Interim Results - Part 1

Vodafone Group Plc
18 November 2003







VODAFONE GROUP PLC                               Embargo:
INTERIM RESULTS FOR THE                          Not for publication
SIX MONTHS TO 30 SEPTEMBER 2003                  before 07:00 hours
                                                 18 November 2003

• Turnover increased by 13% to £16.9 billion.

• Profit before tax, goodwill amortisation and exceptional items,
  increased by 26% to £5.4 billion.

• Earnings per share, before goodwill amortisation and exceptional items,
  increased by 46% to 4.78 pence.

• Loss for the financial period of £4.3 billion, after goodwill
  amortisation of £7.7 billion.

• Free cash flow increased by 61% to £4.6 billion, after £2.2 billion of
  tangible capital expenditure.

• Dividend per share increased by 20% to 0.9535p.

• £2.5 billion allocated to share repurchase programme.


Arun Sarin, Chief Executive, commented:

Vodafone has delivered outstanding results for the first six months, in a
challenging, competitive marketplace. We have passed the milestone of 125
million proportionate customers and produced strong, double-digit growth in
turnover and EBITDA and significant growth in free cash flow. We are
substantially increasing cash returns to shareholders, increasing the interim
dividend by 20% and allocating £2.5 billion to a share buy back programme.

The Group is in an industry leading position to benefit from further growth in
telecommunications as well as the adjacent industries of information technology,
content and entertainment. We are leveraging our scale, scope and brand in these
areas. I am confident that Vodafone is strategically, operationally and
financially well positioned to deliver continued success in the future.

Julian Horn-Smith, Group Chief Operating Officer, commented:

These results show an excellent performance by the Group on the key operating
variables of proportionate customer growth, EBITDA margin before exceptional
items and free cash flow. We are confident that we have the best products and
services and the right structure, platforms and focus as we enter the exciting
period of transition to our 3G networks in a number of markets over the next
twelve months. We look forward to rolling out this technological transformation
and to delighting our customers with the benefits it will bring.

GROUP FINANCIAL HIGHLIGHTS

Statutory                                            Six months to
                                                     30 September
                                                    2003       2002   % change
                                                      £m         £m

Turnover                                          16,899     14,898         13

Group EBITDA, before exceptional items             6,618      5,566         19

Total Group operating profit before goodwill
amortisation and exceptional items                 5,722      4,640         23

Profit on ordinary activities before taxation,
goodwill amortisation and exceptional items        5,366      4,250         26
Goodwill amortisation                             (7,651)    (6,837)        12
Exceptional operating items                          351          -          -
Exceptional non-operating items                      (58)       267          -
                                                    -----     -----
Loss on ordinary activities before taxation       (1,992)    (2,320)       (14)

Loss for the financial period                     (4,254)    (4,336)        (2)

Proportionate                                        Six months to
                                                     30 September
                                                    2003        2002   % change
                                                      £m          £m
Turnover
- mobile telecommunications                       18,675      15,459        21
- other operations                                 1,017       1,058        (4)
                                                  ------      ------
                                                  19,692      16,517        19

Organic growth at constant exchange rates                                   10

EBITDA before exceptional items
- mobile telecommunications                       7,570        6,027        26
- other operations                                  222          176        26
                                                  ------       ------
                                                  7,792        6,203        26

Organic growth at constant exchange rates                                   15
Proportionate information is calculated on the basis described on page 31.


Cash flow information                                Six months to
                                                     30 September
                                                   2003        2002   % change
                                                     £m          £m
Net cash inflow from operating activities         6,081       5,676          7

Free cash flow                                    4,641       2,878         61

Net debt at 30 September                        (10,906)    (10,697)         2


Per share information                               Six months to
                                                     30 September
                                                   2003        2002   % change

Earnings/(loss) per share
- before goodwill amortisation and exceptional
  items                                             4.78p       3.28p       46
- after goodwill amortisation and exceptional
  items                                           (6.24)p     (6.36)p       (2)

Dividend per share                                0.9535p     0.7946p       20

This results announcement contains certain information on the Group's results
and cash flows that have been derived from amounts calculated in accordance with
UK Generally Accepted Accounting Principles, ('UK GAAP'), but are not themselves
UK GAAP measures. They should not be viewed in isolation as alternatives to the
equivalent UK GAAP measure and should be read in conjunction with the equivalent
UK GAAP measure. Further disclosures are also provided under 'Use of Non-GAAP
Financial Information' on page 35.

GROUP OPERATING HIGHLIGHTS

• Organic growth of 5.7 million proportionate customers since 31 March 2003.
  Worldwide proportionate customer base increased to 125.3 million at 30 
  September 2003. Venture customer base increased to 314.0 million.

