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Vodafone Group Plc H1 FY27 Q&A Transcript
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We also see continued improvements in customer satisfaction across all our products. We continue to invest in our scale mobile and fixed networks and simplify our customer journeys. We're also taking action to further step up our productivity in Germany with the next phase of our headcount reduction programme. Yesterday we announced 2,300 role reductions. This means that we will have reduced the headcount in Germany by 40% since we began our transformation. Looking now to the rest of the Group, we have continued to make good progress in improving our customer experience, simplifying our business and driving sustainable growth. Starting with our number one priority, our customers. We are improving customer experience by removing friction, resolving issues faster, often with the assistance of AI, and offering new propositions such as SuperMobile in the UK. And we can see it in our results. We hold leadership positions now in customer satisfaction in 12 of our markets. Sentiment within our customer base is improving across all our segments. And most importantly, our mobile customer loyalty continues to grow. From a simplicity perspective, we have started the next phase of our cost transformation journey, building on a long track record of driving change inside Vodafone. As you will remember, in May we announced that we will deliver over €2.0 billion annual gross savings by FY30 across Europe and our shared operations. This will translate into over €1.0 billion in annual net opex savings. This is a comprehensive programme. We will remove more than 30% of our addressable costs. We have made a fast start, delivering over €200 million of gross savings in the first six months, supported by 3,000 role reductions, as well as the first €50 million synergies in the UK. We now have a clear line of sight on a net reduction in opex of over €200 million for the full year. The delivery of this programme will have a meaningful impact on our results. The net savings target is equivalent to more than 10% of our Adjusted EBITDAaL in Europe, driving margin expansion in the years ahead. And that takes me to our third strategic pillar, growth. You've heard me talk about Europe. We are taking structural actions in Germany, see unique opportunities in the UK, and we'll deliver the next wave of productivity growth and margin expansion. There are two other important growth levers within our portfolio, Africa and B2B. In Africa, the growth drivers remain attractive, growing customer base, underpinned by population growth, increasing data usage, expanding next-generation connectivity and Africa's largest fintech platform with over 100 million users and millions of merchants. And in B2B, we are one of Europe's leading platforms for businesses, with 5 million customers. We continue to gain share in growing markets as we expand our range of products and services, bringing the best of connectivity, but also Cloud, Security, AI, and other digital solutions together to help businesses and the public sector accelerate their digital transformation and adoption of AI. And with our sustained digital services growth, we now have a portfolio with revenue in excess of €2 billion, meaning we have moved firmly beyond core connectivity into non-linear growth opportunities such as Cloud, IoT, and Security. Taking this all together, through the continued execution of our strategic priorities of customer simplicity and growth, we are well positioned for the future. Our growth will be driven by our strong market positions and the full breadth of opportunities across Europe, Africa, and B2B. It is these strong foundations that underpin my confidence in our medium- term ambition to deliver double-digit organic growth in Adjusted free cash flow. This year, we have made a strong start, which enables us to upgrade our FY27 Group guidance. And just to recap, the midpoint of our new Group ranges imply that our organic growth will be accelerating to 7% for Adjusted EBITDAaL and 21% for Adjusted free cash flow. And with that, Pilar and I are looking forward to your questions. - Margherita Della Valle, Vodafone Group Chief Executive
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