Interim Results - Part 4
Vodafone Group PLC
13 November 2001
PART 4
7 Reconciliation of operating loss to net cash inflow from
operating activities
Six months Six months Year
to to ended
30 30 31
September September March
2001 2000 2001
£m £m £m
Operating loss (7,089) (3,130) (6,439)
Exceptional items 4,000 54 176
Depreciation 1,053 690 1,593
Amortisation of goodwill 5,335 4,542 9,585
Amortisation of other
intangible fixed
assets 19 10 24
-------- -------- --------
3,318 2,166 4,939
Working capital
movements 322 (224) (268)
Payments in respect of
exceptional items - (54) (84)
-------- -------- --------
3,640 1,888 4,587
======== ======== ========
8. Analysis of net debt
Other
Acquisitions non-cash
At 1 (excluding changes & At 30
April Cash cash & exchange September
2001 flow overdrafts) movements 2001
£m £m £m £m £m
Liquid
resources 7,593 (2,881) - (140) 4,572
-------- ----- ------- ------ -------
Cash at bank
and in hand 68 30 - (2) 96
Bank
overdrafts (5) (1) - - (6)
-------- ----- ------- ------ -------
63 29 - (2) 90
-------- ----- ------- ------ -------
Debt due
within
one year
(other than
bank
overdrafts) (3,596) 862 (139) (618) (3,491)
Debt due
after
one year (10,630) (445) (1) 812 (10,264)
Finance leases (152) 32 (27) - (147)
-------- ----- ------- ------ -------
(14,378) 449 (167) 194 (13,902)
-------- ----- ------- ------ -------
(6,722) (2,403) (167) 52 (9,240)
======== ==== ======= ====== =======
Included within net debt are bond issues maturing as follows:
£m
One year or less 3,254
More than two years but not more than
five years 3,909
More than five years 5,747
-------
12,910
=======
9. Summary of differences between UK and US GAAP
The interim results have been prepared in accordance with UK
Generally Accepted Accounting Principles ('UK GAAP'), which
differ in certain significant respects from US Generally
Accepted Accounting Principles ('US GAAP'). A description of
the relevant accounting principles which differ materially is
provided within Vodafone Group Plc's Annual Report & Accounts
for the year ended 31 March 2001. The effects of these
differing accounting principles are as follows:
Six months Year
to ended
Six months 30 31
to September March
30 2000 2001
September as as
2001 restated restated
£m £m £m
Revenues in accordance
with UK GAAP 8,906 7,019 15,004
Items decreasing
revenues:
Non-consolidated
subsidiaries (2,182) (1,409) (3,409)
Deferral of connection
revenues (155) - (492)
-------- -------- --------
Revenues in accordance
with US GAAP 6,569 5,610 11,103
======== ======== ========
Net loss in accordance
with UK GAAP (9,735) (4,754) (9,885)
Items (increasing)
/decreasing net loss:
Goodwill and other
intangibles
amortisation (6,280) (2,338) (5,302)
Deferral of connection
income (20) - (54)
Capitalised interest 203 - 365
Income taxes 4,750 2,302 7,847
Minority interests 1,020 19 (40)
Other (43) 14 (2)
-------- -------- --------
Net loss in accordance
with US GAAP (10,105) (4,757) (7,071)
======== ======== ========
US GAAP basic loss
per ordinary share (14.91)p (8.01)p (11.51)p
======== ======== ========
Shareholders' equity
in accordance with
UK GAAP 138,445 136,204 145,007
Items increasing
/(decreasing)
shareholders'
equity:
Goodwill and other
intangibles
- net of amortisation 62,067 51,385 66,197
Deferral of connection
income (105) - (85)
Capitalised interest 568 - 365
Cumulative deferred
income taxes (48,469) (44,941) (51,222)
Minority interests (3,887) (1,318) (5,149)