• Controlled ARPU stable on a constant currency basis. ARPU was up 2.3% and 1.7%
  in Italy and the UK respectively, stable in Germany and down 2.7% in Japan
  compared to the year ended 31 March 2003.

• Voice usage increased by 12% in the Group's controlled businesses, from 68.5
  billion minutes for the six months ended 30 September 2002 to 76.7 billion
  minutes for the six months ended 30 September 2003.

• Usage of data services has continued to increase, with revenues from data
  services increasing by 29% over the comparable period to £2,186 million.

• Data revenues represented 15.5% of service revenues for the twelve months to
  30 September 2003 compared to 14.6% for the year ended 31 March 2003.

• Mobile business proportionate EBITDA margin, before exceptional items, up by
  1.5 percentage points to 40.5%, compared to the six months ended 30 September
  2002. Group proportionate EBITDA margin, before exceptional items, of 39.6%,
  improved by 2.0 percentage points over the same period.

• Tangible fixed asset additions of £2.1 billion in the period, compared to £2.0
  billion for the six months ended 30 September 2002. Tangible fixed asset
  additions in the mobile businesses represented 12.7% of turnover for the
  period, compared to 13.4% for the six months to 30 September 2002.

VODAFONE LIVE!

• Over 3 million Vodafone live! customers in 15 countries as at 
  13 November 2003.

• Increased quality of Vodafone live! content services, including agreements for
  distribution rights for UEFA Champions League Football, Tomb Raider and
  The Simpsons.

• Launch of Vodafone live! by two of the Group's associated undertakings, SFR on
  29 October 2003 and Swisscom Mobile on 13 November 2003.

OTHER COMMERCIAL INITIATIVES

• Creation of two new central functions, Group Marketing, to drive revenue
  growth, and Group Technology and Business Integration, to drive cost and scale
  benefits.

• Joint announcement with Microsoft on 13 October 2003, of an intention to use
  mobile SIM based authentication and billing to help create open web services
  standards for application developers and mobile operators.

• Joint initiative with Oracle announced on 22 October 2003, to offer enterprise
  customers integrated mobility solutions enabling mobile access to business
  systems.

• Collaboration with Verizon Wireless including the intention of developing a
  jointly branded international data card service.  Other examples of 
  collaboration include international account management, inter-standard 
  GSM/CDMA text messaging between the networks of Vodafone and Verizon Wireless,
  joint global content contracts and ongoing  best practice sharing.

• Partner Networks extended by 3 countries since 31 March 2003 to cover 10
  countries as at 3 November 2003.

• J-Phone Vodafone rebranded to Vodafone on 1 October 2003. All controlled
  networks now operate under the Vodafone brand.

• 127,000 Vodafone Mobile Connect Card customers at 30 September 2003.

Significant Transactions

• Disposal, after 30 September 2003, of the Group's interest in Japan Telecom.
  Receipts from this transaction are Y261.3 billion (£1.4 billion), comprising
  Y228.8 billion (£1.2 billion) of cash and Y32.5 billion (£0.2 billion) of
  transferable redeemable preferred equity.

• Acquisition of UK service providers Project Telecom plc and the Singlepoint
  Group for cash consideration of £155 million and £417 million, respectively.

• Agreements reached with Vivendi Universal on 14 October 2003, increasing
  co-operation in France, including agreement in principle on simplification of
  the Cegetel Group structure and the receipt of quarterly dividends.

OUTLOOK

Please see 'Forward-Looking Statements' on page 34.

For the year ending 31 March 2004

The Group expects full year organic growth in average proportionate mobile
customers to exceed 10%, leading to similar organic growth in proportionate
mobile revenues.

Assuming no significant change to foreign exchange rates, the Group continues to
expect the full year proportionate mobile EBITDA margin to be higher than last
year. However, the second half margin is not expected to be as high as the 40.5%
margin achieved in the first half due to the usual seasonal increase in
competitive activity in many of the Group's markets, the effect of changes in
termination rates and the Group's intention to invest in growth in some of its
markets.

Total capitalised fixed asset additions are expected to be around £5 billion
this year, resulting in a continued improvement in mobile capital efficiency.

Full year free cash flow is expected to be over £7 billion, up from the Group's
previous expectation of more than the £5.2 billion achieved last year. However,
free cash flow is expected to be lower in the second half of the year, due to
the first half inclusion of one-off receipts from hedging instruments, the
operating outlook mentioned above and higher second half tax payments, which are
expected to approach £1.3 billion for the full year.

For the year ending 31 March 2005

Next year, on an organic basis, the Group anticipates high single-digit average
proportionate mobile customer growth, leading to broadly similar growth in
proportionate mobile revenues.

