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Vodafone Group Plc FY26 Q&A Transcript
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Margherita Della Valle Vodafone
Yes. I mean, Andrew, I think the most important point to note is that our plans are about price competition continuing in the UK. The deal baseline was better return on capital employed, allowing us to invest more on the back of the scale of the infrastructure, right? We need large, well-invested, and well-utilised networks. That's why the deals create value. When I talk about revenue synergies, I'm not thinking about the pricing environment is going to change. I mean, we can have a long debate on all the drivers of competition in telecoms, but I think that we should continue to assume that there will always be a high degree of competition in the market. Against that degree of competition, we will be in a market that we serve in an efficient and scaled way with our network. But most importantly, with the largest customer base in mobile in the UK. and the fastest-growing fixed broadband, we will have a chance to drive revenue synergies that really, I mean you have seen us outperforming the market, I think, quarter after quarter for a very long time now. This is going to be a very significant booster of the top line. How? I'll give you just two examples. There could be more. The first one is churn. Yeah. You have seen in our press release that churn is going down across all the brands in the UK, and we felt we had a particular opportunity on the Three brand because Vodafone has always been, well, has been in the last two years, customer experience leader in the market, the best net promoter scores. We're now extending our processes also to the bases we have acquired, and we are building a network that quarter after quarter is improving at a rate which I think in our industry normally you see in years. All this is driving better customer loyalty, and obviously, customer loyalty is a fantastic driver of the value equation for a telecom operator. The second aspect is cross-selling. With this, we are selling to these 28 million customers now in the UK, the largest fibre footprint in the country that we already had as Vodafone, we are now marketing the services to Three. And then James was pointing out right now, that we also have a 3.7 million households footprint on FWA, which wasn't available to us before. It's now marketed also to the Vodafone customers. I think you see in our commercial performance in the UK, already, the signs of what these revenue synergies look like. In the release, we talked about the churn. If you look at the home broadband, we have just closed the fastest growth year in customer numbers that we have ever had in the market. So, we have a real leadership opportunity in the UK by managing our customer better, offering them more products, and covering the whole market segments with the full range of the brands we have acquired. This is a fantastic potential, and I can see now we're almost a year into the integration, that is a big confidence booster for us in our performance. As I said, you have seen us as Vodafone alone outperforming. We count on the opportunities of the merger to drive this even further. Thank you. Can I just, a quick follow-up? Just can you give us a sense, that because UK is not growing organic service revenue growth right now, give or take the lumpiness, can you give us a sense of the timeline and scale when we're actually going to see that cross-selling, you know, in churn, you know, boost come through, and what does that look like in terms of growth?
Andrew Lee Goldman Sachs
Pilar López Vodafone
Yeah. There was, I mean, when you look at Q4, there was a decline in UK service revenue. It had to do with B2B, lower project activity.
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