Organic service revenue growth picks up at Vodafone

Mobile phone networks giant Vodafone is expecting underlying growth in adjusted operating profit and stability in free cash flow in the current financial year.

In the year just gone (ending March 31st), group revenue rose 1.2% from a year earlier to £46.4bn, slightly ahead of forecasts of £46.3bn. Organic service revenue growth over the full year was 1.5%, with the fourth quarter seeing an acceleration in growth to 2.3%.

Earnings before interest, tax, depreciation and amortisation (EBITDA) was down 1.3% from a year earlier at £14.5bn while the EBITDA margin eased 0.8 percentage points to 31.2%.

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Adjusted operating profit at £11.5 billion, was up 2.5%* on an organic basis. Adjusted operating profit in the current year is expected to be in the range of £11.1bn to £11.9bn, reflecting the weaker euro offset by continued profit growth from Verizon Wireless, its US associate company.

Free cash flow expected to be in the range of £5.3bn to £5.8bn, reflecting the weaker euro and the loss of the dividend from mobile phone company SFR, now wholly owned by Vivendi.

The total dividend pay-out for the year has been increased to 9.52p, excluding the special dividend of 4p paid in respect of the Verizon Wireless distribution.

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