Taking into account the necessary investment and costs associated with opening
3G networks as well as the effects of declines in termination rates, the Group
expects the proportionate mobile EBITDA margin to be stable or modestly ahead
for the full year, which would lead to organic growth in proportionate mobile
EBITDA approaching 10%, assuming no significant change in foreign exchange
rates.

Capitalised fixed asset additions are expected to remain at around £5 billion,
similar to the 2004 financial year.

BUSINESS REVIEW

                                                   Six months to
                                                   30 September
                                               2003            2002   % change
                                                 £m              £m
Turnover
Mobile telecommunications:
- Voice services                             11,882          10,429         14
- Data services                               2,186           1,701         29
                                             -------        -------
- Total service revenue                      14,068          12,130         16
- Equipment and other                         1,485           1,310         13
                                             -------         -------
                                             15,553          13,440         16
Other operations                              1,346           1,458         (8)
                                             -------         -------
                                             16,899          14,898         13

Direct costs*                                (6,453)         (5,594)        15
Operating expenses                           (3,828)         (3,738)         2
Depreciation and amortisation*               (2,263)         (1,962)        15
Share of operating profit in joint
ventures and associated undertakings*         1,367           1,036         32
                                             -------         -------

Total Group operating profit*                 5,722           4,640         23
Goodwill amortisation                        (7,651)         (6,837)        12
Exceptional operating items                     351               -          -
                                             -------         -------
Total Group operating loss                   (1,578)         (2,197)       (28)
                                             -------         -------
* Before goodwill amortisation and exceptional items

Turnover

Turnover increased by 13% for the six months to 30 September 2003, resulting
principally from organic growth of 9%. Changes in exchange rates accounted for
5% of the reported growth due to a stronger Euro, partially offset by a weaker
Yen. Disposals in the prior year reduced growth by 1%.

The increase in turnover from mobile telecommunications was driven by growth in
service revenues as a result of greater usage of voice services, principally due
to organic growth in the customer base, and increased penetration of data
products and services. This was partially offset by the effect of increased
competitive activity and regulatory intervention.

The Group achieved an improvement in ARPU in a number of key markets in Europe,
compared with the twelve month period ended 31 March 2003, as benefits from the
Group's continued focus on high value customers and initiatives to stimulate
usage were realised. Total voice usage in controlled subsidiaries increased by
12% over the comparable period to 76.7 billion minutes for the six months ended
30 September 2003. Vodafone Japan's ARPU fell 2.7%, as penetration levels in
Japan increased towards European levels.

A key driver of the growth in service revenue was the continued success of the
Group's data product and service offerings. Revenues from data services
increased 29% to £2,186 million for the six months ended 30 September 2003 from
£1,701 million for the six months ended 30 September 2002. These revenues
represented 15.5% of service revenues in the Group's controlled mobile
subsidiaries for the twelve months ended 30 September 2003, compared with 14.6%
for the 2003 financial year. Whilst SMS revenues continue to represent the
largest component of data revenues, an increased focus on providing value-added
services, particularly through Vodafone live! and the Group's business
offerings, contributed to the increase in data revenues and the increased
penetration of data services into the Group's customer base. Vodafone live! and
the Group's business offerings are expected to generate further growth in
non-voice service revenues through ringtone and game downloads, picture
messaging and other content and information services. Both Vodafone Ireland's
and Vodafone Japan's data revenues represented over 20% of their service
revenues for the twelve months ended 30 September 2003.

Mobile equipment and other turnover increased 13% to £1,485 million for the six
months ended 30 September 2003, compared with £1,310 million for the six months
ended 30 September 2002, largely as a result of the volume of upgrades in the
year, which was partially offset by a decline in revenue per upgrade.

Turnover from other operations decreased by £112 million in the year to £1,346
million. This change was a result of a reduction in the turnover of Japan
Telecom, which was disposed of after the period end, and a turnover reduction in
Arcor, where improved revenues from the fixed line business were more than
offset by the disposal of the Telematiks business in the prior financial year.

Expenses

Direct costs, before exceptional items, represented 38.2% of turnover in the six
months ended 30 September 2003, compared to 37.5% for the six months ended 30
September 2002. Group acquisition and retention costs net of equipment revenues,
as a percentage of service revenues, declined to 11.3%, compared with 11.6% for
the comparable period, demonstrating the continued focus on gaining and
retaining high-value customers in the most cost-efficient manner. Direct costs
increased partly as a result of higher costs in Vodafone Japan, primarily
associated with provisions for slow moving handset stocks, partially offset by
the current period benefit from a contribution tax levy in Italy which is now
not expected to be payable.

Operating expenses represented 22.7% of turnover in respect of the six months
ended 30 September 2003, compared with 25.1% for the comparable period. The
Group's mobile businesses' network costs as a percentage of turnover reduced,
reflecting the realisation of benefits from the Group's continued focus on cost
control. The Group also benefited from reduced operating expenses in Japan
Telecom, which has been disposed of since 30 September 2003.

