Vodafone's Strategic Shift: Aiming for Sustainable Cash-Flow Growth

Vodafone anticipates sustainable cash-flow growth by focusing on its strongest markets. CEO Margherita Della Valle has streamlined operations, but challenges remain, particularly in Germany. Despite setbacks, including a 5% service revenue decline in Germany, Vodafone expects core earnings growth with improvements in Europe, Turkey, and Africa.

Vodafone is on a path to sustainable cash-flow growth as it concentrates on its strongest markets, according to CEO Margherita Della Valle. Despite ongoing challenges in Germany, Della Valle has restructured the company by selling operations in Spain and Italy and securing a promising merger in Britain.

With Germany's revenue experiencing a 5% decline, Vodafone's group performance still managed a modest 2.8% growth. Core earnings were notably impacted due to regulatory changes in Germany but met targets after adjustments for Turkish hyperinflation. Della Valle remains optimistic about Germany's recovery in revenue growth by year-end.

Analysts have praised Della Valle's efforts to reduce debt and enhance operational performance, yet market skepticism persists as shares fell 6% over the past year. Vodafone forecasts core earnings of up to 11.3 billion euros this year, supported by an adjusted free cash flow increase.

(With inputs from agencies.)