Adjusted basic earnings per
share, including: impairment losses/reversals,
amortisation of customer bases and brand intangible
assets, restructuring costs arising from discrete
restructuring plans, other income and expense and
mark-to-market and foreign exchange movements. It
also excludes deferred tax movements relating to tax
losses in Luxembourg as well as other significant one-
off items.
Adjusted effective tax rate This metric is used by both management and the
investor community.
Adjusted income tax expense (see above) divided by
Adjusted profit before taxation (see above).
Adjusted share of results
of equity accounted
associates and joint
ventures
This metric is used in the calculation of Adjusted
effective tax rate.
Share of results of equity accounted associates and
joint ventures excluding restructuring costs,
amortisation of acquired customer base and brand
intangible assets and other income and expense.
Adjusted share of results
of equity accounted
associates and joint
ventures used in post-tax
ROCE
This metric is used in the calculation of post-tax ROCE
(controlled and associates/joint ventures).
Share of results of equity accounted associates and
joint ventures excluding restructuring costs and other
income and expense.
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Financials
Other information
Adjusted tax metrics
The table below reconciles Profit before taxation and Income tax expense to Adjusted profit before taxation, Adjusted income tax expense and
Adjusted effective tax rate.
Re-presented1
FY24
FY23
€m
€m
Profit before taxation
1,620
13,074
Adjustments to derive Adjusted profit before tax
1,466
(8,424)
Adjusted profit before taxation
3,086
4,650
Adjusted share of results of equity accounted associates and joint ventures
(227)
(653)
Adjusted profit before tax for calculating Adjusted effective tax rate
2,859
3,997
Income tax expense
(50)
(492)
Tax on adjustments to derive Adjusted profit before tax
(342)
(205)
Adjustments:
- Deferred tax on recognition of Luxembourg losses in the year
(1,019)
–
- Deferred tax on use of Luxembourg losses in the year
598
33
- UK corporate interest restriction
78
15
- Tax relating to hyperinflation accounting
35
(309)
- Tax relating to Vantage Towers disposal
–
(66)
Adjusted income tax expense for calculating Adjusted tax rate
(700)
(1,024)
Adjusted effective tax rate
24.5%
25.6%
Note:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
Adjusted share of results of equity accounted associates and joint ventures
The table below reconciles Adjusted share of results of equity accounted associates and joint ventures to the closest GAAP equivalent, Share of
results of equity accounted associates and joint ventures.
FY24
FY23
€m
€m
Share of results of equity accounted associates and joint ventures
(96)
433
Restructuring costs
7
6
Other income
(27)
(9)
Adjusted share of results of equity accounted associates and joint ventures used in post-tax ROCE
(116)
430
Amortisation of acquired customer base and brand intangible assets
343
223
Adjusted share of results of equity accounted associates and joint ventures
227
653
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Other information
Additional information
Unaudited information
Analysis of depreciation and amortisation
The table below presents an analysis of the different components of depreciation and amortisation discussed in the document, reconciled to the
GAAP amounts in the consolidated income statement.
Re-presented1
FY24
FY23
€m
€m
Depreciation on leased assets - included in Adjusted EBITDAaL
3,003
2,682
Depreciation on leased assets - included in Restructuring costs
14
51
Depreciation on leased assets
3,017
2,733
Depreciation on owned assets
3,882
4,140
Amortisation of owned intangible assets
3,515
3,380
Depreciation and amortisation on owned assets included in Restructuring costs
–
2
Depreciation and amortisation on owned assets
7,397
7,522
Total depreciation and amortisation on owned and leased assets
10,414
10,255
Loss on disposal of owned fixed assets
34
41
Loss on disposal of leased assets
–
(8)
Depreciation and amortisation - as recognised in the consolidated income statement
10,448
10,288
Note:
1 The results for the year ended 31 March 2023 have been re-presented to reflect that the results of Vodafone Spain and Vodafone Italy are now reported as discontinued operations. See note
7 ‘Discontinued operations and assets held for sale’ in the consolidated financial statements for more information.
Analysis of tangible and intangible additions
The table below presents an analysis of the different components of tangible and intangible additions discussed in the document.
FY24
FY23
€m
€m
Capital additions
6,331
8,378
Integration related capital additions
81
287
Licence and spectrum additions
283
439
Additions
6,695
9,104
Intangible asset additions
2,622
3,250
Property, plant and equipment owned additions
4,073
5,854
Total additions
6,695
9,104
Shareholder information
Unaudited information
2024/25 financial calendar key dates
Ex-dividend date for final dividend for ordinary
shareholders
6 June 2024
Ex-dividend date for final dividend for ADR holders
7 June 2024
Record date for final dividend
7 June 2024
AGM
30 July 2024
Final dividend payment
2 August 2024
Useful contacts
The Registrar
Equiniti, Aspect House, Spencer Road, Lancing, West Sussex,
BN99 6DA
Telephone: +44 (0) 371 384 2532
See help.shareview.co.uk for more
information about this service
ADS holders
EQ Shareowner Services P.O. Box 64504 St. Paul, MN 55164-0504
United States of America
Telephone: +1 800 990 1135 (toll free), or for calls from outside the
United States: +1 651 453 2128
See shareowneronline.com for more
information about this service
Shareholder information
Managing your shares via Shareview
Our share registrar, Equiniti, operates a portfolio service, Shareview,
for investors in ordinary shares. This provides our shareholders with
online access to information about their investments, as well as a
facility to help manage their holdings online, such as being able to:
– update your details online including your address and dividend
payment instructions;
– buy and sell shares easily;
– receive certain shareholder communications electronically;
– send your general meeting voting instructions in advance of
shareholder meetings;
– view information about and join the Vodafone Group Plc Dividend
Reinvestment Plan (‘DRIP’); and
– access your online statements.
Equiniti also offers an internet and telephone share dealing
service to existing shareholders.
See shareview.co.uk for more information about this service.
Shareholders with any queries regarding their holding should contact
Equiniti on the contact details above.
Shareholders may also find the Investors section of our corporate
website useful for general queries and information about the
Company.
See vodafone.com/investor
for further details
AGM
Our fourtieth AGM will be held at The Pavilion, Vodafone House,
Newbury RG14 2FN on Tuesday, 30 July 2024 at 10.00 am.
Shareholder communications
We are taking steps to reduce our impact on our planet. The use of
electronic communications, rather than printed paper documents,
means information about the Company can be accessed through
emails or the Company’s website, thus supporting our efforts to
reduce our impact on the environment.
A growing number of our shareholders have opted to receive
communications from us electronically. Shareholders who have done
so will be sent an email alert containing a link to the relevant
documents.
We encourage all our shareholders to sign up for this service. You can
register for this service at shareview.co.uk or by contacting Equiniti on
the telephone number provided on the left of this page.
See vodafone.com/investor
for further information about this service
ShareGift
We support ShareGift, the charity share donation scheme (registered
charity number 1052686). Through ShareGift, shareholders who
have only a very small number of shares, which might be considered
uneconomic to sell, are able to donate them to charity. Donated
shares are aggregated and sold by ShareGift, with the proceeds being
passed on to a wide range of UK charities.
See sharegift.org or call +44 (0)20 7930 3737
for further details
Warning to shareholders (‘boiler room’ scams)
Over recent years, we have become aware of investors who have
received unsolicited calls or correspondence, in some cases
purporting to have been issued by us, concerning investment matters.
These callers typically make claims of highly profitable investment
opportunities that turn out to be worthless or simply do not exist.
These approaches are usually made by unauthorised companies and
individuals and are commonly known as ‘boiler room’ scams. Investors
are advised to be wary of any unsolicited advice or offers to buy
shares. If it sounds too good to be true, it often is.
See the FCA website at fca.org.uk/scamsmart for
more detailed information about this or similar activities
Dividends
Read more on the dividend amount per share on pages 31 and 168.
Euro dividends
Dividends are declared in euros to align with the functional currency
of the Company, and paid in euros and pounds sterling according to
where the shareholder is resident. Cash dividends to ADS holders are
paid by the ADS depositary bank in US dollars. The foreign exchange
rates at which dividends declared in euros are converted into pounds
sterling and US dollars are calculated based on the average exchange
rate of the five business days during the week prior to the payment of
the dividend.
Payment of dividends by direct credit
We pay cash dividends directly to shareholders’ bank or building
society accounts. This ensures secure delivery and means dividend
payments are credited to shareholders’ designated accounts on the
same day payment is made. For ordinary shareholders, a dividend
confirmation covering both the interim and final dividends paid during
the financial year is sent to shareholders at the time of the interim
dividend in February.
Dividend reinvestment plan
We offer a dividend reinvestment plan which allows holders of
ordinary shares who choose to participate to use their cash dividends
to acquire additional shares in the Company. These are purchased on
their behalf by the plan administrator, Equiniti, through a low-cost
dealing arrangement. For ADS holders, J.P. Morgan, through its
transfer agent, EQ Shareowner Services, maintains the Global Invest
Direct Program, which is a direct purchase and sale plan for depositary
receipts with a dividend reinvestment facility.
See vodafone.com/dividends for further
information about dividend payments
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Financials
Other information
Shareholder information (continued)
Unaudited information
Taxation of dividends
See page 253 for details on dividend taxation.
Shareholders as at 31 March 2024
Number of ordinary shares held
Number of
accounts
% of total of
issued shares
1–1,000
19,179
0.02
1,001–5,000
9,367
0.08
5,001–50,000
4,003
0.18
50,001–100,000
266
0.07
100,001–500,000
420
0.36
More than 500,000
935
99.30
Major shareholders
As at 10 May 2024, J.P. Morgan, as custodian of our ADR programme,
held approximately 14% of our ordinary shares of 2020/21 US cents
each as nominee. At this date, the total number of ADRs outstanding
was 373,682,919.
As at 10 May 2024, 1,136 holders of ordinary shares had registered
addresses in the United States and held a total of approximately
0.01% of the ordinary shares of the Company.
As at 31 March 2024, the following voting rights and percentage
interests in the ordinary share capital of the Company, disclosable
under the Disclosure Guidance and Transparency Rule (‘DTR’) 5, had
been notified to the Directors.
Shareholder
Voting rights
Shareholding1
Emirates Telecommunications
Group Company PJSC (‘e&’)
3,790,743,685
14.006097%2
BlackRock, Inc.
1,690,543,089
6.23%
Liberty Global plc
1,335,000,000
4.92%
Norges Bank
803,179,853
3.0004%
Notes:
1. The percentage of voting rights detailed above was calculated at the time of the
relevant disclosures made in accordance with DTR 5.
2. On 24 April 2023, e& and two of its affiliates reported a total shareholding in Vodafone of
14.61% as of 12 April 2023 in a Schedule 13D filing with the SEC’.
The Company is not aware of any other changes in the interests
disclosed under DTR 5 between 31 March 2024 and 13 May 2024.
As far as the Company is aware, between 1 April 2021 and 13 May
2024, no shareholder held 3% or more of the voting rights
attributable to the ordinary shares of the Company other than
(i) J.P. Morgan, as custodian of our ADR program and (ii) e&,
BlackRock, Inc., Liberty Global plc and Norges Bank (as described
above).
The rights attaching to the ordinary shares of the Company held by
these shareholders are identical in all respects to the rights attaching
to all the ordinary shares of the Company. As at 13 May 2024, the
Directors are not aware of any other interest of 3% or more in the
ordinary share capital of the Company. The Company is not directly or
indirectly owned or controlled by any foreign government or any
other legal entity. There are no arrangements known to the Company
that could result in a change of control of the Company.
Other information
Articles of Association and applicable English law
The following description summarises certain provisions of the
Company’s Articles of Association and applicable English law. This
summary is qualified in its entirety by reference to the Companies Act
2006 and the Company’s Articles of Association. The Company is a
public limited company under the laws of England and Wales. The
Company is registered in England and Wales under the name
Vodafone Group Public Limited Company with the registration
number 1833679.