Proposed dividends 492 423 464
Other (103) (65) (55)
-------- -------- --------
Shareholders' equity
in accordance
with US GAAP 149,008 141,688 155,522
======== ======== ========
10 Proportionate financial information
Six months Year
Six months to ended
to 30 31
30 September March
September 2000 2001
2001 Note 1 Note 1
£m £m £m
Proportionate turnover
Mobile telecommunications:
Northern Europe 3,133 2,582 5,357
Central Europe 2,343 2,115 4,323
Southern Europe 2,408 1,612 3,521
-------- -------- --------
Europe 7,884 6,309 13,201
Americas 2,839 2,414 5,008
Asia Pacific 2,517 1,234 2,771
Middle East and Africa 252 213 448
-------- -------- --------
13,492 10,170 21,428
Other operations 834 372 802
-------- -------- --------
14,326 10,542 22,230
======== ======== ========
Proportionate EBITDA
(Note 2)
Mobile telecommunications:
Northern Europe 1,028 785 1,674
Central Europe 1,026 624 1,478
Southern Europe 1,049 673 1,450
-------- -------- --------
Europe 3,103 2,082 4,602
Americas 1,000 815 1,627
Asia Pacific 567 285 587
Middle East and Africa 108 100 227
-------- -------- --------
4,778 3,282 7,043
Other operations (1) 6 (27)
-------- -------- --------
Proportionate EBITDA 4,777 3,288 7,016
(Note 2)
Less: depreciation
and amortisation,
excluding goodwill (1,648) (1,078) (2,234)
-------- -------- --------
Mobile telecommunications 3,321 2,302 5,019
Other operations (192) (92) (237)
-------- -------- --------
Proportionate total
Group operating
profit before
goodwill amortisation
and exceptional
items 3,129 2,210 4,782
======== ======== ========
Notes
(1)Financial information for the comparative periods is stated
on a pro forma basis for the acquisition of Mannesmann, and
has been presented in accordance with the new segmental
basis. Further details are provided in Note 1.
(2)Proportionate EBITDA (earnings before interest, tax,
depreciation and amortisation) is defined as operating
profit before exceptional items plus depreciation and
amortisation of subsidiary undertakings, joint ventures,
associated undertakings and investments, proportionate to
equity stakes. Proportionate EBITDA represents the Group's
ownership interests in the respective entities' EBITDA. As
such, proportionate EBITDA does not represent EBITDA
available to the Group.
Other information
1) Copies of the Group's Interim Report will be sent to all
shareholders. Further copies will be available from the
Company's registered office:
The Courtyard
2-4 London Road
Newbury
Berkshire RG14 1JX
England.
2) This report will also be available on the Vodafone Group
Plc website: www.vodafone.com from 13 November 2001.
For further information:
Tim Brown, Group Corporate Affairs Director
Melissa Stimpson, Head of Group Investor Relations
Bobby Leach, Head of Group Financial Public Relations
Darren Jones, Senior Investor Relations Manager
Jon Earl, Senior Investor Relations Manager
Tel: +44 (0) 1635 673310
Lulu Bridges/John West
Tavistock Communications
Tel: +44 (0) 207 600 2288
Forward-Looking Statements
This document contains certain 'forward-looking statements'
with respect to the financial condition, results of operations
and business and some of our plans and objectives with respect
to these items. In particular, certain statements concerning
our expectations and plans, strategy, management's objectives,
prospects, trends, market standing, overall market trends, and
revenues, contain forward-looking information. In addition,
