Vodafone has cheered a “new chapter” for the group as it swung to an annual profit after a move to focus on its key markets and forecast further earnings growth over the year ahead.
The telecoms giant notched up pre-tax profits of 1.86 billion euro (£1.61 billion) for the year to March 31, compared with losses of 1.48 billion euro (£1.28 billion) the previous year, after service revenues jumped 8.8%.
On an underlying earnings basis, it posted a 3.8% rise to 11.35 billion euro (£9.83 billion), which it said was at the top end of its guidance.
Vodafone cautioned over “uncertainties” over the outlook caused by the Iran war and wider global economic backdrop, but said it still expects underlying earnings to rise to between 11.9 billion and 12.2 billion euro (£10.31 billion to £10.57 billion) in 2026-27.
The group has been leading a push to focus on its biggest markets in Germany and the UK, as well as Africa, while pulling out of countries where it has a smaller presence.
It last week announced a £4.3 billion deal to take full ownership of its VodafoneThree business in the UK after agreeing to buy out partner CK Hutchison.
The VodafoneThree business was formed last year after the merger of mobile operators Vodafone and Three in the UK, with Vodafone taking a 51% stake in the joint venture and Hong Kong-based Three owner CK Hutchison taking a 49% stake.
VodafoneThree became the UK’s largest mobile operator following the deal and is one of the country’s fastest-growing broadband providers.
The group said it was now “entering a new chapter as a simpler business”.
Margherita Della Valle, chief executive of Vodafone Group, said: “After the transformation of the last three years, we are now a simpler company with a stronger growth outlook.
“Our strategic progress has generated good group service revenue momentum for the year, together with profit and cash flow at the upper end of our guidance range.”
She added: “Our early successes from the UK merger integration reinforce our confidence in its potential and I am delighted that we are now gaining full ownership.
“Looking ahead, we will continue to drive continuous improvements across our business.”
The group’s results showed it rebound to sales growth in Germany over the final six months of its financial year, with service revenues up 1.4%.
In the UK, full-year service revenues lifted 29% after a 31.3% jump in the second half.
Vodafone guided for underlying earnings of 7.6 billion to 7.9 billion euro (£6.59 billion to £6.85 billion) for its European business in 2026-27.