Full details of where copies of the Articles of Association can be
obtained are detailed on page 252 under ‘Documents on display’.
All of the Company’s ordinary shares are fully paid. Accordingly, no
further contribution of capital may be required by the Company from
the holders of such shares.
English law specifies that any alteration to the Articles of Association
must be approved by a special resolution of the Company’s
shareholders.
Articles of Association
The Company’s Articles of Association do not specifically restrict the
objects of the Company.
Directors
The Directors are empowered under the Articles of Association to
exercise all the powers of the Company subject to any restrictions in
the Articles of Association, the Companies Act 2006 (as defined in the
Articles of Association) and any special resolution.
Under the Company’s Articles of Association, a Director cannot vote
in respect of any proposal in which the Director, or any person
connected with the Director, has a material interest other than by
virtue of the Director’s interest in the Company’s shares or other
securities. However, this restriction on voting does not apply in certain
circumstances as set out in the Articles of Association.
The Directors are empowered to exercise all the powers of the
Company to borrow money, subject to the limitation that the
aggregate amount of all liabilities and obligations of the Group
outstanding at any time shall not exceed an amount equal to 1.5
times the aggregate of the Group’s share capital and reserves
calculated in the manner prescribed in the Articles of Association,
unless sanctioned by an ordinary resolution of the Company’s
shareholders.
Purchase of own shares
The Company can make market purchases of its own shares or agree
to do so in the future provided it is duly authorised by its members in
a general meeting and subject to and in accordance with section 701
of the Companies Act 2006. Such authority was given at the 2023
AGM.
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Financials
Other information
At each AGM, all Directors who are to remain on the Board, shall offer
themselves for election or re-election, as applicable, in accordance
with the Company’s Articles of Association and in the interests of
good corporate governance.
Directors are not required under the Company’s Articles of
Association to hold any shares of the Company as a qualification to
act as a Director, although the Executive Directors are required to
under the Company’s Remuneration Policy.
Read more on the Remuneration Policy
on pages 100-105
Rights attaching to the Company’s shares
At 31 March 2024, the issued share capital and percentage of total
share capital represented by each share class of the Company was as
follows.
Number
Percentage
Preference shares
50,000
0.0001%
Ordinary shares
(excluding treasury shares)
27,080,121,854
93.9672%
Treasury shares
1,738,561,954
6.0327%
Ordinary shares (total)
28,818,683,808
99.9999%
Total shares
(preference and ordinary)
28,818,733,808
100.0000%
Dividend rights
Holders of 7% cumulative fixed rate shares are entitled to be paid
in respect of each financial year, or other accounting period of the
Company, a fixed cumulative preferential dividend of 7% p.a. on the
nominal value of the fixed rate shares. A fixed cumulative preferential
dividend may only be paid out of available distributable profits that
the Directors have resolved should be distributed.
The fixed rate shares do not have any other right to share in the
Company’s profits.
Holders of the Company’s ordinary shares may, by ordinary resolution,
declare dividends but may not declare dividends in excess of the
amount recommended by the Directors. The Board of Directors may
also pay interim dividends. No dividend may be paid other than out of
profits available for distribution.
Dividends on ordinary shares can be paid to shareholders in
whichever currency the Directors decide, using an appropriate
exchange rate for any currency conversions that are required.
If a dividend has not been claimed for one year after the date of the
resolution passed at a general meeting declaring that dividend or the
resolution of the Directors providing for payment of that dividend, the
Directors may invest the dividend or use it in some other way for the
benefit of the Company until the dividend is claimed. If the dividend
remains unclaimed for 12 years after the relevant resolution either
declaring that dividend or providing for payment of that dividend,
it will be forfeited and belong to the Company.
Voting rights
At a general meeting of the Company, when voting on substantive
resolutions (i.e. any resolution that is not a procedural resolution)
each shareholder who is entitled to vote and is present in person or
by proxy has one vote for every share held (a poll vote). Procedural
resolutions (such as a resolution to adjourn a general meeting or a
resolution on the choice of Chair of a general meeting) shall be
decided on a show of hands, where each shareholder who is present
at the meeting has one vote regardless of the number of shares held,
unless a poll is demanded.
Shareholders entitled to vote at general meetings may appoint
proxies who are entitled to vote, attend and speak at general
meetings. Two shareholders present in person or by proxy constitute
a quorum for purposes of a general meeting of the Company.
Under English law, shareholders of a public company such as the
Company are not permitted to pass resolutions by written consent.
Record holders of the Company’s ADSs are entitled to attend, speak
and vote on a poll or a show of hands at any general meeting of the
Company’s shareholders by the depositary’s appointment of them
as corporate representatives or proxies with respect to the underlying
ordinary shares represented by their ADSs. Alternatively, holders of
ADSs are entitled to vote by supplying their voting instructions to the
depositary or its nominee who will vote the ordinary shares
underlying their ADSs in accordance with their instructions.
Holders of the Company’s ADSs are entitled to receive notices of
shareholders’ meetings under the terms of the deposit agreement
relating to the ADSs.
Employees who hold vested shares in an EquatePlus account are able
to vote by submitting instructions online through the EquatePlus
platform. Note there are two vested share accounts with
Computershare (SPA, in respect of shares arising from a SAYE
exercise, and MyShareBank, in respect of vested shares from the
Global Incentive Plan).
Holders of the Company’s 7% cumulative fixed rate shares are only
entitled to vote on any resolution to vary or abrogate the rights
attached to the fixed rate shares. Holders have one vote for every fully
paid 7% cumulative fixed rate share.
Liquidation rights
In the event of the liquidation of the Company, after payment of all
liabilities and deductions in accordance with English law, the holders
of the Company’s 7% cumulative fixed rate shares would be entitled
to a sum equal to the capital paid up on such shares, together with
certain dividend payments, in priority to holders of the Company’s
ordinary shares. The holders of the fixed rate shares do not have any
other right to share in the Company’s surplus assets.
Pre-emptive rights and new issues of shares
Under section 549 of the Companies Act 2006 Directors are, with
certain exceptions, unable to allot the Company’s ordinary shares or
securities convertible into the Company’s ordinary shares without the
authority of the shareholders in a general meeting. In addition, section
561 of the Companies Act 2006 imposes further restrictions on the
issue of equity securities (as defined in the Companies Act 2006
which includes the Company’s ordinary shares and securities
convertible into ordinary shares) that are, or are to be, paid up wholly
in cash and not first offered to existing shareholders. The Company’s
Articles of Association allow shareholders to authorise Directors for a
period specified in the relevant resolution to allot (i) relevant
securities generally up to an amount fixed by the shareholders and (ii)
equity securities for cash other than in connection with a pre-emptive
offer up to an amount specified by the shareholders and free of the
pre-emption restriction in section 561. At the 2023 AGM the amount
of relevant securities fixed by shareholders under (i) above and the
amount of equity securities specified by shareholders under (ii) above
were in line with the Pre-Emption Group’s Statement of Principles.
See investors.vodafone.com/agm2024 for further details of such
proposals provided in the 2024 Notice of AGM.
Disclosure of interests in the Company’s shares
There are no provisions in the Articles of Association whereby persons
acquiring, holding or disposing of a certain percentage of the
Company’s shares are required to make disclosure of their ownership
percentage, although such requirements exist under the DTRs.
General meetings and notices
Subject to the Articles of Association, AGMs are held at such times
and places as determined by the Directors of the Company. The
Directors may also, when they see fit, convene other general
meetings of the Company. General meetings may also be convened
on requisition as provided by the Companies Act 2006.
An AGM is required to be called on no less than 21 days’ notice in
writing. Subject to obtaining shareholder approval on an annual basis,
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Shareholder information (continued)
Unaudited information
the Company may call other general meetings on 14 days’ notice.
The Directors may determine that persons entitled to receive notices
of meetings are those persons entered on the register at the close of
business on a day determined by the Directors, but no later than 21
days before the date the relevant notice is sent. The notice may also
specify the record date, the time of which shall be determined in
accordance with the Articles of Association and the Companies Act
2006.
Under section 336 of the Companies Act 2006, the AGM must be held
each calendar year and within six months of the Company’s year end.
Variation of rights
If at any time the Company’s share capital is divided into different
classes of shares, the rights attached to any class may be varied,
subject to the provisions of the Companies Act 2006, either with the
consent in writing of the holders of three quarters in nominal value of
the shares of that class or at a separate meeting of the holders of the
shares of that class.
At every such separate meeting all of the provisions of the Articles of
Association relating to proceedings at a general meeting apply,
except that (i) the quorum is to be the number of persons (which
must be at least two) who hold or represent by proxy no less than one
third in nominal value of the issued shares of the class, or if such
quorum is not present at an adjourned meeting, one person who
holds shares of the class regardless of the number of shares he holds;
(ii) any person present in person or by proxy may demand a poll; and
(iii) each shareholder will have one vote per share held in that
particular class in the event a poll is taken. Class rights are deemed
not to have been varied by the creation or issue of new shares ranking
equally, with, or subsequent to that class of shares in sharing in profits
or assets of the Company or by a redemption or repurchase of the
shares by the Company.
Limitations on transfer, voting and shareholding
As far as the Company is aware there are no limitations imposed on
the transfer, holding or voting of the Company’s ordinary shares other
than those limitations that would generally apply to all of the
shareholders, which apply by law (e.g. due to insider dealing rules) or
those that apply as a result of failure to comply with a notice under
section 793 of the Companies Act 2006.
No shareholder has any securities carrying special rights with regard
to control of the Company. The Company is not aware of any
agreements between holders of securities that may result in
restrictions on the transfer of securities.
Documents on display
The Company is subject to the information requirements of the US
Securities Exchange Act of 1934 (the ‘Exchange Act’) applicable to
foreign private issuers. In accordance with these requirements, the
Company files its Annual Report on Form 20-F and other related
documents with the US Securities and Exchange Commission (the
‘SEC’). These documents may be inspected at the SEC’s public
reference rooms located at 100 F Street, NE Washington, DC 20549.
Information on the operation of the public reference rooms can be
obtained in the United States by calling the SEC on +1-800-SEC-0330.
In addition, some of the Company’s SEC filings, including all those
filed on or after 4 November 2002, are available on the SEC’s website
at sec.gov.
Click to download a copy of the Company’s Articles of Association.
Copies can also be obtained from the Company’s registered office
Material contracts
At the date of this Annual Report, the Group is not party to any
contracts that are considered material to its results or operations
except for:
– its EUR 3,840,000,000 (as increased to EUR 4,050,000,000) and
USD 3,935,000,000 (as increased to USD 4,004,000,000) revolving
credit facilities which are discussed in note 21 ‘Borrowings’ to the
consolidated statements;
– the Implementation Agreement dated 20 March 2017, as
amended, relating to the combination of the Indian mobile
telecommunications businesses of Vodafone Group and Idea Group
as detailed in note 27 ‘Acquisitions and disposals’ to the
consolidated financial statements;
– the Investment Agreement dated 9 November 2022, as amended,
and Shareholders’ Agreement dated 22 March 2023, by which
Vodafone established a co-control partnership for Vantage Towers
AG with a consortium of long-term infrastructure investors led by
Global Infrastructure Partners and KKR;
– the Relationship Agreement entered into with Emirates
Telecommunications Group Company PJSC (“e&”) on 11 May 2023,
relating to (i) the proposed appointment of up to two individuals
nominated by e& as non-executive directors to the Board of
Vodafone Group Plc and (ii) the ongoing relationship between e&
and the Company.
– the Sale and Purchase Agreement dated 31 October 2023 between
Vodafone Europe B.V., Zegona Bidco, S.L.U., Zegona
Communications PLC and Zegona Limited relating to the sale and
purchase of Vodafone Holdings Europe S.L.U.; and
– the Sale and Purchase Agreement dated 15 March 2024 between
Vodafone Europe B.V., Swisscom Italia S.R.L., Vodafone Group Plc
and Swisscom AG relating to the sale and purchase of Vodafone
Italia s.p.a..