'forward-looking statements' include statements made with
respect to expectations as to launch and roll-out dates for
products and services, including 3G services, future
performance, costs, revenues, improvements in margin, expected
synergies, the likelihood of impairment charges, average
revenue per customer and revenues derived from the new non-
voice services, expected EBITDA results, growth, churn rate,
mobile penetration rates and internet use and other trend
projections. Forward-looking statements are sometimes, but not
always, identified by their use of a date in the future or such
words as 'anticipates', 'aims', 'due', 'could', 'may',
'should', 'expects', 'believes', 'intends', 'plans', 'targets',
'goal' or 'estimates'. By their nature, forward-looking
statements are inherently predictive, speculative and involve
risk and uncertainty because they relate to events and depend
on circumstances that will occur in the future. There are a
number of factors that could cause actual results and
developments to differ materially from those expressed or
implied by these forward-looking statements. These factors
include, but are not limited to, the following: changes in
economic conditions in markets served by our operations that
would adversely affect the level of demand for mobile services;
greater than anticipated competitive activity requiring reduced
pricing and/or new product offerings or resulting in higher
costs of acquiring new customers; slower customer growth or
reduced customer retention; the impact on capital spending from
investment in network capacity and the deployment of new
technologies, or the rapid obsolescence of existing technology;
the possibility that technologies, including mobile internet
platforms, and services, including 3G services, will not
perform according to expectations or that vendors' performance
will not meet our requirements; changes in the projected growth
rates of the mobile telecommunications industry; accuracy of or
any changes in our projected revenue model or global branding
strategy; our ability to meet the objectives of our management
initiatives; future revenue contributions of the services we
offer as a percentage of total revenue leading to difficulties
in meeting our target improvements in margin; lower than
expected impact of GPRS, 3G and Vizzavi Europe's partnership
with our operators on our future revenues; our ability to
harmonise our mobile platforms and any delays, impediments or
other problems associated with the roll-out and scope of 3G
technology and services and Vizzavi services in new markets;
our ability to offer new services and the delivery and
performance of GPRS and 3G handsets, network equipment and
other key products from our suppliers; greater than anticipated
prices of new mobile handsets; any conditions imposed in
connection with regulatory approvals sought in connection with
pending acquisitions and dispositions; changes in the
regulatory framework in which we operate; the impact of legal
or other proceedings against us or other companies in the
mobile telecommunications industry; and changes in exchange
rates, including in particular the exchange rate of the pound
to the euro. Furthermore, a review of the reasons why actual
results and developments may differ materially from the
expectations disclosed or implied within forward-looking
statements can be found under the heading 'Risk Factors' on
pages 8 to 10 of our U.S. Annual Report on Form 20-F for the
