Vodafone H1 Adj. Profit Rises, Revenue Up 5.0%; Projects Adj. EBITDAaL At Upper Half Of Guidance

Vodafone Group Plc (VOD.L,VOD) reported first-half adjusted EBITDAaL growth of 6.5% due to revenue growth and a legal settlement in Italy. The adjusted EBITDAaL margin was 0.7 percentage points higher year-on-year at 33.6%. Group revenue increased by 5.0% driven by a return to growth of service revenue, strong recovery in handset sales following COVID disruption in the previous year and favourable foreign exchange movements during the period, the Group said.

Looking forward, Vodafone said its strengthened performance in Africa and Europe puts it on track to be at the top end of guidance for the year, as well as firmly within medium-term financial ambitions. The company is on track to achieve the upper half of its original adjusted EBITDAaL guidance range, implying 4.5-5.9% adjusted EBITDAaL growth for fiscal 2022.

For the six months ended 30 September, 2021, adjusted EBITDAaL increased by 6.5% to 7.6 billion euros from 7.0 billion euros, last year. Adjusted basic earnings per share was 4.90 eurocents compared to 3.96 eurocents.

Profit before tax was 1.28 billion euros compared to 1.93 billion euros, prior year. Earnings per share, in cents, was 3.39 compared to 4.29. The profit decrease was primarily driven by lower operating profit, the Group noted. Operating profit decreased by 21.9% to 2.6 billion euros, reflecting a prior year gain of 1.0 billion euros arising on the merger of Vodafone Hutchison Australia into TPG Telecom Limited. Excluding this, operating profit increased, the Group stated.

Revenue increased to 22.49 billion euros from 21.43 billion euros, previous year. Group service revenue increased 2.8% to 19.01 billion euros.

For fiscal 2022, updated adjusted EBITDAaL guidance is 15.2 billion euros to 15.4 billion euros, revised from original guidance of 15.0 billion euros to 15.4 billion euros. The company also increased expectation for adjusted free cash flow to at least 5.3 billion euros in fiscal 2022.

The Board has announced an interim dividend per share of 4.50 eurocents. The record date is 26 November 2021 and the dividend is payable on 4 February 2022.

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