Exchange controls
There are no UK Government laws, decrees or regulations that restrict
or affect the export or import of capital including, but not limited to,
foreign exchange controls on remittance of dividends on the ordinary
shares or on the conduct of the Group’s operations.
Taxation
As tax is a complex area, investors should consult their own tax
adviser regarding the US federal, state and local, the UK and other tax
consequences of owning and disposing of shares and ADSs in their
particular circumstances.
This section describes, primarily for a US holder (as defined below),
in general terms, the principal US federal income tax and UK tax
consequences of owning or disposing of shares or ADSs in the
Company held as capital assets (for US and UK tax purposes). This
section does not, however, cover the tax consequences for members
of certain classes of holders subject to special rules including, for
example: US expatriates and former long-term residents of the United
States; officers and employees of the Company; holders who, directly,
indirectly or by attribution hold 5% or more of the Company’s stock
(by vote or value); financial institutions; insurance companies;
individual retirement accounts and other tax-deferred accounts;
tax-exempt organisations; dealers in securities or currencies; investors
that will hold shares or ADSs as part of straddles, hedging transactions
or conversion transactions for US federal income tax purposes;
investors holding shares or ADSs in connection with a trade or
business conducted outside of the US; or US holders whose
functional currency is not the US dollar.
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A US holder is a beneficial owner of shares or ADSs for US federal
income tax purposes if they are:
– an individual citizen or resident of the United States;
– a US domestic corporation;
– an estate, the income of which is subject to US federal income tax
regardless of its source; or
– a trust, if a US court can exercise primary supervision over the
trust’s administration and one or more US persons are authorised
to control all substantial decisions of the trust, or the trust has
validly elected to be treated as a domestic trust for US federal
income tax purposes.
If an entity or arrangement treated as a partnership for US federal
income tax purposes holds the shares or ADSs, the US federal income
tax treatment of a partner in such partnership will generally depend
on the status of the partner and the tax treatment of the partnership.
Holders that are entities or arrangements treated as partnerships for
US federal income tax purposes should consult their tax advisers
concerning the US federal income tax consequences to them and
their partners of the ownership and disposition of shares or ADSs by
the partnership.
This section is based on the US Internal Revenue Code of 1986, as
amended, its legislative history, existing and proposed regulations
thereunder, published rulings and court decisions, and on the tax laws
of the UK, the Double Taxation Convention between the United States
and the UK (the ‘treaty’) and current HM Revenue and Customs
(‘HMRC’) practice, all as of the date hereof. These laws and such
practice are subject to change, possibly on a retroactive basis.
This section is further based in part upon the representations of the
depositary and assumes that each obligation in the deposit
agreement and any related agreement will be performed in
accordance with its terms.
For the purposes of the treaty and the US-UK double taxation
convention relating to estate and gift taxes (the ‘Estate Tax
Convention’), and for US federal income tax and UK tax purposes, this
section is based on the assumption that a holder of ADRs evidencing
ADSs will generally be treated as the owner of the shares in the
Company represented by those ADRs. Investors should note that a
ruling by the first-tier tax tribunal in the UK has cast doubt on this
view, but HMRC has stated that it will continue to apply its long-
standing practice of regarding the holder of such ADRs as holding the
beneficial interest in the underlying shares. Similarly, the US Treasury
has expressed concern that US holders of depositary receipts (such as
holders of ADRs representing our ADSs) may be claiming foreign tax
credits in situations where an intermediary in the chain of ownership
between such holders and the issuer of the security underlying the
depositary receipts, or a party to whom depositary receipts or
deposited shares are delivered by the depositary prior to the receipt
by the depositary of the corresponding securities, has taken actions
inconsistent with the ownership of the underlying security by
the person claiming the credit, such as a disposition of such security.
Such actions may also be inconsistent with the claiming of the
reduced tax rates that may be applicable to certain dividends received
by certain non-corporate holders, as described below. Accordingly, (i)
the creditability of any UK taxes and (ii) the availability of the reduced
tax rates for any dividends received by certain non-corporate US
holders, each as described below, could be affected by actions taken
by such parties or intermediaries. Generally exchanges of shares for
ADRs and ADRs for shares will not be subject to US federal income tax
or to UK tax other than stamp duty or stamp duty reserve tax.
Taxation of dividends
UK taxation
Under current UK law, there is no requirement to withhold tax from
the dividends that we pay. Shareholders who are within the scope of
UK corporation tax will be subject to corporation tax on the dividends
we pay unless the dividends fall within an exempt class and certain
other conditions are met. It is expected that the dividends we pay
would generally be exempt.
Individual shareholders in the Company who are resident in the UK
will be subject to income tax on the dividends we pay. Dividends will
be taxable in the UK at the dividend rates applicable where the
income received is above the dividend allowance (£1,000 in this tax
year, falling to £500 from 6 April 2024) which is taxed at a nil rate.
Dividend income is treated as the highest part of an individual
shareholder’s income and the dividend allowance will count towards
the basic or higher rate limits (as applicable), which may affect the
rate of tax due on any dividend income in excess of the allowance.
US federal income taxation
Subject to the passive foreign investment company (‘PFIC’) rules
described below, a US holder is subject to US federal income taxation
on the gross amount of any dividend we pay out of our current or
accumulated earnings and profits (as determined for US federal
income tax purposes). Distributions in excess of current and
accumulated earnings and profits will be treated as a non-taxable
return of capital to the extent of the US holder’s basis in the shares or
ADSs and thereafter as capital gain.
However, the Company does not maintain calculations of its earnings
and profits in accordance with US federal income tax accounting
principles. US holders should, therefore, assume that any distribution
by the Company with respect to shares will be reported as ordinary
dividend income. Dividends paid to a non-corporate US holder will be
taxable to the holder at the reduced rate normally applicable to
long-term capital gains provided that certain requirements are met.
Dividends must be included in income when the US holder, in the
case of shares, or the depositary, in the case of ADSs, actually or
constructively receives the dividend and will not be eligible for the
dividends-received deduction generally allowed to US corporations in
respect of dividends received from other US corporations.
The amount of the dividend distribution to be included in income will
be the US dollar value of the pound sterling or euro payments made
determined at the spot pound sterling/US dollar rate or the spot
euro/US dollar rate, as applicable, on the date the dividends are
received by the US holder, in the case of shares, or the depositary, in
the case of ADSs, regardless of whether the payment is in fact
converted into US dollars at that time. If dividends received in pounds
sterling or euros are converted into US dollars on the day they are
received, the US holder generally will not be required to recognise
any foreign currency gain or loss in respect of the dividend income.
Where UK tax is payable on any dividends received, a US holder may
be entitled, subject to certain limitations, to a foreign tax credit in
respect of such taxes.
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Taxation of capital gains
UK taxation
A US holder that is not resident in the UK will generally not be liable
for UK tax in respect of any capital gain realised on a disposal of our
shares or ADSs.
However, a US holder may be liable for both UK and US tax in respect
of a gain on the disposal of our shares or ADSs if the US holder:
– is a citizen of the United States and is resident in the UK;
– is an individual who realises such a gain during a period of
‘temporary non-residence’ (broadly, where the individual becomes
resident in the UK, having ceased to be so resident for a period of
five years or less, and was resident in the UK for at least four out of
the seven tax years immediately preceding the year of departure
from the UK);
– is a US domestic corporation resident in the UK by reason of being
centrally managed and controlled in the UK; or
– is a citizen or a resident of the United States, or a US domestic
corporation, that has used, held or acquired the shares or ADSs in
connection with a branch, agency or permanent establishment in
the UK through which it carries on a trade, profession or vocation in
the UK.
In such circumstances, relief from double taxation may be available
under the treaty. Holders who may fall within one of the above
categories should consult their professional advisers.
US federal income taxation
Subject to the PFIC rules described below, a US holder that sells or
otherwise disposes of our shares or ADSs generally will recognise a
capital gain or loss for US federal income tax purposes equal to the
difference, if any, between the US dollar value of the amount realised
and the holder’s adjusted tax basis, determined in US dollars, in the
shares or ADSs. This capital gain or loss will be a long-term capital
gain or loss if the US holder’s holding period in the shares or ADSs
exceeds one year.
The gain or loss will generally be income or loss from sources within
the US for foreign tax credit limitation purposes. The deductibility of
losses is subject to limitations.
Additional tax considerations
UK inheritance tax
An individual who is domiciled in the United States (for the purposes
of the Estate Tax Convention) and is not a UK national will not be
subject to UK inheritance tax in respect of our shares or ADSs on the
individual’s death or on a transfer of the shares or ADSs during the
individual’s lifetime, provided that any applicable US federal gift or
estate tax is paid, unless the shares or ADSs are part of the business
property of a UK permanent establishment or pertain to a UK fixed
base used for the performance of independent personal services.
Where the shares or ADSs have been placed in trust by a settlor they
may be subject to UK inheritance tax unless, when the trust was
created, the settlor was domiciled in the United States and was not a
UK national. Where the shares or ADSs are subject to both UK
inheritance tax and to US federal gift or estate tax, the Estate Tax
Convention generally provides a credit against US federal tax liabilities
for UK inheritance tax paid. The above description does not take into
account any change in law or practice that may arise from proposed
changes announced by the UK government on 6 March 2024 to the
taxation of non-UK domiciled individuals, and specific professional
advice should be sought on this matter if relevant.
UK stamp duty and stamp duty reserve tax
Stamp duty will, subject to certain exceptions, be payable on any
instrument transferring our shares to the custodian of the depositary
at the rate of 1.5% on the amount or value of the consideration if on
sale or on the value of such shares if not on sale. Stamp duty reserve
tax (‘SDRT’), at the rate of 1.5% of the amount or value of the
consideration or the value of the shares, could also be payable in
these circumstances but no SDRT will be payable if stamp duty equal
to such SDRT liability is paid. However, such transfers will not attract
stamp duty or SDRT where they satisfy the conditions of an
exemption, including exemptions which can apply to certain capital
raising or qualifying listing arrangements. Specific professional advice
should be sought before paying a 1.5% SDRT or stamp duty charge in
any circumstances.
No stamp duty should, in practice, be required to be paid on any
transfer of our ADSs provided that the ADSs and any separate
instrument of transfer are executed and retained at all times outside
the UK.
A transfer of our shares in registered form will attract ad valorem
stamp duty, generally at the rate of 0.5% of the purchase price of the
shares. There is no charge to ad valorem stamp duty on gifts.
SDRT is generally payable on an unconditional agreement to transfer
our shares in registered form at 0.5% of the amount or value of the
consideration for the transfer, but if, within six years of the date of the
agreement, an instrument transferring the shares is executed and
stamped, any SDRT that has been paid would be repayable or, if the
SDRT has not been paid, the liability to pay the tax (but not
necessarily interest and penalties) would be cancelled. However, an
agreement to transfer our ADSs will not give rise to SDRT.
PFIC rules
We do not believe that our shares or ADSs will be stock of a PFIC
for US federal income tax purposes for our current taxable year or
the foreseeable future. This conclusion is a factual determination
that is made annually and thus is subject to change. If we are a PFIC,
US holders of shares would be required (i) to pay a special US addition
to tax on certain distributions and (ii) any gain realised on the sale
or other disposition of the shares or ADSs would in general not
be treated as a capital gain unless a US holder elects to be taxed
annually on a mark-to-market basis with respect to the shares or
ADSs.
Otherwise a US holder would be treated as if he or she has realised
such gain and certain ‘excess distributions’ rateably over the holding
period for the shares or ADSs and would be taxed at the highest tax
rate in effect for each such year to which the gain was allocated. An
interest charge in respect of the tax attributable to each such
preceding year beginning with the first such year in which our shares
or ADSs were treated as stock in a PFIC would also apply. In addition,
dividends received from us would not be eligible for the reduced rate
of tax described above under ‘Taxation of dividends – US federal
income taxation’.