year ended 31 March 2001. All subsequent written or oral
forward-looking statements attributable to Vodafone, any
Vodafone members or persons acting on our behalf are expressly
qualified in their entirety by the factors referred to above.
APPENDIX 1 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
CUSTOMER INFORMATION AS AT 30 SEPTEMBER 2001
REGISTERED
PERCENTAGE PROPORTIONATE REGISTERED
COUNTRY OPERATOR OWNERSHIP CUSTOMERS PREPAID
(Note 2) (thousands) (%)
NORTHERN EUROPE
UK Vodafone** 100.0 12,799 64
Ireland Eircell 100.0 1,611 71
Netherlands Libertel Vodafone 70.0 2,256 66
Sweden Europolitan
Vodafone** 71.1 762 25
France SFR 31.9 3,699 48
Belgium Proximus 25.0 1,014 56
TOTAL 22,141 57
CENTRAL EUROPE
Germany D2 Vodafone 99.6 21,787 60
Hungary Vodafone** 50.1 169 90
Poland Plus GSM 19.6 620 42
Switzerland Swisscom Mobile 25.0 878 40
TOTAL 23,454 56
SOUTHERN EUROPE
Greece Panafon Vodafone** 52.8 1,423 72
Italy Omnitel Vodafone 76.5 12,738 91
Malta Vodafone** 80.0 105 91
Portugal Telecel Vodafone 50.9 * *
Spain Airtel Vodafone 91.6 6,824 56
Albania Vodafone** 76.9 41 99
Romania Connex GSM 20.1 N/A N/A
TOTAL 22,815 78
AMERICAS
United States Verizon Wireless 44.1 12,658 6
(Note 3)
Mexico Iusacell 34.5 590 76
TOTAL 13,248 10
ASIA PACIFIC
Australia Vodafone 95.5 1,991 34
New Zealand Vodafone 100.0 1,077 78
Japan J-Phone Various 6,726 3
China China Mobile 2.2 1,384 47
(Hong Kong)
Limited
Fiji Vodafone 49.0 36 90
India RPG Cellular 20.6 19 57
TOTAL 11,233 41
MIDDLE EAST
& AFRICA
Egypt Click Vodafone** 60.0 844 89
South Africa Vodacom 31.5 1,782 81
Kenya Safaricom 40.0 97 99
TOTAL 2,723 83
GROUP TOTAL 95,614 48
Appendix 1 (continued)
CONTROLLED ACTIVE CONTROLLED
(Note 1) INACTIVE
COUNTRY OPERATOR PREPAID CONTRACT TOTAL TOTAL
(%) (%) (%) (%)
NORTHERN EUROPE
UK Vodafone** 75 99 84 16
Ireland Eircell 97 98 97 3
Netherlands Libertel Vodafone 93 99 95 5
Sweden Europolitan Vodafone** 82 91 89 11
France SFR
Belgium Proximus
TOTAL 80 98 87 13
CENTRAL EUROPE
Germany D2 Vodafone 88 95 91 9
Hungary Vodafone** 89 97 89 11
Poland Plus GSM
Switzerland Swisscom Mobile
TOTAL 88 95 91 9
SOUTHERN EUROPE
Greece Panafon Vodafone** * * * *
Italy Omnitel Vodafone 94 92 93 7
Malta Vodafone** 93 99 94 6
Portugal Telecel Vodafone * * * *
Spain Airtel Vodafone 85 95 89 11
Albania Vodafone**
Romania Connex GSM
TOTAL 90 94 91 9
AMERICAS
United States Verizon Wireless
(Note 3)
Mexico Iusacell
TOTAL N/A N/A N/A N/A
ASIA PACIFIC
Australia Vodafone 88 94 92 8
New Zealand Vodafone 91 99 93 7
Japan J-Phone
China China Mobile
(Hong Kong) Limited
Fiji Vodafone
India RPG Cellular
TOTAL 90 95 92 8
MIDDLE EAST
& AFRICA
Egypt Click Vodafone** 97 97 97 3
South Africa Vodacom
Kenya Safaricom
TOTAL 97 97 97 3
GROUP TOTAL 88 96 90 10
Note 1
Active customers are defined as customers who have made or
received a chargeable event in the last three months or, where
information is not available, defined as customers who have
made a chargeable event in the last three months (indicated by
**).
Note 2
All ownership percentages are stated as at 30 September 2001
and exclude options, warrants or other rights or obligations of
Vodafone Group Plc to increase or decrease ownership in any
venture. Ownership interests have been rounded to the nearest
tenth of one percent.
Note 3
The Group's proportionate customer base has been adjusted for
Verizon Wireless's proportionate ownership of its customer base
of approximately 98.1%.
*Listed subsidiaries still to report.
