154 Vodafone Group Plc Annual Report 2026
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4. Impairment losses (continued) The Group performs its annual impairment test for goodwill and indefinite-lived intangible assets at 31 March and when there is an indicator of impairment of an asset. Judgement is exercised by management in determining whether any internal or external sources of information observed are indicative that the carrying amount of any of the Group’s cash generating units is not recoverable. Year ended 31 March 2026 The Group did not recognise any impairments for the year ended 31 March 2026. Value in use assumptions The table below shows key assumptions used in the value in use calculations, and separately presented cash generating units for which the carrying amount of goodwill is significant in comparison with the Group’s total carrying amount of goodwill: Assumptions used in value in use calculations Germany UK % % Pre-tax discount rate 7.5 9.1 Long-term growth rate 1.2 2.0 Projected adjusted EBITDAaL CAGR 1 1.9 7.7 Projected capital expenditure 2 19.5 - 20.3 10.9 - 16.3 Sensitivity analysis The recoverable amount estimates for Germany and the UK exceed carrying value by €0.3 billion and €2.2 billion respectively. If the assumptions used in the impairment review were changed to a greater extent than as presented in the following table, the changes would, in isolation, lead to an impairment loss being recognised for the year ended 31 March 2026. Change required for carrying value to equal recoverable amount Germany UK pps pps Pre-tax discount rate 0.1 2.6 Long-term growth rate (0.0) (2.8) Projected adjusted EBITDAaL CAGR 1 (0.2) (5.6) Projected capital expenditure 2 0.5 10.3 Notes: 1. Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing. 2. Projected capital expenditure, which excludes licences and spectrum, is expressed as capital expenditure as a percentage of revenue in the initial five years for all cash-generating units of the plans used for impairment testing.
For the Group’s operations in Germany management has prepared the following sensitivity analysis to the base case recoverable amount less carrying value for changes in pre-tax discount rate and projected adjusted EBITDAaL CAGR 1 assumptions. The associated impact of the change in each key assumption does not consider any consequential impact on other assumptions used in the impairment review. Recoverable amount less carrying value Germany €bn Base case 0.3 Change in pre-tax discount rate Decrease by 0.5pps 3.2 Increase by 0.5pps (2.2) Change in projected adjusted EBITDAaL CAGR 1 Decrease by 2.0pps (3.1) Increase by 2.0pps 4.0 Note: 1. Projected adjusted EBITDAaL CAGR is expressed as the compound annual growth rates in the initial five years for all cash-generating units of the plans used for impairment testing.
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