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Vodafone Reports Record Losses, But Makes Ambitions Future Plans

12:36 am on May 31, 2006 | Category: Business, Corporate, Wireless

As expected, UK-based mobile phone giant, Vodafone Group, announced its greatest ever full-year loss yesterday, for the fiscal year that ended on March 31.

The companyâ€™s overall loss came in at a massive Â£21.9 billion (US$40.8 billion), mostly due to major write-downs on the value of assets. Vodafoneâ€™s share price, however, was unchanged for the day, due to some encouraging news from CEO, Arun Sarin.

Sarin surprised investors with a special Â£3 billion ($5.6 billion) one-time distribution, in addition to the Â£6 billion ($10.7 billion) already being given to shareholders from the sale of the companyâ€™s Japanese division. He also outlined a plan to increase revenues in the years to come by cutting costs in Europe, boosting growth in emerging markets, and putting an increased focus on advanced services like fixed-mobile convergence.

This, in combination with 10% growth in revenue for the year, â€œwill appease skeptics,â€ according to British brokerage, Seymour Pierce Ltd.

Vodafoneâ€™s earnings per share (excluding exceptional items) rose by 13% to 10.11 pence ($0.19), in the first quarter of 2006, suggesting that the companyâ€™s future prospects are strong, despite the temporary setback of this significant loss.

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