APPENDIX 2 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
ARPU INFORMATION FOR THE 12 MONTH PERIOD TO 30 SEPTEMBER 2001 (Note 1)
ARPU (Note 2)
LOCAL REGISTERED REGISTERED REGISTERED
COUNTRY OPERATOR CURRENCY PREPAID CONTRACT TOTAL
NORTHERN EUROPE
UK Vodafone GBP 139 535 281
Netherlands Libertel
Vodafone EUR * * *
Sweden Europolitan
Vodafone SEK * 6,646 5,329
CENTRAL EUROPE
Germany D2 Vodafone EUR 119 586 317
Hungary Vodafone HUF 31,820 200,546 51,048
SOUTHERN EUROPE
Greece Panafon
Vodafone EUR * * *
Italy Omnitel
Vodafone EUR 287 757 332
Malta Vodafone MTL 106 922 206
Portugal Telecel
Vodafone EUR * * *
Spain Airtel
Vodafone EUR 141 663 369
ASIA PACIFIC
Australia Vodafone AUD 298 906 711
New Zealand Vodafone NZD 280 1,821 646
MIDDLE EAST & AFRICA
Egypt Click Vodafone EGP 1,076 2,525 1,275
Note 1
Vodafone introduced a new industry measurement of active customers in
March 2001. This is the third quarter for which Vodafone has
collated and reported on this information. As there is no
historical information prior to 31 March 2001, Vodafone will
include active ARPU numbers when it has a history of
performance for a proper basis of comparison. However, the
underlying levels of active customer spend continue to be
higher than the reported registered ARPU.
Note 2
ARPU is calculated for the twelve month period to 30 September 2001 and
excludes handset revenues and connection fees.
* Listed subsidiary information not published.
APPENDIX 3 - VODAFONE GROUP PLC - MOBILE TELECOMMUNICATIONS BUSINESSES
NON-VOICE SERVICES AS A PERCENTAGE OF SERVICE REVENUES
12 MONTHS TO 30 SEPTEMBER 2001
TOTAL
OPERATOR MESSAGING INTERNET NON-VOICE
DATA DATA SERVICES
NORTHERN EUROPE
UK Vodafone 7.1% 0.9% 8.0%
Others 4.3% 0.2% 4.5%
TOTAL 6.0% 0.6% 6.6%
CENTRAL EUROPE
D2 Vodafone 13.9% 0.3% 14.2%
Others 5.8% 0.1% 5.9%
TOTAL 13.1% 0.3% 13.4%
SOUTHERN EUROPE
Omnitel
Vodafone 7.1% 0.2% 7.3%
Others 7.4% 0.1% 7.5%
TOTAL 7.2% 0.2% 7.4%
AMERICAS
Verizon
Wireless - 0.5% 0.5%
Other - - -
TOTAL - 0.5% 0.5%
ASIA PACIFIC
J-Phone 4.4% 7.4% 11.8%
Others 4.9% 0.1% 5.0%
TOTAL 4.5% 5.3% 9.8%
MIDDLE EAST
& AFRICA 2.5% - 2.5%
PROPORTIONATE
GROUP TOTAL 6.0% 1.1% 7.1%
======= ======= =======
CONTROLLED
GROUP TOTAL 8.7% 0.4% 9.1%
======= ======= =======
Appendix 3 (continued)
SEPTEMBER 2001 (MONTH ONLY)
TOTAL
OPERATOR MESSAGING INTERNET NON-VOICE
DATA DATA SERVICES
NORTHERN EUROPE
UK Vodafone 8.4% 0.8% 9.2%
Others 6.6% 0.2% 6.8%
TOTAL 7.6% 0.6% 8.2%
CENTRAL EUROPE
D2 Vodafone 13.7% 0.4% 14.1%
Others 6.0% 0.4% 6.4%
TOTAL 12.8% 0.4% 13.2%
SOUTHERN EUROPE
Omnitel
Vodafone 8.6% 0.2% 8.8%
Others 7.4% 0.1% 7.5%
TOTAL 8.0% 0.2% 8.2%
AMERICAS
Verizon
Wireless 0.1% 0.6% 0.7%
Other - - -
TOTAL 0.1% 0.6% 0.7%
ASIA PACIFIC
J-Phone 5.4% 9.2% 14.6%
Others 7.0% 0.3% 7.3%
TOTAL 5.7% 7.6% 13.3%
MIDDLE EAST
& AFRICA 3.8% - 3.8%
PROPORTIONATE
GROUP TOTAL 6.7% 1.7% 8.4%
======= ======= =======
CONTROLLED
GROUP TOTAL 9.5% 0.4% 9.9%
======= ======= =======
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