Depreciation and amortisation charges, excluding goodwill amortisation,
increased by 15% to £2,263 million from £1,962 million in the comparable period.
The increase was attributable to network infrastructure improvements and
additions made in the previous and current financial year. In Japan,
depreciation increased by £58 million as a result of the increased charge in
respect of its 3G network, which was opened for commercial service in December
2002. In Germany, depreciation increased by £85 million as a result of the prior
year expenditure on network infrastructure improvements and foreign exchange
movements.

The anticipated launch of 3G services in various European countries is expected
to result in approximately £0.6 billion of additional depreciation and
amortisation in the next financial year as 3G infrastructure and licences are
brought into use. Please see 'Forward-Looking Statements' on page 34.

Total Group operating profit before goodwill amortisation and exceptional items

Total Group operating profit, before goodwill amortisation and exceptional
items, increased by 23%, with underlying organic growth of 16%. Changes in
exchange rates, particularly the impact of a stronger Euro offset by a weaker
Yen and US dollar, were beneficial. Translating the results of overseas
companies at exchange rates prevailing in the prior year would reduce reported
growth by 6 percentage points to 17% over the comparable period. Acquisitions
and disposals benefited reported growth by 1%, resulting principally from the
impact of the stake increase in Societe Francaise du Radiotelephone ('SFR') in
the second half of the last financial year.

Proportionate results

Proportionate turnover increased 19% to £19,692 million as a result of both
strong organic growth and the effect of increased stakes in a number of the
Group's existing businesses. In the mobile businesses, proportionate turnover
grew by 21% to £18,675 million, including 11% organic growth in service
revenues.

The Group's proportionate EBITDA margin, before exceptional items, in the mobile
businesses increased from 39.0% in the comparable period to 40.5% in the six
months ended 30 September 2003, with most of the Group's operations reporting
increased EBITDA margins before exceptional items. The main driver behind this
growth has been savings in ongoing network costs as a percentage of turnover.
Acquisition and retention costs as a percentage of turnover were maintained at a
similar level to those incurred in the comparable period.

Mobile Telecommunications

In June 2003, the Group announced changes in the regional structure of its
operations. The former Northern Europe and Central Europe regions were combined
into a new Northern Europe region, with the exception of the United Kingdom and
Ireland that now form their own region. The following results are presented in
accordance with the new regional structure.

United Kingdom and Ireland

Financial highlights                                 Six months to
                                                     30 September
                                                     2003      2002   % change
                                                       £m        £m
Turnover               United Kingdom:
                       - Voice services             1,701     1,617          5
                       - Data services                301       258         17
                                                   ------    ------
                       - Total service revenue      2,002     1,875          7
                       - Equipment and other          148       125         18
                                                   ------    ------
                                                    2,150     2,000          8
                       Ireland                        378       300         26
                                                   ------    ------
                                                    2,528     2,300         10
                                                   ------    ------
Total Group operating
profit(1)
                       United Kingdom                 549       541          1
                       Ireland                        136        96         42
                                                   ------    ------
                                                      685       637          8
                                                   ------    ------

Proportionate EBITDA
margin(2)
                       United Kingdom                36.7%     37.0%

Key performance indicators (United Kingdom only)

ARPU(3)                                              £297      £292

Churn(3)                                             29.3%     30.0%

Acquisition and retention costs net
of equipment revenues, as a percentage
of service revenues                                  13.1%     11.8%

(1)  before goodwill amortisation
(2)  see pages 31 and 32 for details of proportionate turnover and EBITDA
(3)  ARPU and churn information represents the twelve month periods ended 30
     September 2003 and 31 March 2003, respectively


United Kingdom

Vodafone UK performed well in the period, increasing service revenues and
operating profit before goodwill amortisation in a market characterised by both
intense competition and regulatory intervention.

Total UK turnover increased by 8% year-on-year to £2,150 million, driven by a 5%
increase in voice service revenues. This was primarily due to strong outbound
revenue growth as Vodafone UK continued to realise benefits from increased
investments in acquisition and retention of high value customers. Blended ARPU
continued to grow in the period, mainly as a result of increased revenue per
minute in the prepaid customer base due to the introduction of new tariffs
during the period. Prepaid ARPU improved from £125 for the year ended 31 March
2003 to £128 for the year ended 30 September 2003 whilst contract ARPU decreased
marginally from £532 to £531.

Vodafone UK's share of mobile service revenue in the latest quarterly review by
Oftel, the UK regulator, for the quarter ended 30 June 2003, was 32.5%,
representing a lead of 6.8 percentage points over the second placed competitor.







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