Vodafone reports rise in earnings and return to profit

Vodafone Ireland has said it is not immune to the impact of the coronavirus pandemic on its business as it reported a rise in earnings and a return to profit last year.

The comments come as Carphone Warehouse this week announced the closure of its stores in the Republic with the loss of nearly 500 jobs.

Vodafone, which has more than 2.3 million customers locally, said while its business model is more resilient than many other sectors, it is under pressure.

Revenues

“The company is experiencing a direct impact on our roaming revenues from lower international travel and has observed deterioration in debtor’s ageing, particularly in the SME sector, Vodafone said in a note attached to its latest company accounts.

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“However, the company is also seeing significant increases in data volumes and further improvements in loyalty, as our customers place greater value on the quality, speed and reliability of our networks,” it added.

Vodafone has reported total turnover of €944.9 million for the year to the end of March 2020, with an adjusted earnings before interest, taxes, depreciation, and amortisation (ebitda) of €190.8 million. This compares to revenues of €946.5 million and ebitda of €175.3million a year earlier. Vodafone attributed the slight dip in revenues to regulatory changes.

Pretax profits totalled €13.2 million versus a €5 million loss in 2019.

Vodafone, which last year became the first mobile operator to roll-out 5G services locally, said it gained more than 45,000 mobile and 18,000 fixed -contract customers last year.

Staff numbers at the telco totalled 1,020 last year as against 1,067 in 2019 with staff costs, including wages and salaries, falling from €100 million to €90.6 million.

During the year there was an actuarial loss of €20.1m on the company defined benefit pension plan which was primarily due to a reduction in the discount rate driven by the fall in corporate bond yields globally.

Vodafone has provided capital funding of €93 million to date for Siro, the joint venture it formed with ESB in late 2014.

Investing

Siro, which is investing more than €450 million in building a national fibre to the home broadband network ,recorded a €31.7 million pretax loss for 2019, the last year for which accounts are publicly available. As of the end of February, Siro had passed 370,000 premises.

Vodafone Ireland chief executive Anne O'Leary said she was pleased by the company's latest results.

“Our attention remains on . . . our products and services [and] meet ever changing demands as we work our way through to recovery,” said Ms O’Leary.