Vodafone Group Plc (LON:VOD) has announced its Q1 FY22 trading update.
Growth in Europe and Africa
· Group service revenue growth of 3.3%* (Q4: 0.8%*), with growth across both Consumer and Business segments
· Strong service revenue trend, including one-off growth of around 1.0 percentage point following COVID-19 disruption last year
· Good service revenue growth in Germany of 1.4%* (Q4: 1.2%*)
| Q1 performance summary1 | Q1 FY22 €m | Q1 FY21 €m | Reported growth | Organic growth2 |
| Service revenue | 9,390 | 9,110 | 3.1% | 3.3% |
| – of which Germany | 2,872 | 2,840 | 1.1% | 1.4% |
| Other revenue | 1,711 | 1,396 | 22.6% | 20.2% |
| Total revenue | 11,101 | 10,506 | 5.7% | 5.6% |
1. Our segmental reporting has been updated to include Vantage Towers A.G. as a separate reporting segment for the year ending 31 March 2022. See page 4.
2. Organic growth is a Non-GAAP measure. All amounts marked with an “*” in the commentary represent organic growth. See page 8.
· Europe mobile contract churn 1.6 percentage points lower than Q1 FY20 (pre-pandemic), but commercial activity yet to return to normal conditions
· Roaming and visitor revenue grew 56% year-on-year, but still 54% lower than Q1 FY20 (pre-pandemic)
· Vodafone Business service revenue growth of 2.7%*, driven by strong growth in IoT and digital services
· Strong growth in Africa, with M-Pesa transaction volumes increasing 45% year-on-year
· On track to deliver FY22 guidance with Adjusted EBITDAaL expected to be between €15.0 – €15.4 billion and Adjusted FCF of at least €5.2 billion
Nick Read, Vodafone Group Chief Executive, commented:
“I am pleased to report that we are back to service revenue growth in Europe, as well as Africa. This growth was broad-based within both Consumer and Business segments, with the vast majority of our markets contributing. This is a result of our commercial and operating momentum built over the past 3 years as part of our strategic transformation.
In Europe, the operating and retail environment has not yet returned to normal conditions, but we are delivering a good service revenue performance. In our Business segment, we are seeing stronger growth with our public sector and corporate customers, whilst further building a pipeline of demand for our digital services, such as IoT, security and cloud.
In May we announced, for the first time, our medium-term growth ambition. We have entered the year in line with this ambition, on track to deliver our guidance for the year, and with a continued focus to optimise our portfolio, to accelerate the delivery of shareholder value.”