Back-up withholding and information reporting
Payments of dividends and other proceeds to a US holder with
respect to shares or ADSs, by a US paying agent or other US
intermediary, will be reported to the Internal Revenue Service and to
the US holder as may be required under applicable regulations.
Back-up withholding may apply to these payments if the US holder
fails to provide an accurate taxpayer identification number or
certification of exempt status or fails to comply with applicable
certification requirements.
Certain US holders are not subject to back-up withholding. US holders
should consult their tax advisers about these rules and any other
reporting obligations that may apply to the ownership or disposition
of shares or ADSs, including requirements related to the holding of
certain foreign financial assets.
Shareholder information (continued)
Unaudited information
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The Company was incorporated under English law in 1984 as Racal
Strategic Radio Limited (registered number 1833679). After various
name changes, 20% of Racal Telecom Plc share capital was offered
to the public in October 1988. The Company was fully demerged
from Racal Electronics Plc and became an independent company
in September 1991 at which time it changed its name to Vodafone
Group Plc. Since then we have entered into various transactions
which impacted the development of the Group. The most significant
in the year ended 31 March 2024 are summarised below.
– On 29 March 2023, the Vodafone Group announced the initiation
of procedures for a statutory merger and squeeze-out of minority
shareholders in Kabel Deutschland Holding AG (’KDG’). This is
procedure is now complete and Vodafone Group own 100% of
KDG.
– On 14 June 2023 Vodafone Group and CK Hutchison Group
Telecom Holdings Limited (“CKHGT”), a wholly owned subsidiary of
CK Hutchison Holdings Limited, entered into binding agreements in
relation to a combination of their UK telecommunication
businesses, respectively Vodafone UK and Three UK (the
“Transaction”). Vodafone will own 51% of the combined business
(“MergeCo”) and CKHGT 49%. Vodafone UK will be contributed
with £4.3 billion and Three UK with £1.7 billion, subject to
customary completion adjustments. MergeCo’s aggregate
consolidated free cash flow will be distributed to the shareholders
at least on an annual basis, subject to a target aggregate
consolidated net financial debt of 2.5x MergeCo’s 12 month rolling
Adjusted EBITDAaL.
– On 18 July 2023 further to the announcement of a co-control
partnership for Vantage Towers on 9 November 2022, Vodafone
Group announced that, based on commitments secured by the
consortium of long-term infrastructure investors led by Global
Infrastructure Partners and KKR (together the “Consortium”),
Vodafone will receive further proceeds of €500 million, taking total
net proceeds to €5.4 billion and the Consortium’s ownership in Oak
Holdings GmbH (“Oak Holdings”) to 40%. Vodafone agreed with the
Consortium a further 6 month window to acquire additional shares
in Oak Holdings at the same price, up to a maximum of 50%
ownership, by the end of 2023. Vodafone’s 12 month option to
pursue a sell-down to a 50% ownership stake in Oak Holdings
outside of lock-up provisions and other restrictions will now
commence on 1 January 2024.
– On 31 October 2023 Vodafone Group announced that it entered
into a binding agreement with Zegona Communications plc
(“Zegona”) in relation to the sale of 100% of Vodafone Holdings
Europe, S.L.U. (“Vodafone Spain”) (the “Transaction”). On
completion, Vodafone’s consideration will comprise at least €4.1
billion in cash and up to €0.9 billion in the form of Redeemable
Preference Shares which redeem, for an amount comprising the
subscription price and accrued preferential dividend, no later than
6 years after closing. Vodafone and Zegona have entered into an
agreement whereby Vodafone will provide certain services to
Vodafone Spain for a total annual service charge of c.€110 million.
– On 15 March 2024 Vodafone Group announced a binding
agreement to sell 100% of its Italian operations (“Vodafone Italy”)
to Swisscom AG (“Swisscom”) (the “Transaction”). As part of the
Transaction, Vodafone and Swisscom have agreed that Vodafone
will continue to provide certain services (the “Group Services”) to
Swisscom for up to 5 years. The annual charge for the Group
Services to be paid by Swisscom to Vodafone for the first year after
completion is estimated at approximately €350 million, of which
approximately €176 million reflect charges currently reported
below Vodafone Italy’s segmental Adjusted EBITDAaL.
Introduction
Our operating companies are generally subject to regulation
governing their business activities. Such regulation typically takes the
form of industry-specific law and regulation covering
telecommunications services and general competition (anti-trust) law
applicable to all activities. The following section describes the
regulatory frameworks and the key regulatory developments at
national and regional levels and in the European Union (‘EU’), in which
we had significant interests during the period ended 31 March 2024.
Many of the regulatory developments reported in the following
section involve ongoing proceedings or consideration of potential
proceedings that have not reached a conclusion. Accordingly, we are
unable to attach a specific level of financial risk to our performance
from such matters.
EU
In November 2023, the EU adopted a regulation laying down
harmonised rules on fair access to and fair use of data (the ‘Data Act’).
The Regulation applies to manufacturers of connected devices, data
holders, recipients, and providers of data processing services (cloud
service providers) who will be subject to new requirements to support
switching and interoperability.
The Digital Markets Act (‘DMA’) was published in the official EU
Journal in November 2022 and implementation and enforcement are
underway. Providers of online platforms who pass the quantitative
thresholds to be designated as ’gatekeepers’ (annual turnover of €7.5
billion within the EU or a worldwide market valuation of €75 billion,
plus 45 million monthly active end-users and 10,000 business users)
will be subject to ex-ante regulatory obligations under the DMA. As of
February 2024, six companies have been designated as digital
gatekeepers across 20 Core Platform Services (CPS). The Digital
Markets Act became fully enforceable on 7th March 2024, with the six
companies designated as Digital Gatekeepers taking steps to comply
with the regulation and evidencing this in the form of a report to be
audited by the European Commission (‘EC’).
The European Commission has already launched investigations into
three Gatekeepers for possible non-compliance with their obligations
under the law: Apple, Google and Meta. The primary focus of these
investigations is on conditions and charges for developers within the
Apple and Google app stores, and in particular on the new Core
Technology Fee that Apple has announced as part of its DMA
compliance. The EC commits to conclude proceedings within 12
months. Companies will receive preliminary findings from the
Commission that they can respond to and the opportunity to submit
commitments. When the final decision is out, Gatekeepers will have
two months to appeal to the EU courts.
The Digital Services Act (‘DSA’) was also published in the official EU
Journal in November 2022. Online platforms, who have new
obligations under the DSA, will be required to report their numbers of
active users to the EC, to inform the designation of Very Large Online
Platforms (‘VLOPs’) who will be subject to additional risk assessment
and platform design obligations. As of August 2023, several
companies have been designated as VLOPs and are now subject to
regular auditing and regulatory requirements on platform design, risk
assessment and mitigation. Smaller online platforms and other
intermediaries became subject to new and updated rules on content
moderation and due diligence from 17 February 2024.
On 24 April 2023, the EU-Ukraine Association Committee in Trade
Configuration adopted a decision to apply EU Roam-Like-at-Home,
intra-EU communication provisions and EU fixed termination rates
(FTR) and mobile termination rates (MTR) between the EU and
Ukraine. The time frame for transposition by Ukraine is one year after
entry into force of this decision. The EC will then assess the
transposition and in a further step grant internal market treatment
History and development
Unaudited information
Regulation
Unaudited information
Read more in our financial
statements, note 12
‘Investments in associate
and joint arrangements’
Click here to view a simplified holding
structure for the Vodafone Group:
investors.vodafone.com/
VodafoneGroupHoldingStructure
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Regulation (continued)
Unaudited information
before the provisions become applicable. On 6 October 2023, the
EU-Moldova Association Committee in Trade Configuration adopted a
decision to apply EU Roam-Like-at-Home, intra-EU communication
provisions and EU fixed and mobile termination rates between the EU
and Moldova. The time frame for transposition by Moldova is one year
for intra-EU communications and two years for roaming and MTR/FTR
after entry into force of this decision. The EC will then assess the
transposition and in a further step grant internal market treatment
before the provisions become applicable.
On 15 January 2024, the EC published a Staff Working Document on
the findings of the 2023 review of the rules on EU-Roaming fair use
policies. The Roaming Regulation (EU) 2022/612 requires the EC to
periodically review the rules on (i) the application of fair use policy
and (ii) the methodology for assessing the sustainability of the
abolition of retail roaming surcharges. In its 2023 review, the EC
concluded that the current safeguards are working and remain
unchanged.
On 15 September 2022, the EC adopted its draft Cyber Resilience Act
(‘CRA’), introducing horizontal cybersecurity requirements for
products with digital elements and associated services that are placed
on the European single market. Products in scope will be subject to
conformity assessment. Highly critical products will be subject to
European cybersecurity certification schemes. The EC’s draft CRA has
entered the co-legislative process which is likely to be completed in
Q2/2024 and apply 18 months to three years thereafter. In December
2023, negotiators finalised the text of the EU Artificial Intelligence Act
(‘AI Act’), the world’s first comprehensive, horizontal regulation for AI
systems. The final text confirms the risk-based approach, where AI
systems surpassing a certain risk threshold are either prohibited
outright, or subject to proportionate regulatory obligations. The final
text also includes a compromise on General Purpose AI systems,
whereby all providers of these foundational technologies are subject
to some baseline regulatory requirements (transparency, record
keeping and compliance with Copyright law) and systems that are
deemed to be high impact (based on an evaluation of compute
power) subject to additional risk mitigation rules.
The Gigabit Infrastructure Act (‘GIA’) (which revises the 2014
Broadband Cost Reduction Directive (‘BCRD’) is in its last stages before
adoption. The GIA aims to reduce the cost of deploying gigabit
electronic communication networks. While some of the proposed
measures were watered down in the legislative process, welcomed
proposals include the right to submit applications for all permits (or
renewals) and rights of way in electronic format via a ‘Single
Information Point’, permit fees not exceeding administrative costs,
permit exemptions to civil engineering works, conditional tacit
approval on permits and access to rooftops. The European Parliament
proposed a ban on intra-EU communications retail surcharges which
is unrelated to the GIA proposal, and this could have material impact
on telecommunications operators. The legislators agreed to prolong
the current caps until 1 January 2029. Abolition of surcharges from
then onwards is conditional on (i) an EC review/impact assessment by
2027 and (ii) an EC implementing act on fair use provisions by 2028.
Otherwise, the caps will expire in 2032. The GIA determines that
telecommunications operators may voluntarily apply ‘call-like-at-
home’ charging from 1 Jan 2025 subject to fair use policy.
The EC & European Parliament adopted the GIA on 29 April 2024. This
will replace the 2014 BCRD. The new law aims to simplify and
accelerate the roll-out of high-speed networks, such as fibre and 5G,
with a view to achieving Europe’s connectivity objectives and targets
set out in the digital compass for this decade.
The new regulation also aims to lower the unnecessarily high costs of
the deployment of high-capacity networks partially caused by
permit-granting procedures. The latter will be simplified through a
mandatory conciliation mechanism between public sector bodies and
telecommunication operators. In addition, given that the present retail
price cap for regulated intra-EU communications will expire on 14 May
2024, the current caps of 19 eurocents per minute for calls and 6
eurocents per SMS message are extended until 30 June 2032 to
ensure protection, especially for vulnerable consumers.
The text will be published in the EU’s Official Journal and enter
into force before the end of May. The new law will apply 18
months after its entry into force with some specific provisions
applying at a later stage.
