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Vodafone FY22 Pre-tax Profit Down, Issues FY23 Earnings View

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British telecom major Vodafone Group Plc reported Tuesday weak pre-tax profit in its fiscal 2022, while attributable profit increased significantly with higher revenues. Looking ahead, for fiscal 2023, the company projects adjusted EBITDAaL, a key earnings metric, to be below or above last year. Further, the company maintained its dividend for the year.

Nick Read, Group Chief Executive, said, "Whilst we are not immune to the macroeconomic challenges in Europe and Africa, we are positioned well to manage them and we expect to deliver a resilient financial performance in the year ahead... Our near-term operational and portfolio priorities remain unchanged from those communicated 6 months ago."

For fiscal 2023, adjusted EBITDAaL is expected to be between 15.0 billion euros and 15.5 billion euros, and adjusted free cash flow to be about 5.3 billion euros.

The company said the current macroeconomic climate presents specific challenges, particularly inflation, and is likely to impact financial performance in the year ahead.

For the year, the company announced total dividends per share of 9 euro cents, same as last year. The final dividend per share is 4.5 euro cents, of which the record date is June 6 and the dividend is payable on August 5.

For fiscal 2022, profit before taxation declined to 3.95 billion euros from last year's 4.40 billion euros.

Profit attributable to owners of the parent, however, surged to 2.09 billion euros from last year's 112 million euros. Earnings per share were 7.17 cents, up from 0.38 cent last year.

Adjusted basic earnings per share were 11.03 cents, compared to prior year's 8.08 cents.

Operating profit increased 11.1 percent from last year to 5.67 billion euros.

Adjusted EBITDAaL grew 5.7 percent on a reported basis and 5 percent organically to 15.21 billion euros driven by good revenue growth and continued cost transformation programme savings.

The Adjusted EBITDAaL margin was 0.5 percentage points higher year-on-year at 33.4 percent.

Group revenue increased 4 percent to 45.58 billion euros from prior year's 43.81 billion euros, driven by service revenue growth in Europe and Africa and higher equipment revenue.

Group service revenue increased 2.6 percent organically to 38.20 billion euros.

In London, Vodafone shares were trading at 120.46 pence, up 0.33 percent.

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