Vodafone 2024 Annual Report

Our financial performance (continued) 30 Vodafone Group Plc Annual Report 2024 Strategic report



Other information

Funding position

Adjusted free cash flow decreased by €1,539 million to €2,600 million in the period. This reflects a decrease in Adjusted EBITDAaL in the period, adverse working capital movements and lower dividends from associates and joint ventures, which outweighed lower capital additions, lower taxation, and lower dividends paid to non-controlling shareholders in subsidiaries. Acquisitions and disposals includes €500 million in relation to the disposal of 3.9% of Oak Holdings 1 GmbH in the year, offset by a final payment of €494 million to settle the Group’s obligations to the minority shareholders in Kabel Deutschland Holding A.G. Borrowings and cash position FY24 €m FY23 €m Reported change %

FY24 €m

FY23 €m

Reported change %

Bonds Bank loans

(40,743) (44,116)



Other borrowings including spectrum Cash and cash equivalents Short-term investments 2 Gross debt 1 Derivative financial instruments 3 Net collateral liabilities 4

(1,457) (1,744) (42,967) (46,655) 6,183 11,705 3,225 4,305 2,204 1,917 (1,887) (4,647) (33,242) (33,375)



Net debt 1

Non-current borrowings Current borrowings Cash and cash equivalents Borrowings Borrowings less cash and cash equivalents

(48,328) (51,669) (8,659) (14,721) (56,987) (66,390) 6,183 11,705

Notes: 1. Gross debt and Net debt are non-GAAP measures. See page 235 for more information. 2. Short-term investments includes €1,201 million (FY23: €1,338 million) of highly liquid government and government-backed securities and managed investment funds of €2,024 million (FY23: €2,967 million) that are in highly rated and liquid money market investments with liquidity of up to 90 days. 3. Derivative financial instruments excludes derivative movements in cash flow hedging reserves of €498 million gain (FY23: €2,785 million gain). 4. Collateral arrangements on derivative financial instruments result in cash being held as security. This is repayable when derivatives are settled and is therefore deducted from liquidity. Net debt decreased by €133 million to €33,242 million. This was driven by the free cash inflow of €1,783 million together with other movements of €1,065 million, offset by acquisitions and disposals of €346 million and equity dividends of €2,430 million. Other funding considerations include: FY24 €m FY23 €m Lease liabilities (9,672) (13,364) Financial liabilities under put options (KDG minority interests) - (485) Net pension fund liabilities (196) (258) Guarantees over loan issued by Australia joint venture (1,479) (1,611) 4,971 The Group’s gross and net debt includes certain bonds which have been designated in hedge relationships, which are carried at €1,229 million higher value (€1,282 million higher as at 31 March 2023) than their euro equivalent redemption value. In addition, where bonds are issued in currencies other than the euro, the Group has entered into foreign currency swaps to fix the euro cash outflows on redemption. The impact of these swaps is not reflected in gross debt and if it were included, the euro equivalent value of the bonds would decrease by €1,559 million (€1,440 million as at 31 March 2023). Equity characteristic of 50% attributed by credit rating agencies to ‘Hybrid bonds’ included in net debt of €8,993 million (€9,942 million as at 31 March 2023) 4,497

(50,804) (54,685) 7.1 Borrowings principally includes bonds of €40,743 million (€44,116 million as at 31 March 2023), lease liabilities of €9,672 million (€13,364 million as at 31 March 2023), cash collateral liabilities of €2,628 million (€4,886 million as at 31 March 2023) and €1,720 million (€1,485 million as at 31 March 2023) of bank borrowings that are secured against the Group’s shareholdings in Indus Towers and Vodafone Idea. The decrease in borrowings of €9,403 million was principally driven by repayment of bonds of €4,847 million, a decrease in collateral liabilities of €2,258 million and the transfer of borrowings in Italy and Spain to discontinued operations (€3,553 million), offset by the issuance of new bonds of €1,314 million.

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