The EC adopted a recommendation on the promotion of Gigabit
Connectivity which seeks to provide guidance to National Regulatory
Authorities on the conditions of access to the telecommunications
networks of operators with significant market power ‘SMP’. This
instrument replaces the 2010 Next Generation Access
Recommendation and the 2013 Non-discrimination and Costing
Methodologies Recommendation. BEREC had adopted an opinion on
the draft and had raised several issues, including the lack of alignment
with the European Electronic Communications Code. It had specifically
mentioned, for example, that there is a lack of sources or impact
analysis clearly demonstrating that deregulating SMP Operators (e.g.
removing remedies such as price regulation, allowing for an increase in
copper access prices) speeds up very high capacity networks
deployment/take-up. The EC took the BEREC Opinion into account,
yet no substantial modifications were made. The EC also adopted, in
February 2024, a digital connectivity package aimed at fostering
innovation, security and resilience of digital infrastructures. The
package includes two components; a white paper and a
recommendation. The white paper entitled“How to master Europe’s
digital infrastructure needs?” analyses the challenges that Europe
faces regarding the rollout of future connectivity networks, and
presents possible scenarios to attract investments, foster innovation,
increase security, and achieve a true Digital Single Market. The
recommndationr elates to the security and resilience of submarine
cable infrastructures, focusing on improving submarine cable security
and resilience, through better EU coordination of governance and
funding. A public consultation on the White Paper scenarios is
on-going until 30 June 2024.
Country specific
Germany
Licences for frequency allocations at 800MHz, parts of 1800MHz, and
2600MHz will expire at the end of 2025. Vodafone Germany currently
holds allocations at 800MHz and 2600MHz. BNetzA is currently
assessing its options on how to proceed on the reallocation of this
spectrum. It may either re-auction the spectrum, or prolong the
existing licences, or a combination of these. BNetzA is expected to
make a final decision on next steps in Q2/2024.
In 2019, Vodafone acquired spectrum at 2.1GHz and 3.6GHz. The
spectrum allocation includes coverage obligations which, depending
on the specifics of the obligation, have to be fulfilled by end of either
2022 or 2024. All mobile network operators have reported on time on
the status of obligation fulfilment for the 2022 obligations, including
given judicial or factual circumstances hindering fulfilment. BNetzA
has assessed the reports, including Vodafone’s, and informed
Vodafone about the results at the end of September 2023. Currently,
BNetzA is conducting an official hearing with Vodafone on possible
fines for a minor number of cases of non-fulfilment. BNetzA is
expected to issue a final decision on potential fines after completion of
the hearing in Q2/2024.
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United Kingdom
In December 2023 Ofcom published proposals to restrict mid-
contract price rises to absolute values, rather than inflation linked
values. Ofcom expects the changes to be introduced later in 2024.
Ofcom believes the move to absolute value amounts will aid
transparency and allow consumers to make more informed
purchasing decisions.
The UK industry continues to work towards the introduction of a new
One-Touch Switching process. The introduction of the industry wide
process has been delayed, with some providers not ready. We have
carried out the necessary work and are ready to participate whenever
the process is launched (anticipated to be later in 2024). We continue
to co-operate with industry partners and Ofcom over the future
launch of the new process.
Vodacom: South Africa (‘SA’)
The NRA (‘ICASA’) has concluded a Review of the Pro-competitive
Conditions imposed on relevant licensees in terms of the Call
Termination Regulations and published its Findings document on 28
March 2022. ICASA gave notice on 26 May 2023 of its intention to
proceed with the cost modelling phase with the aim to implement
revised voice call termination rates. Information requests were issued
to all Licensees after initial workshop held on 31 May 2023. During
August 2023 ICASA finalised its consultation on costs standard and
determined that pure long run incremental cost standard to be used.
On 22 March 2024, ICASA published a draft amended to the Call
Termination Regulations for comment. The rates proposed for mobile
voice call termination, which are currently ZAR 9 cents for large
operators, will reduce to 7 cents from 01 July 2024, and 4 cents from
01 July 2025. For small operators, the rates proposed, which are
currently 13 cents, will reduce to 9 cents from 01 July 2024, and 4
cents from 01 July 2025. The rates proposed for fixed voice call
termination, which are currently 6 cents, will reduce to 4 cents from
01 July 2024, and 1 cent from 01 July 2025.
On 23 June 2023, the Department of Communication and Digital
Technology (‘DCDT’) published proposed amendments to the
Electronic Communications Act (‘Bill’) for comment. Vodacom SA has
submitted written comments on the Bill on 31 August 2023. The
adoption of the Bill in its current format could lead to significant
disruption of the local market, and specifically on Vodacom SA. The
DCDT indicated that it will wait until the next Parliament has been
elected (general election date 29 May 2024) before continuing with
the process of amending the Electronic Communications Act.
On 29 February 2024, NRA published draft amendments to the
End-user and Subscriber Service Charter (‘EUSSC’) Regulations 2016,
relating to bundle usage sequencing & roll-over, and the transfer of
bundles (or portions thereof) of voice minutes, SMS and data bundles,
for comment. The deadline for written comments is 15 April 2024.
Other Europe: Ireland; Portugal; Romania; Greece;
Czech Republic; Albania
Spectrum
In Portugal, Vodafone Portugal continues to appeal against certain
aspects of the auction conditions for the 5G auction, which concluded
in November 2021, claiming the conditions between new entrants
and mobile network operators were discriminatory. Legal proceedings
are still ongoing, with no expected date of conclusion, and the rights
of use remain in place.
In Albania, the NRA (AKEP) started preliminary discussions with the
operators on their interest in the 5G bands up for auction in November
2023 and published the official Public Consultation mid-January 2024
for the band 3.4GHz -3.8GHz only. The law frequency 700MHz is still
being utilised by the media operators. The regulator expects
comments and proposals on the document with regards to the
quantity of spectrum to be auctioned, price for 1MHz, coverage
obligations, size of blocks etc, by April 2024. Vodafone Albania has
already submitted its comments to the NRA for the 3.4GHz -3.8GHz
aiming to get usage rights for 100MHz of bandwitch allocation within
this band.
Concerns over electromagnetic field (‘EMF’) triggered a residents’
petition in Greece for the annulment of the 5G Auction Tender
document. Despite the auction process completing in December
2020 and the assigned spectrum already being in use by Vodafone
Greece, the petition against the Tender document was heard in
January 2022, and a decision by the Council of State is pending,
estimated to conclude in 2024. In the case that the petition is accepted,
the assignment of 5G spectrum rights will be declared invalid.
In July 2023, Greek NRA (EETT) informed mobile network operators
(‘MNO’s) on the results of on-site audits which took place from
October 2021 to March 2023 and indicated perceived breaches in
Microwave links emission. In this context, EETT called ΜNOs to submit
their views. Vodafone Greece replied to NRA’s letter and restored
licensing status where relevant. Following this procedure, in January
2024, EETT called ΜNOs to a Hearing via written memorandum.
Vodafone Greece submitted its memorandum and additional
supporting documentation on 19 February 2024. Decision is expected
to conclude in 2024.
Universal Service Obligations (‘USO’) and Consumer Support
Measures
Vodafone Greece has four active appeals against the NRA (‘EETT’).
The appeals are in relation to charges amounting to around €16.75
million. Of this, €9.0 million is in relation to the provision of universal
services by operator Hellenic Telecommunications Organisation (OTE)
for the period of 2010 through to 2011. Vodafone Greece has
appealed these costs, with the hearings due in April 2024 for 2010
and 2011. The remaining €7.75 million has been imposed on
Vodafone Greece due to a decision of EETT on the universal service
obligation USO net costs for the period of 2012 to 2016. Vodafone
Greece also appealed these costs.
The appeal has been referred to the Administrative Court of Appeal,
with the hearing due in November 2024. In addition, the Universal
Service Net Cost Allocation Decision for the years 2017 to 2019 was
issued in October 2023, with the Vodafone share (incl. CYTA) being
calculated at €2.2 million. Vodafone Greece appealed these costs
before the Administrative Court of Appeal in April 2024.
Similarly, Vodafone Portugal continues to challenge payment notices
totalling €34.8 million issued by ANACOM regarding 2012 to 2014
extraordinary compensation of USO costs.
Access
In Czech Republic, in December 2023 Vodafone announced that it
agreed with SAZKA a.s. to acquire the mobile virtual network operator
(MVNO) SAZKAmobil. The transaction was cleared by the competition
authority and was completed on 1 April 2024.
In Albania the NRA launched a Public Consultation on Mobile
termination rates aiming to reduce National MTRs from 1.11 lek/
minute with a target to 0.75 lek/minute with a 2 year glidepath. The
consultation has been finalised and NRA has issued the relevant
decisions defining the glidepath for national MTRs. International MTRs
remain deregulated.
Other Africa and Middle East: Democratic Republic
of the Congo (DRC); Tanzania; Mozambique;
Lesotho; Turkey; Egypt.
Devices and registration
In Tanzania, the Communications Regulator (‘TCRA’) issued
regulations that introduce a biometric registration requirement for
SIMs and restrict the number of SIMs a customer may own. The TCRA
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Regulation (continued)
Unaudited information
required the disconnection of unverified SIMs in this category by 13
February 2023. The TCRA conducted inspections and subsequently
following an inspection on 04 January 2024, the TCRA issued a
compliance order against Vodacom Tanzania for failure to adhere to
the regulations by allowing multiple SIM card registrations exceeding
the allowed limits. Vodacom Tanzania made submissions to the TCRA
and attended a hearing in this regard. The TCRA issued its final
decision issuing a penalty of TZS 14 million (approx. €5,000).
Similarly, in Lesotho, the Minister of Communication introduced new
SIM Registration regulations, which must be complied with by 24 June
2023. The regulations require the operator to enact biometric
registration, establish a central database with the Communications
Authority (‘LCA’), re-register SIMs with a six-month timeframe and
enforce penalties of Maloti 5,000 per non-compliant SIM card. On 1
February 2024, Vodacom Lesotho suspended all unregistered SIMs
for 3 months (01 Feb- 30 April). Customers will be able to re-activate
their numbers during the 90 days period, however, post 30 April 2024
all numbers not re-activated will be terminated.
Spectrum
In Mozambique, the 5G auction consultation proposes a reserve price
of $15m per 2x5 of 700MHz, $15m per 2.6GHz and $15m per 3.5GHz.
The price for 2.6GHz and 3.5GHz is comparatively excessive against
both Vodafone and neighbouring markets benchmarks. The proposed
draft auction rules are also against best practice. The
Communications Regulator has indicated a willingness to introduce
coverage obligations in exchange for marginally reduced pricing, but
these are yet to be reflected in the official auction rules. The final
auction rules are pending the approval of the cabinet of ministers.
In Egypt, the NRA (‘NTRA’) intends to initiate issuance of 5G radio
frequency spectrum licences; the initial proposal included an
indicative reserve price of US$450 million and successful bidders are
expected to incur US$450 million in 5G-related network investment.
Subsequently, the NTRA submitted a new proposal for the 5G license
terms and conditions at a cost of US$150 million for 15 years with
extension to all current licenses without spectrum. Vodafone Egypt
did not accept this. On 1 January 2024, Vodafone Egypt received an
offer from the NTRA for the 5G license entailing a license fee of USD
173m for a 15 year license terms and renewal of the 2G/3G/4G
licenses until 2038. This offer was valid until 15 January 2024. The
President had also directed that if the offer was not accepted by at
least one of the operators, the NTRA will be required to issue new
offer entailing USD 150m and renewal of existing licenses. On 15
January 2024, Vodafone Egypt rejected the offer, however, the
government owned Telecom Egypt accepted the offer and
announced its acquisition of a 5G license. On this basis, the
government is trying to push operators to obtain the 5G license under
similar terms and has currently closed off any possibility of further
negotiations. For Vodafone Egypt, the proposal is not aligned with its
business case.
In Turkey, the NRA issued a Board Decision regarding the Procedure
and Principles on 2G license extension, fee, and obligations. Procedures
and principles applied to Vodafone Turkey and Turkcell’s licenses that
expired on 27 April 2023 and TT Mobil’s license that will expire in 2026.
The extension fee for Vodafone Turkey (900 MHz) is €120 million for
a six-year extension until 30 April 2029 (excluding 18% VAT).
