Vodafone 2008 Annual Report Download - page 4

I am pleased to report that your Company made further progress
during the year, with continuing execution of our strategy and
delivery of our financial targets. This is reflected in our results,
with total dividends for the year of 7.51 pence, up 11.1%. The
share price increased 21% since the beginning of the year, while
the FTSE 100 index was down 4% during the same period.
Vodafone is a truly international company, with more than
260 million proportionate customers across 25 markets and
partner networks in 42 more countries.
With more than two thirds of the world’s population now able to
benefit from mobile phone coverage, there are approximately
3.5 billion mobile customers globally, a figure that industry
analysts expect to rise by around 10% per year in the near future.
Approximately half of the world’s GNP now comes from emerging
markets and this year we reported that, for the first time, over
half our customers are in our EMAPA region. Independent research
shows clear evidence of an inextricable link between the rate
of mobile penetration in developing markets and the rate of
economic growth, where we can also see the social benefits of
mobile as it frees people to leave home in their search for jobs
and can become a method for remitting payments to their
families in some countries.
We took a major step forward in building our developing market
presence with the acquisition of Vodafone Essar in India last year.
The business, which now operates under the Vodafone brand,
is already our largest controlled business in terms of customer
numbers at over 44 million. The Vodafone Group Board visited
India earlier this year; we gained a very positive impression of the
business and our prospects in this huge, dynamic market. We are
adding around 1.5 million customers each month in India, which
operates a very different cost model, especially when revenue
We took a major step forward in building our developing market
presence with the acquisition of Vodafone Essar in India last year.
Chairman’s Statement
is on average equivalent to only 2 US cents per minute. We have
much to learn from this successful business and much to contribute.
Your Board will continue to be alert to other developing market
acquisition opportunities. At present, our EMAPA region
represents more than 25% of our revenue; we see this increasing
in the years ahead.
In Europe, our challenges are very different given the relative
maturity of the markets, most of which have over 100%
penetration. Here we are countering pressure on our traditional
revenue by becoming more productive and we are establishing
new sources of revenue.
We are seeing benefits from the major efficiency programmes
we established several years ago and this year we undertook
further initiatives to expand our network sharing with other
operators, thus reducing both capital and recurrent expenditure.
Data services (including email, music and the internet) in Europe
are an important source of growth, producing significant
increases in revenue. Additionally, revenue from our business
customers is growing much faster than the consumer sector,
which plays to our strong franchise in Europe and in an
increasingly mobile business world.
In the US, our investment in Verizon Wireless continues to
do well and in our judgement is an appreciating asset, which
generates very strong levels of cash flow. We are cooperating
closely with Verizon Wireless in a number of important areas,
including 4G technology and servicing international companies.
Our industry remains very much in the regulatory spotlight
and your Board monitors the regulatory environment carefully
as it has significant economic consequences for shareholders.
7.51p
Dividends per share +11.1%
(2007: 6.76p)
2 Vodafone Group Plc Annual Report 2008
Vodafone – Executive Summary