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Vodafone Group Plc FY26 Q&A Transcript
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Akhil Dattani Vodafone
That's clear. One super quick follow-up. Is the guidance for the mid-term cashflow pro-forma for the portfolio changes that you've done, like Safaricom, or does it not capture those items?
Margherita Della Valle Vodafone James Ratzer New Street Research
Not yet. No, no. It's always, fully organic.
Yes. Good morning. Thank you, Margherita and Pilar. Hard to keep it to one question, and I was excited to see the FWA announcement that you made in the UK. I was actually going to ask my question today also on the new medium term free cash flow outlook, and in particular digging in there a bit on the capex side of things because you are guiding there that capital intensity by market is going to remain broadly stable. Yet if I think about what we know today, you know, the UK capex is being front-loaded on the network upgrade. There should be synergies to come as well in the UK. If I look in Germany, more of the fibre upgrade or all of your fibre upgrade is being done off-balance sheet through OXG rather than at the group level, all of which would suggest capex over time should be coming down. Therefore, I mean, if that's right, what are the new areas where you see incremental investment coming in, and how do you then think about the future revenue benefits from where the new investment is going? Thank you. Thank you, James. I see the angle you're coming from, absolutely in the UK we will have, let's say, peak capex this year, but we want to retain a degree of flexibility in our scenarios, to your point, for growth opportunities. For example, in the markets that have strong double-digit growth, we want to continue to always be at the forefront of our leadership position in connectivity. I'm referring, for example, to Africa, right, where we are at the top-end of the sort of next generation networks position and we want to continue to grow there, our investments in line with the growth of the demand for our services, data growth, population growth, as I was mentioning earlier. We need to continuously maintain our flexibility. If you think about investment for growth, I would just reshape the answer a little bit because I think this is broader than capex and not necessarily high capital intensity at all. I think the area that is top of mind for us continues to be B2B. If you think about our capabilities built in the last 2 years, I mentioned earlier we have stepped up investment in the last 2 years on customer experience and on B2B, and we have hired sales specialists for digital services, we have broadened our product presence in digital services, we have established new partnerships, and we have done M&A. Like we have done in Germany with Skaylink on cloud. Why are we doing all this? Because there is strong demand. You have seen, for example, we announced that we are the partner in Germany for AWS Europe Cloud coming up. We want to be in the best position to serve our customers for all these growing areas of demand. It may not imply a lot of capex, to be honest. It's maybe more opex in a way or costs in the EBITDAaL lines, but we will always try and make sure that we are best positioned to satisfy this demand because it's a significant growth driver for Europe and for Africa and Türkiye.
Margherita Della Valle Vodafone
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