Vodafone Turkey paid the extension fee in advance with a capital
injection and signed the extension agreement effective as of 27 April
2023. Therefore, the 2G license was extended until 30 April 2029.
Regulatory and legal disputes and fines
In the DRC, Vodacom DRC is in ongoing negotiations with the NRA
(‘ARPTC’) in relation to new regulatory fees that were first introduced
in March 2022. On 22 October 2022, the MNOs (including Vodacom
DRC), Minister of Communications and ARPTC reached an agreement
and signed a MoU on the new regulatory fees, setting out revised fees
and modality of payment. The MoU also provides for resolution of any
pending fines and legal actions in this regard. Execution of each
party’s obligations under the MoU is ongoing.
In Tanzania, the TCRA found that Vodacom Tanzania had failed to
comply with regulatory Quality of Service (QoS) targets in May 2023,
mostly in the Zanzibar region, and has ordered Vodacom Tanzania to
implement network improvements, with threat of fines if it fails to comply.
Vodacom Tanzania completed implementation of five sites to address
this matter in July 2023 and continues to ensure more improvement
on optimisation is done to ensure coverage is maintained. Vodacom
plans to roll out 30 additional sites in the Zanzibar in June 2024.
In Lesotho, the NRA (‘LCA’) has found Vodacom Lesotho in
contravention of rule 6(a)(i) of the Quality of Service Rules, 2023 for
the four hours network outages experienced on 16 June 2023. The
LCA issued a fine of Maloti 1.0 million, but suspended execution of the
fine for a period of 12 months, on condition that Vodacom Lesotho
does not commit a similar contravention within that period. A recent
network outage experienced in February 2024 by Vodacom was due
to a fiber cut resulting from ongoing municipal construction work.
Vodacom has reported the root cause of the outage to the LCA.
Networks and access
In Turkey, Türk Telekom’s reference offer regarding fibre access was
approved by the NRA in June 2023, three years after the market
analysis obligating fibre access. As expected, due to macroeconomic
conditions, port and transmission prices have been increased by 70%
effective as of 1 July 2023 within the offer, as well as an increase on
the one-time fees. Vodafone Turkey continuously engages with
relevant stakeholders and considers all remedies to ensure better
access conditions are provided. We are also planning to conduct a
workshop with BTK as a part of their continuing engagements to
convey their key asks regarding fixed access competition, access and
deployment issues. At the same time, Vodafone Turkey has taken the
decision to court, and the legal proceedings are ongoing.
In Tanzania, the NRA (‘TCRA’) completed the market review study to
update the Interconnection Rates Determination No.5/2017 to
determine mobile termination rates that expired in December 2022.
On 14 July 2023, the TCRA published a notice setting a new glidepath
for MTRs for the next four years to 2027, to be applied retrospectively
from 1 January 2023. The new glidepath is as follows: TZS 1.86 for
2023; TZS 1.76 for 2024; TZS 1.68 for 2025; TZS 1.60 for 2026; and
TZS 1.52 for 2027. The glide-path represents an average decline of
5% per annum up to 2028.
In Egypt, Vodafone Egypt is in the process of shutting down 3G
technology by end of 2026. The NRA (‘NTRA’) will define an industry
3G shutdown roadmap in line with Vodafone Egypt’s own roadmap.
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Mobile termination rates (‘MTRs’)1
Country by Region
2020
2021
2022
2023
2024
Europe
Germany (Eurocents)
0.90
0.78
0.55
0.40
0.20
Italy (Eurocents)
0.76
0.67
0.55
0.40
0.20
UK (Great British Pound pence)
0.48
0.47
0.38
0.39
0.44
Spain (Eurocents)
0.64
0.64
0.55
0.40
0.20
Ireland (Eurocents)
0.55
0.43
0.43
0.40
0.20
Portugal (Eurocents)
0.39
0.36
0.36
0.36
0.20
Romania (Eurocents)
0.76
0.76
0.55
0.40
0.20
Greece (Eurocents)
0.62
0.62
0.55
0.40
0.20
Czech Republic (Czech Koruna)
0.25
0.25
0.14
0.10
0.05
Albania (Albanian Lek)
1.11
1.11
1.11
1.11
1.11
Africa
Vodacom: South Africa (South African Rand)
0.10
0.09
0.09
0.09
0.09
Vodacom: Democratic Republic of Congo (U.S. Dollar)
2.00
2.00
2.00
1.50
1.50
Lesotho (Lesotho Loti)
0.12
0.09
0.09
0.09
0.09
Mozambique (Mozambican Metical)
0.37
0.31
0.25
0.18
0.12
Tanzania (Tanzanian Shillings)
5.20
2.60
2.00
1.86
1.78
Turkey (Turkish Lira)
0.03
0.03
0.02
0.02
0.02
Egypt (Egyptian Piastres)
11.00
11.00
11.00
11.00
11.00
Ethiopia (Ethiopian Birr)
-
-
-
-
0.31
Kenya (Kenya Shilling)
0.99
0.99
0.99
0.58
0.41
Note:
1. All MTRs are based on end of financial year values.
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Overview of spectrum licences at 31 March 2024
700MHz
800Mhz
900Mhz
1400/1500Mhz
1800MHz
2.1GHz
2.3 GHz
2.6GHz
3.5GHz
Quantity1 (Expiry
Date)
Quantity1 (Expiry
Date)
Quantity1 (Expiry
Date)
Quantity1 (Expiry
Date)
Quantity1 (Expiry
Date)
Quantity1 (Expiry
Date)
Quantity1
(Expiry Date)
Quantity1 (Expiry Date)
Quantity1 (Expiry
Date)
Germany
2x10 (2033) 2x10 (2025)
2x10(2033)
20 (2033) 2x25 (2033)
2x152 (2040)
n/a 2x20+25 (2025)
90 (2040)
2x52,3 (2025)
Italy17
2x10 (2037)
2x10(2029)
2x10 (2029)
20 (2029) 2x15 (2029)
2x15 (2029)
n/a
2x15 (2029)
80 (2037)
2x53 (2029)
UK4
n/a 2x10 (2033)
2x17.4
20
2x5.8
2x14.8
n/a 2x20+25 (2033)
50 (2038)
40 (2041)3,5
Spain17
2X10 (2061)6 2x10 (2031)
2x10 (2028)
n/a 2x20 (2030)
2x15+5
(2030)
n/a
2x20+20
(2030)
90 (2038)
Ireland
2X10 (2042) 2x10 (2030)
2x10 (2030)
n/a 2x25 (2030)
2X20 (2042)
n/a 2x35 + 30 (2042) 1057 (2032)
Portugal
2X10 (2041) 2x10 (2027)
2x5 (2033)
n/a
2x6 (2033)
2x20 (2033)
n/a
2x20+25
(2027)
90 MHz
(2041)
2x53 (2027)
2x143 (2027)
Romania
2X5 MHz
(2047) 2x10 (2029)
2x10 (2029)
n/a 2x30 (2029)
2x15 (2031)
n/a
n/a
100
(2047)3,8
Greece17
2x10 (2036) 2x10 (2030)
2x15 (2027)
n/a 2x10 (2026)
2x20 (2036)
n/a 2x20+20 (2030)
140 (2036)
2x153 (2035)
Czech
Republic
2x10 (2036) 2x10 (2029)
2x10 (2029)
n/a 2x27 (2029)
2x20 (2041)9
n/a
2x20 (2029)
100
(2032)10
Albania11
n/a 2x10 (2034)
2x8 (2031)
n/a 2x7.2(2034)
2x5 (2026)
n/a 2x20+20 (2030)
n/a
2x1.83 (2030)
2x14.43
(2030)
2x15+53
(2025)
2x203 (2031)
2x43 (2024)
2x93 (2031)
2x53 (2029)
2x93 (2024)
2x53 (2031)
South Africa12
2x10 (2042)
n/a
2x1113 (2029)
n/a
2x12
2x1513
n/a
80 (2042)
10 (2042)
Democratic
Republic of
Congo
2x10 (2038) 2x10 (2038)
2x6 (2038)
n/a
2x17.8
(2038)
2x10+15
(2032)
n/a
30 (2038)
2x15+30
(2026)
Lesotho
n/a
2x2014
2x22.214
n/a
2x30.214
2x2014
n/a
n/a
10014
(2036)
Mozambique
n/a 2x10 (2039)
2x7.8 (2039)
n/a 2x20 (2039)
2x15+5
(2039)
n/a
n/a 6015 (2024)
2x53, 15 (2027)
Tanzania
2x20 (2033)
n/a 2x12.5 (2033)
n/a 2x10 (2033)
2x15 (2033) 70 (2037)
25 (2037)
40 (2031)
Turkey
n/a 2x10 (2029) 2x11 (2029)16
n/a 2x10 (2029)
2x15+5
(2029)
n/a 2x15+10 (2029)
n/a
2x1.43 (2029)
Egypt
n/a
n/a 2x12.5 (2031)
n/a 2x10 (2031)
2x20 (2031)
n/a
40 (2031)
n/a
Notes:
1. All: Single (or unpaired) blocks of spectrum are used for asymmetric data (non-voice) use; block quantity has been rounded to the nearest whole number. Most of the radio spectrum in this table is
organised as paired spectrum - a block of spectrum in a lower frequency band and an associated block of spectrum in an upper frequency band. Where the radio spectrum is specified in the form
“2x10 MHz” it represents 10 MHz in a lower band and 10 MHz in an upper band. Where this is followed by “+25”, this idicates it is an unpaired, standalone, spectrum.
2. Germany: The allocation of 2.1GHz will change to the following: At present we have 2x15 MHz (2040) and 2x5 (2025); in January 2026 will have 2x20 MHz (2040).
3. Multiple: Blocks within the same spectrum band but with different licence expiry dates are separately identified
4. UK: All UK spectrum licences are perpetual so any dates given are the ones from which licence fees become payable, and where no date is given this means that licence fees already apply.
5. UK: Currently in the transition period of the 3.4-3.8 GHz defragmentation deal with VMO2. Once the transition is completed in 2025, Vodafone will have 90 MHz with an expiry date of 2038.
6. Spain: The initial term of the licence is 20 years, with the option to renew the licence for an additional 20 years as long as the licence conditions have been met.
7. Ireland: 105MHz in cities, 85MHz in regions.
8. Romania: 100 MHz 3.5 GHz licence to start upon expiry of the original 40 MHz licence
9. Czech Republic: Early extension to the 2.1 GHz licence achieved in 2022, extending the term of the original licence from 2025 to 2041
10. Czech Republic: Includes 40 MHz acquired from PODA, with same licence duration as the other 60 MHz
11. Albania: As part of the merger remedies from the ONE-ALBtelecom merger, Vodafone acquirde the following spectrum from the merged entity effective May 1st 2023: 2X4.5 MHz of 1800 MHz
expiring June 2024; 2X7.2 MHz of 1800 MHz expiring March 2034; 2X5 MHz of 2.1 GHz expiring June 2026; and 2X20 MHz of 2.6 GHz expiring May 2031
12. South Africa: Under South Africa’s licensing regime, Vodacom has been assigned a network and service operating licence. This operating licence permits Vodacom to be assigned spectrum licences
which are valid for the duration of the operating licence, subject to annual renewal through the payment of annual spectrum usage regulatory fees. Vodacom’s operating licence will expire in 2029.
13. South Africa: South African Regulator has indicated that it has approved Vodacom’s 2100MHz license amendment which effectively returns the 2100TDD spectrum.
14. Lesotho: Vodacom’s Lesotho spectrum licences are attached to a unified services license and renewed annually.
15. Mozambique: 3.5GHz spectrum for 5G trial which was extended to 2024. 2x5 of 2.1GHz and 2x5 of 1800MHz have been acquired for 5 years expirying in 2028. A further 2x2MHz of 900MHz was also
acquired expiring in line with the overall unified license.
