Impairment Review & Outlook

Vodafone Group Plc
27 February 2006


27 February 2006

                    IMPAIRMENT REVIEW AND UPDATE TO OUTLOOK

Against a backdrop of intensifying competition and pricing pressures in several
of its key markets, Vodafone Group Plc ('Vodafone') is currently completing its
detailed budget for the year ending 31 March 2007 and its annual long term
planning process. This incorporates an annual review of the carrying value of
its assets in accordance with International Financial Reporting Standards
('IFRS'). Under IFRS, which was first adopted with effect from 1 April 2004,
goodwill is no longer subject to annual amortisation. Previously, under UK GAAP,
goodwill was amortised with a charge to the income statement of approximately
£13 billion per annum.

Vodafone now expects the outcome of this review of the carrying value of its
assets ('impairment review') will be a material impairment in the carrying value
of goodwill in the range of £23 billion to £28 billion, reflecting a lower view
of growth prospects, particularly in the medium to long term, than those it had
used previously. Final details of the review of carrying values will be
announced upon completion of the process.

Vodafone is also providing an update to its revenue and EBITDA margin
expectations for the year ending 31 March 2007. Vodafone's expectations for
adjusted earnings per share for the year ending 31 March 2007 are in line with
current market expectations.

Vodafone's outlook for the current financial year remains unchanged.

Impairment review

Under IFRS, goodwill and indefinite lived intangible assets in respect of
subsidiary undertakings and joint ventures are not subject to amortisation but
are tested at least annually for impairment or when indicators are identified
that an asset may be impaired. Investments in associated undertakings are also
tested for impairment. Finite lived assets, such as 3G licences, are carried at
historic cost and subject to annual depreciation or amortisation and are
reviewed for indicators of impairment.

As detailed below, Vodafone carries a significant amount of goodwill on its
balance sheet, principally resulting from the Mannesmann acquisition in 2000,
which occurred at a time when share prices in the telecommunications sector were
significantly higher than today.

The Group prepares ten year plans for its businesses annually, which it also
uses for the purposes of conducting the carrying value review. Reflecting the
increasingly competitive environment in the industry, Vodafone has incorporated
into its latest ten year plan a lower view of growth prospects for a number of
key operating companies, particularly in the medium to long term, than those it
has used previously.

The result of these factors is that Vodafone expects to report:

*  An impairment of the Group's goodwill in the range of £23 billion to
   £28 billion in respect of reductions in the aggregate goodwill for Vodafone
   Germany, Vodafone Italy and, potentially, Vodafone Japan. It is expected that
   most of the total will be attributable to Vodafone Germany.

*  No impairment for any other subsidiary, joint venture or investment in
   associated undertakings

*  No impairment in respect of finite lived assets


A summary of the Group's goodwill in respect of subsidiary undertakings and
joint ventures as at 30 September 2005 is set out below.

                                                                     £ billion
                                                                     ---------
Germany                                                                   35.5
Italy                                                                     19.7
Japan                                                                      9.0
Spain                                                                     10.3
UK                                                                         0.7
Other subsidiaries and joint ventures                                      6.3
                                                                     ---------
                                                                          81.5
                                                                     ---------

The carrying value of investments in associated undertakings as at 30 September
2005 was £22.1 billion.

No impairment is expected to be recorded under US GAAP due to a different
methodology under US GAAP when compared to IFRS.

This expected reduction in carrying value of goodwill will not impact this
year's reported cash flows or distributable reserves. This expected impairment
to goodwill will be reported within operating profit in Vodafone's Income
Statement for the year ending 31 March 2006, but will be classified as an item
not reflecting underlying business performance and therefore will not impact
adjusted performance reporting measures.

Outlook for the year ending 31 March 2007

Vodafone will provide a full outlook statement for the year ending 31 March 2007
with its 2006 preliminary results announcement on 30 May 2006.

It is now expected that the overall proportionate mobile revenue growth, on an
organic basis, will be in the range of 5% to 6.5%. This lower growth rate
compared to the year ending 31 March 2006 reflects the increasingly intense
competitive environment, continuing regulatory reductions in termination rates
and the one-off beneficial impact in the year ending 31 March 2006 of the
introduction of mobile to mobile termination rates in France.

The Group envisages a year on year decline in proportionate mobile EBITDA
margins, excluding Japan, of around 1% on an organic basis, as initiatives to
drive further cost efficiencies are offset by pricing pressures, additional
investments in customers and changes in termination rates.

The Group continues to expect EBITDA margins for Japan to be in the high teens
for the year.

Vodafone is reiterating other expectations for the year ending 31 March 2007
contained within the outlook statement provided on 15 November 2005, as updated
on 24 January 2006. The statements were provided on the basis that the impact of
the transactions in Sweden, India, South Africa and Turkey were not included.
Vodafone will update these expectations for the impact from these transactions
on 30 May 2006.

Vodafone's expectations for adjusted earnings per share for the year ending 31
March 2007 are in line with current market expectations.


For further information:

Vodafone Group

Investor Relations                         Media Relations
Telephone: [phone]             Telephone: [phone]


Notes to Editors:

IFRS requirements

Under IFRS, Vodafone tests fixed assets, including goodwill, for impairment by
comparing the carrying value for each operating company to its respective
recoverable amount. The recoverable amount is defined as the higher of fair
value less costs to sell, and value in use. Value in use is estimated based on
discounted cash flows.

Key assumptions used in value in use calculations

The Group prepares ten year plans for its businesses annually and historically
has used these ten year plans for its value in use calculations.

Reflecting the increasingly competitive environment in the industry, Vodafone
has incorporated into its latest ten year plan a lower view of growth prospects
for a number of key operating companies, particularly in the medium to long
term, than those it has used previously.

As a result of these lower growth prospects, Vodafone has now also determined
that it is appropriate to use projections of five years instead of ten years for
its value in use calculations, except in operations it is forecasting to grow
ahead of the long term growth rate for the relevant market for a period of more
than five years.

The perpetuity growth rate used in the Group's value in use calculations for
mobile businesses is generally determined as the lower of the nominal GDP rate
for the country of operation and the long term compound annual growth rate in
EBITDA implied by the business plan. The lower view of longer term prospects has
resulted in a reduction in the perpetuity growth rate in certain markets.

US GAAP requirements

Under US GAAP, Vodafone tests finite lived fixed assets for impairment using a
two step process. The carrying value of each operating company is first compared
to its respective recoverable amount. The recoverable amount is determined based
on undiscounted cash flows. Secondly, if the carrying value exceeds the
recoverable amount, then the carrying value is reduced to its fair value, which
is generally determined using discounted cash flows.

Forward-looking statement

This Press release contains forward-looking statements, in particular in
relation to the Group's outlook for the financial years ending on 31 March 2006
and 31 March 2007, which are subject to risks and uncertainties because they
relate to future events. Some of the factors which may cause actual results to
differ from these forward looking statements can be found by referring to the
information contained under the heading 'Forward Looking Statements' in our
interim results announcement for the six months to 30 September 2005 and under
the heading 'Risk Factors' in our Annual Report for the year ended 31 March
2005. The interim results announcement and our Annual Report can be found on our
website (www.vodafone.com).




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