Vodafone 2012 Annual Report Download - page 19

Business review Performance Governance Financials Additional information
17
Vodafone Group Plc
Annual Report 2012
Talent and diversity
We continue to have high standards for talent
and to strengthen our senior leadership
population. Last year we promoted 20 internal
talents to the senior team, of which 30% were
female, and we hired 15 external candidates of
which 20% were female. We continue to rotate
top talents during their Vodafone careers. This
not only stimulates the cross-pollination of
ideas and best practices between markets, it
also develops the cultural sensitivities that will
be key in our future seniormanagement.
As with many large companies, we have a
disproportionate representation of men in our
middle and senior management. I strongly
believe that women have a range of skills
and insights that are often different from,
but complementary to, those of men, and
management teams that do not reect a
better balance are the worse for it. Currently
19% of our senior leadership team is female, up
from 17% in the prior year. Wehave set a target
of increasing the percentage year-on-year.
Organisational change
Big organisations inevitably have a tendency
towards bureaucracy, complexity and caution.
Often the right option does not get pursued
because of fear of failure or a desire not to
“rock the boat”, or the time between decision
and execution is too long and the opportunity
has passed.
Over the last three years, we have embarked
on a cultural change programme called The
Vodafone Way which is designed to engender
a cultural shift in how we do business, both
internally and externally. The key building
blocks of The Vodafone Way are speed,
simplicity and trust. Ibelieve we are already
beginning to see the benets of this in more
personal accountability and better decision-
making, but we need to drive this throughout
the Group and our leaders must be responsible
for exhibiting the right behaviours. There is
more on this on pages 34 and 35.
Summary of the year
a Our focus on the key growth areas of data, emerging markets and enterprise is
positioning us well in a difcult operating environment.
a Our commercial performance and our ability to leverage scale continue to be strong,
enabling us to gain or hold market share in many of our key markets.
a Our robust cash generation and the income dividend received from Verizon Wireless
have enabled us to translate this operational success into good returns for shareholders.
a Our goal over the next three years is to continue to strengthen our data networks
andto enrich customers’ experience.
Prospects for the 2013 nancial year
Vodafone is well positioned for the coming
year. We have continued to gain revenue
share in many of our markets, as we lead the
migration to smartphones and the adoption
of data services by the mass market. Our
exposure to the enterprise segment and our
emerging market assets will continue to be
strategic drivers of our performance and,
with VZW set for another strong year, our
overall geographical exposure is a positive
differentiator. We have a strong balance
sheet and will continue our major focus on
shareholder remuneration, while reinvesting
substantially in our network to enhance the
customer experience.
Nevertheless, the environment in Europe is
set to remain very difcult. Weak consumer
demand from poor macroeconomic
conditions, a harsh regulatory backdrop and
ongoing competition create material barriers
to growth. MTRs alone will have a negative
impact, similar in percentage terms to the 2012
nancial year, on service revenue growth in the
2013 nancial year.
On an underlying basis, excluding foreign
exchange rate movements, we expect growth
in adjusted operating prot, and stability
in free cash ow, compared with the 2012
nancialyear.
Adjusted operating prot is expected to be in
the range of £11.1 billion to £11.9 billion.
We anticipate free cash ow for the coming
year of £5.3 billion to £5.8 billion. The loss of
dividends from SFR following the sale of our
44% stake, as well as a weaker euro year-on-
year, are the main differences from the 2012
nancial year. We expect capital expenditure
to remain broadly steady on a constant
currencybasis.
We expect the Group EBITDA margin decline
tocontinue its improving trend, supported
bycontinued strong growth and operating
leverage in our AMAP region, and improving
control of commercial costs in Europe.
We remain committed to continuing to deliver
a good return to our shareholders through the
achievement of our targets for free cash ow
and dividend growth; our focused investment
in protable growth areas; and our ongoing
capital discipline.
.
Vittorio Colao
Chief Executive
Employee talent and diversity
Our goal is to achieve a broad employee
base in terms of gender and nationality,
and specically target increased
representation of women and emerging
market talent at senior management level.
More detail
Page 34