16. Turkey: Extension of 2X11 MHz licence up to April 30, 2029 was completed on April 18, 2023. Licence extension Protocol is subject to Council of State’s opinion which is pending
17. Multiple: We currently hold mmWave 26 GHz licences in Italy, Spain and Greece
Regulation (continued)
Unaudited information
260
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Other information
Form 20-F cross reference guide
The information in this document that is referenced in the following table will be included in our Annual Report on Form 20-F for 2024 filed with
the SEC (the ‘2024 Form 20-F’). The information in this document will be updated and supplemented at the time of filing with the SEC or later
amended if necessary. No other information in this document is included in the 2024 Form 20-F or incorporated by reference into any filings by
us under the Securities Act. Please see ‘Documents on display’ on page 252 for information on how to access the 2024 Form 20-F as filed with the
SEC. The 2024 Form 20-F has not been approved or disapproved by the SEC nor has the SEC passed judgement upon the adequacy or accuracy
of the 2024 Form 20-F.
Item
Form 20-F caption
Location in this document
Page
1
Identity of Directors, senior management
and advisers
Not applicable
-
2
Offer statistics and expected timetable
Not applicable
-
3
Key information
3B Capitalisation and indebtedness
Not applicable
-
3C Reasons for the offer and use of proceeds
Not applicable
-
3D Risk factors
Principal risk factors and uncertainties
57 to 62
4
Information on the Company
4A History and development of the Company
History and development
255
Contact details
Back cover
Shareholder information: Contact details for Equiniti and EQ Shareholder
Services
249
Shareholder information: Articles of Association and applicable English law
250
Note 1 ‘Basis of preparation’
139 to 147
Note 2 ‘Revenue disaggregation and segmental analysis’
148 to 151
Note 7 ‘Discontinued operations and assets held for sale’
164 to 167
Note 11 ‘Property, plant and equipment’
171 to 172
Note 27 ‘Acquisitions and disposals’
210 to 211
Note 28 ‘Commitments’
212
Documents on display
252
4B Business overview
About Vodafone
2
Operating in a rapidly changing industry
3
Key performance indicators
6 to 7
Chair’s message
8
Chief Executive’s statement and strategic roadmap
9
Mega trends
10 to 11
Our financial performance
21 to 31
Purpose, sustainability and responsible business
32 to 56
Note 2 ‘Revenue disaggregation and segmental analysis’
148 to 151
Regulation
255 to 258
4C Organisational structure
Note 31 ‘Related undertakings’
217 to 225
Note 12 ‘Investments in associates and joint arrangements’
173 to 180
Note 13 ‘Other investments’
181
4D Property, plant and equipment
Note 11 ‘Property, plant and equipment’
171 to 172
4A
Unresolved staff comments
None
-
5
Operating and financial review and prospects
5A Operating results
Our financial performance
21 to 31
Cyber security
46 to 51
Note 21 ‘Borrowings’
190 to 191
Regulation
255 to 258
5B Liquidity and capital resources
Our financial performance: Cash flow, capital allocation and funding
29 to 31
Long-term viability statement
63
Directors’ statement of responsibility: Going concern
124
Note 19 ‘Cash and cash equivalents’
186
Note 21 ‘Borrowings’
190 to 191
Note 22 ‘Capital and financial risk management’
192 to 201
Note 28 ‘Commitments’
212
5C Research and development,
patents and licences etc.
Note 10 ‘Intangible assets’
169 to 170
Regulation: Overview of spectrum licences
260
5D Trend information
Key performance indicators
6 to 7
Mega trends
10 to 11
Long-term viability statement
63
5E Critical accounting estimates
Note 1 ‘Basis of preparation’
139 to 147
261
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Governance
Financials
Other information
Item
Form 20-F caption
Location in this document
Page
6
Directors, senior management and employees
6A Directors and senior management
Our Board
76 to 78
Our governance structure
74
Our Executive Committee
79
Division of responsibilities
75
6B Compensation
Annual Report on Remuneration: 2024 Remuneration
106 to 118
Remuneration Policy
100 to 105
Note 23 ‘Directors and key management compensation’
202
6C Board practices
Our Board
76 to 78
Our governance structure
74
Division of responsibilities
75
Board activities and principal decisions
81 to 83
Nominations and Governance Committee
86 to 88
Audit and Risk Committee
89 to 94
Technology Committee
95
ESG Committee
96 to 97
Remuneration Committee
98 to 99
Remuneration policy
100 to 105
Shareholder information: Articles of Association and applicable English law
250
6D Employees
Our people strategy
15 to 20
Note 24 ‘Employees’
203
6E Share ownership
Annual Report on Remuneration: 2024 Remuneration
106 to 118
Remuneration Policy
100 to 105
All-employee share plans
110
Note 26 ‘Shared-based payments’
208 to 209
6F Disclosure of a registrants action to recover
erroneously awarded compensation
Not applicable
-
7
Major shareholders and related party transactions
7A Major shareholders
Shareholder information: Major shareholders
250
7B Related party transactions
Annual Report on Remuneration: 2024 Remuneration
106 to 118
Note 13 ‘Other investments’
181
Note 23 ‘Directors and key management compensation’
202
Note 29 ‘Contingent liabilities and legal proceedings’
212 to 216
Note 30 ‘Related party transactions’
216
7C Interests of experts and counsel
Not applicable
-
8
Financial information
8A Consolidated statements and other
financial information
Consolidated financial statements
135 to 226
Report of independent registered public accounting firm
-
Note 29 ‘Contingent liabilities and legal proceedings’
212 to 216
Dividend rights
251
8B Significant changes
Not applicable
-
9
The offer and listing
9A Offer and listing details
Shareholder information
249 to 254
9B Plan of distribution
Not applicable
-
9C Markets
Shareholder information: Rights attaching to the Company’s shares
251
9D Selling shareholders
Not applicable
-
9E Dilution
Not applicable
-
9F Expenses of the issue
Not applicable
-
10
Additional information
10A Share capital
Note 17 ‘Called up share capital’
185
10B Memorandum and Articles of Association
Shareholder information
249 to 254
Description of securities registered
-
10C Material contracts
Shareholder information: Material contracts
252
10D Exchange controls
Shareholder information: Exchange controls
252
10E Taxation
Shareholder information: Taxation
252 to 254
10F Dividends and paying agents
Note 9 ‘Equity dividends’
168
Shareholder information
249 to 254
10G Statements by experts
Not applicable
-
10H Documents on display
Shareholder information: Documents on display
252
10I Subsidiary information
Note 31 ’Related undertakings’
217 to 225
10J Annual Report to security holders
Not applicable
-
Form 20-F cross reference guide (continued)
262
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Strategic report
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Financials
Other information
Item
Form 20-F caption
Location in this document
Page
11
Quantitative and qualitative disclosures about
market risk
Note 22 ‘Capital and financial risk management’
192 to 201
12
Description of securities other than equity securities
12A Debt securities
Not applicable
-
12B Warrants and rights
Not applicable
-
12C Other securities
Not applicable
-
12D American depositary shares
Fees payable by ADR holders
-
13
Defaults, dividend arrearages and delinquencies
Not applicable
-
14
Material modifications to the rights of security
holders and use of proceeds
Not applicable
-
15
Controls and procedures
Governance
70 to 121
Directors’ statement of responsibility: Controls over financial reporting
124
Report of independent registered public accounting firm
-
16
Reserved
16A Audit Committee financial expert
Board Committees
86 to 99
16B Code of ethics
Our US listing requirements
119
16C Principal accountant fees and services
Note 3 ‘Operating profit’
152
Board Committees: Audit and Risk Committee: External audit
94
16D Exemptions from the listing standards
for audit committees
Not applicable
-
16E Purchase of equity securities by the issuer
and affiliated purchasers
Share buybacks
31
16F Change in registrant’s certifying accountant
Not applicable
-
16G Corporate governance
Our US listing requirements
119
16H Mine safety disclosure
Not applicable
-
16I Disclosure regarding foreign jurisdictions that
prevent inspections
Not applicable
-
16J Insider trading policies
Index to Exhibits
-
16K (b) Cybersecurity
Cyber security: Strategy
46 to 47
Cyber security: Risk management
47 to 48
Cyber security: Threats and incidents
50 to 51
16K (c) Cybersecurity
Cyber security: Operating model
48 to 49
17
Financial statements
Consolidated financial statements
135 to 226
18
Financial statements
Consolidated financial statements
135 to 226
Report of independent registered public accounting firm
-
19
Exhibits
Index to Exhibits
-
263
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Financials
Other information
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. In particular, such forward looking
statements include, but are not limited to, statements with respect to:
– the Group’s portfolio transformation plan;
– expectations regarding the Group’s financial condition or results of
operations and the guidance for Adjusted EBITDAaL and Adjusted
free cash flow for the financial year ending 31 March 2025;
– the announced agreement to combine Vodafone UK and Three UK;
the announced agreements to dispose of Vodafone Spain and
Vodafone Italy;
– changes to German TV laws and the migration of users to individual TV
customer contracts; expectations for the Group’s future performance
generally; the transaction to purchase Nowo Communications; the
Group’s strategic partnership with Microsoft;
– climate change, including emissions targets and other ESG goals,
commitments, targets and ambitions, climate-related scenarios
or pathways and methodologies we use to assess our progress
in relation to these;
– the digital transformation of the Group’s business customers; the
Group’s partnership with DCC in the UK; expectations regarding the
operating environment and market conditions and trends,
including customer usage, competitive position and macroeconomic
pressures, price trends and opportunities in specific geographic
markets; intentions and expectations regarding the development,
launch and expansion of products, services and technologies, either
introduced by Vodafone or by Vodafone in conjunction with third
parties or by third parties independently;
– expectations regarding the integration or performance of current
and future investments, associates, joint ventures, non-controlled
interests and newly acquired businesses;
– the impact of regulatory and legal proceedings involving the Group
and of scheduled or potential regulatory changes; certain of the
Group’s plans and objectives, including the Group’s strategy.
Forward-looking statements are sometimes but not always identified
by their use of a date in the future or such words as ‘will’, ‘may’, ‘expects’,
‘believes’, ‘intends’, ‘plans’, ‘further’, ‘ongoing’, ‘anticipates’, ‘could’, 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:
– general economic and political conditions in the jurisdictions in
which the Group operates and changes to the associated legal,
regulatory and tax environments; increased competition;
– levels of investment in network capacity and the Group’s ability to
deploy new technologies, products and services, including artificial
intelligence;
– the Group’s ability to optimise its portfolio in line with its business
transformation plan;
– evolving cyber threats to the Group’s services and confidential data;
– the Group’s ability to embed responses to climate-related risks into
business strategy and operations;
– rapid changes to existing products and services and the inability of
new products and services to perform in accordance with expectations;
– the ability of the Group to integrate new technologies, products and
services with existing networks, technologies, products and services;
– the Group’s ability to generate and grow revenue; slower than
expected impact of new or existing products, services or
technologies on the Group’s future revenue, cost structure and
capital expenditure outlays; slower than expected customer growth,
reduced customer retention, reductions or changes in customer
spending and increased pricing pressure;
– the Group’s ability to extend and expand its spectrum resources, to
support ongoing growth in customer demand for mobile data services;
– the Group’s ability to secure the timely delivery of high-quality
products from suppliers; loss of suppliers, disruption of supply
chains, shortages and greater than anticipated prices of new mobile
handsets;
– changes in the costs to the Group of, or the rates the Group may
charge for, terminations and roaming minutes;
– the impact of a failure or significant interruption to the Group’s
telecommunications, data centres, networks, IT systems or data
protection systems;
– the Group’s ability to realise expected benefits from acquisitions,
partnerships, joint ventures, associates, franchises, brand licences,
platform sharing or other arrangements with third parties, including
the signed agreement to combine Vodafone’s UK business with
Three UK and the Group’s strategic partnership with Microsoft;
– acquisitions and divestments of Group businesses and assets and
the pursuit of new, unexpected strategic opportunities;
– the Group’s ability to integrate acquired business or assets; the extent of
any future write-downs or impairment charges on the Group’s assets, or
restructuring charges incurred as a result of an acquisition or disposition;
– developments in the Group’s financial condition, earnings and
distributable funds and other factors that the Board takes into
account in determining the level of dividends;
– the Group’s ability to satisfy working capital requirements;
– changes in foreign exchange rates;
– changes in the regulatory framework in which the Group operates;
– the impact of legal or other proceedings against the Group or other
companies in the communications industry; and changes in statutory tax
rates and profit mix, including the disposals of Vodafone Spain and
Vodafone Italy;
– climate change projection risk including, for example, the evolution
of climate change and its impacts, changes in the scientific assessment
of climate change impacts, transition pathways and future risk
exposure and limitations of climate scenario forecasts; amendments to
or new ESG reporting standards, models or methodologies;
– changes in ESG data availability and quality which could result in
revisions to reported data going forward; and climate scenarios and
the models that analyse them have limitations that are sensitive to
key assumptions and parameters, which are themselves subject to
some uncertainty.
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 ‘Principal risk factors and
uncertainties’ on pages 57 to 62 of this document. All subsequent written
or oral forward-looking statements attributable to Vodafone or any
member of the Vodafone Group or any persons acting on their behalf are
expressly qualified in their entirety by the factors referred to above. No
assurances can be given that the forward-looking statements in this
document will be realised. Subject to compliance with applicable law and
regulations, Vodafone does not intend to update these forward-looking
statements and does not undertake any obligation to do so.
References in this document to information on websites, including
other supporting disclosures located thereon such as videos, our ESG
Addendum, our Climate Transition Plan and/or social media sites are
included as an aid to their location and such information is not
incorporated in, and does not form part of the 2024 Annual Report on
Form 20-F.
Ernst & Young LLP has neither examined, compiled, nor performed
any procedures with respect to the forward-looking statements.
Accordingly, Ernst & Young LLP does not express an opinion or
provide any other form of assurance on such information.
Forward-looking statements
Unaudited information
264
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Other information
The definitions of non-GAAP measures are included in the ‘Non-GAAP measures’ section on pages 235 to 247.
3G
A cellular technology based on wideband code division multiple access delivering voice and faster data services.
4G
4G or long-term evolution (‘LTE’) technology offers faster data transfer speeds than 3G.
5G
5G is the fifth-generation wireless broadband technology which provides better speeds and coverage than 4G.
ADR
American depositary receipts is a mechanism designed to facilitate trading in shares of non-US companies on the US
stock markets. The main purpose is to create an instrument which can easily be settled through US stock market
clearing systems.
ADS
American depositary shares are shares evidenced by American depositary receipts. ADSs are issued by a depositary
bank and represent one or more shares of a non-US issuer held by the depositary bank. The main purpose of ADSs is to
facilitate trading in shares of non-US companies in the US markets and, accordingly, ADRs which evidence ADSs are in
a form suitable for holding in US clearing systems.
Africa
Comprises the Vodacom Group (including Vodafone Egypt).
AGM
Annual General Meeting.
Applications (‘apps’)
Apps are software applications usually designed to run on a smartphone or tablet device and provide a convenient
means for the user to perform certain tasks. They cover a wide range of activities including banking, ticket purchasing,
travel arrangements, social networking and games. For example, the MyVodafone app lets customers check their bill
totals on their smartphone and see the minutes, texts and data allowance remaining.
ARPU
Average revenue per user, defined as customer revenue and incoming revenue divided by average customers.
B2C
Business-to-Consumer refers to the process of selling products and services directly between a business and
consumers who are the end-users.
Capital additions
Comprises the purchase of property, plant and equipment and intangible assets, other than licence and spectrum
payments and integration capital expenditure.
Churn
Total gross customer disconnections in the period divided by the average total customers in the period.
Cloud services
This means the customer has little or no equipment, data and software at their premises. The capability associated with
the service is run from the Vodafone network and data centres instead. This removes the need for customers to make
capital investments and instead they have an operating cost model with a recurring monthly fee.
CO2e
CO2e, or Carbon dioxide equivalent, is a term for describing different greenhouse gases in a common unit. For any quantity
and type of greenhouse gas, CO2e signifies the amount of CO2 which would have the equivalent global warming impact.
Common Functions
Comprises central teams and business functions.
Converged customer
A customer who receives fixed and mobile services (also known as unified communications) on a single bill or who
receives a discount across both bills.
Depreciation and amortisation
The accounting charge that allocates the cost of tangible or intangible assets, whether owned or leased, to the income
statement over its useful life. The measure includes the profit or loss on disposal of property, plant and equipment,
software and leased assets.
Eliminations
Refers to the removal of intercompany transactions to derive the consolidated financial statements.
Europe
Comprises the Group’s European businesses and the UK.
FCA
Financial Conduct Authority.
Financial services revenue
Financial services revenue includes fees generated from the provision of advanced airtime, overdraft, financing and
lending facilities, as well as merchant payments and the sale of insurance products (e.g. device insurance, life insurance
and funeral cover).
Fixed service revenue
Service revenue (see overleaf) relating to the provision of fixed line and carrier services.
Fibre to the cabinet (‘FTTC’)
Involves running fibre optic cables from the telephone exchange or distribution point to the street cabinets which then
connect to a standard phone line to provide broadband.
Fibre to the home (‘FTTH’)
Provides an end-to-end fibre optic connection the full distance from the exchange to the customer’s premises.
GAAP
Generally Accepted Accounting Principles.
GSMA
Global System for Mobile Communications Association.
ICT
Information and Communications Technology.
IFRS
International Financial Reporting Standards.
Incoming revenue
Comprises revenue from termination rates for voice and messaging to Vodafone customers.
Integration capital additions
Capital additions incurred in relation to significant changes in the operating model, such as the integration of recently
acquired subsidiaries.
Internet of Things (‘IoT’)
The network of physical objects embedded with electronics, software, sensors, and network connectivity, including
built-in mobile SIM cards, that enables these objects to collect data and exchange communications with one another
or a database.
LTM
Last twelve months.
Mark-to-market
Mark-to-market or fair value accounting refers to accounting for the value of an asset or liability based on the current
market price of the asset or liability.
Definition of terms
Unaudited information
265
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Other information
Mbps
Megabits (millions) of bits per second.
MDU
Multi-Dwelling Unit.
Mobile broadband
Mobile broadband allows internet access through a browser or a native application using any portable or mobile device
such as smartphone, tablet or laptop connected to a cellular network.
Mobile service revenue
Service revenue (see below) relating to the provision of mobile services.
Mobile termination rate (‘MTR’)
A per minute charge paid by a telecommunications network operator when a customer makes a call to another mobile
or fixed network operator.
Mobile virtual network operator
(‘MVNO’)
Companies that provide mobile phone services under wholesale contracts with a mobile network operator, but do not
have their own licence or spectrum or the infrastructure required to operate a network.
MSME
Micro, Small and Medium sized Enterprises.
Next-generation networks (‘NGN’) Fibre or cable networks typically providing high-speed broadband.
Net Promoter Score (‘NPS’)
Net Promoter Score is a customer loyalty metric used to monitor customer satisfaction.
Operating expenses
Comprise primarily sales and distribution costs, network and IT-related expenditure and business support costs.
Other Europe
Other Europe comprises Portugal, Ireland, Greece, Romania, Czech Republic and Albania. The prior period comparative
results include Vodafone Hungary which was disposed of in January 2023.
Other revenue
Other revenue principally includes equipment revenue, interest income, income from partner market arrangements
and lease revenue, including in respect of the lease out of passive tower infrastructure.
Partner markets
Markets in which the Group has entered into a partner agreement with a local mobile operator enabling a range of
Vodafone’s global products and services to be marketed in that operator’s territory and extending Vodafone’s reach
into such markets.
Penetration
Number of SIMs in a country as a percentage of the country’s population. Penetration can be in excess of 100% due to
customers owning more than one SIM.
Petabyte
A petabyte is a measure of data usage. One petabyte is a million gigabytes.
Pps
Percentage points.
RAN
Radio access network is the part of a mobile telecommunications system which provides cellular coverage to mobile
phones via a radio interface, managed by thousands of base stations installed on towers and rooftops across the coverage
area, and linked to the core nodes through a backhaul infrastructure which can be owned, leased or a mix of both.
Reported growth
Reported growth is based on amounts reported in euros and determined under IFRS.
Restructuring costs
Costs incurred by the Group following the implementation of discrete restructuring plans to improve overall efficiency.
Retail service revenue
Retail service revenue comprises Service revenue excluding Mobile Virtual Network Operator (‘MVNO’) and Fixed Virtual
Network Operator (‘FVNO’) wholesale revenue.
Return on capital employed (‘ROCE’) Return on capital employed reflects how efficiently we are generating profit with the capital we deploy.
Revenue
The total of Service revenue (see below) and Other revenue (see above).
Roaming
Roaming allows customers to make calls, send and receive texts and data on our and other operators’ mobile networks,
usually while travelling abroad.
SD-WAN
Software-Defined Wide Area Network.
Service revenue
Service revenue is all revenue related to the provision of ongoing services to the Group’s consumer and enterprise
customers, together with roaming revenue, revenue from incoming and outgoing network usage by non-Vodafone
customers and interconnect charges for incoming calls.
SME
Small and Medium sized Enterprises.
SoHo
Small office / Home office.
Spectrum
The radio frequency bands and channels assigned for telecommunication services.
Task Force on Climate-related
Financial Disclosures (‘TCFD’)
TCFD is a global framework for companies and other organisations to develop more effective climate-related financial
disclosures through their existing reporting processes.
Vodafone Business
Vodafone Business supports organisations in a digital world. With Vodafone’s expertise in connectivity, our leading IoT
platform and our global scale, we deliver the results that organisations need to progress and thrive. We support
businesses of all sizes and sectors.
Vodafone Procurement Company
(‘VPC’)
VPC is Vodafone’s procurement company, leading purchasing and supplier management for Vodafone as a whole.
Based in Luxembourg, VPC manages most of Vodafone’s spending with suppliers worldwide. VPC supports the needs of
Vodafone’s operating companies and group functions, and sells procurement services to third parties.
_VOIS
_VOIS (Vodafone Intelligent Solutions) has grown from a single entity service provider to a global purpose-driven
company that provides a comprehensive portfolio of services to Vodafone and other telecommunications operators
throughout the world.
WACC
Weighted average cost of capital.
Definition of terms (continued)
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Notes
267
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Notes
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References to Vodafone are to Vodafone Group Plc and references to Vodafone Group are to Vodafone Group Plc and its subsidiaries
unless otherwise stated. Vodafone, the Vodafone Speech Mark Devices, Vodacom and Together We Can are trade marks owned by Vodafone.
The Vantage Towers Logo and the VT Monogram Logo are trade marks owned by Vantage Towers AG. Other product and company names
mentioned herein may be the trade marks of their respective owners.
This report contains references to Vodafone’s website, and other supporting disclosures located thereon such as videos, our ESG Addendum and
methodology document, and our cyber security factsheet, amongst others. These references are for readers’ convenience only and information
included on Vodafone’s website is not incorporated in, and does not form part of, this Annual Report or our Annual Report on Form 20-F.
© Vodafone Group 2024
Consultancy and design by Black Sun Global
www.blacksun-global.com
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Newbury
Berkshire
RG14 2FN
England
Registered in England
No. 1833679
Telephone
+44 (0)1635 33251
vodafone.com
Contact details
Shareholder helpline
Telephone
+44 (0)371 384 2532
Investor Relations
ir@vodafone.co.uk
vodafone.com/investor
Media Relations
vodafone.com/media/contact
Sustainability
vodafone.com/sustainability
Online Annual Report
vodafone.com/ar2024