UNITED STATES
SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549
FORM
(Mark One)
OR
For the fiscal year ended
OR
OR
Date of event requiring this shell company report . . . . . . . . . . . . . . . . . . .
For the transition period from to
Commission file number
(Exact name of Registrant as specified in its charter) |
As above |
(Translation of Registrant's name into English) |
(Jurisdiction of incorporation or organization) |
(Address of principal executive offices) |
Telephone + |
(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person) |
Securities registered or to be registered pursuant to Section 12(b) of the Act.
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| Name of each exchange on which registered |
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Securities registered or to be registered pursuant to Section 12(g) of the Act.
None
(Title of Class)
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.
None
(Title of Class)
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the annual report.
Ordinary Shares of 20 20/21 US cents each: | |
7% Cumulative Fixed Rate Shares of £1 each: |
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Yes ☐
Note — Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligations under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Accelerated filer ☐ | Non-accelerated filer ☐ | Emerging growth company |
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act. ◻
† The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP ☐ |
| Other ☐ |
If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.
Item 17 ☐ Item 18 ☐
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yes
Annual Report and Form 20-F Information 2022 incorporation by reference guide
Pursuant to Rule 12b-23(a) under the Securities Exchange Act of 1934, as amended, the information for the 2022 Form 20-F of Vodafone Group Plc (‘Vodafone’) set out below is being incorporated by reference from Vodafone’s ‘Annual Report and Form 20-F Information 2022’ included as exhibit 99.1 to this Form 20-F dated and submitted on June 16, 2022.
References below to major headings include all information under such major headings, including subheadings, unless such reference is a reference to a subheading, in which case, such reference includes only the information contained under such subheading.
The guide below contains a detailed description of where each item of Form 20-F has been incorporated by reference. References herein to Vodafone’s websites, including where a link is provided, are textual references only and information on or accessible through such websites does not form part of and is not incorporated into this Form 20-F dated June 16, 2022.
Item |
| Form 20-F caption |
| Location in the Annual Report and Form 20-F Information 2022 |
| Page |
1 | Identity of Directors, senior management and advisers | Not applicable | – | |||
2 | Offer statistics and expected timetable | Not applicable | – | |||
3 | Key information | |||||
3B Capitalisation and indebtedness | Not applicable | – | ||||
3C Reasons for the offer and use of proceeds | Not applicable | – | ||||
3D Risk factors | Risk factors | 59 to 64 | ||||
4 | Information on the Company | |||||
4A History and development of the Company | History and development | 240 | ||||
Contact details | Back cover | |||||
Shareholder information: Contact details for Equiniti and EQ Shareholder Services | 234 | |||||
Shareholder information: Articles of Association and applicable English law | 235 to 236 | |||||
Strategic review | 16 to 20 | |||||
Note 1 ‘Basis of preparation’ | 133 to 138 | |||||
Note 2 ‘Revenue disaggregation and segmental analysis’ | 139 to 144 | |||||
Note 7 ‘Discontinued operations and assets held for sale’ | 159 | |||||
Note 11 ‘Property, plant and equipment’ | 163 to 164 | |||||
Note 27 ‘Acquisitions and disposals’ | 199 to 200 | |||||
Note 28 ‘Commitments’ | 200 | |||||
Documents on display | 237 | |||||
4B Business overview | Our strategic framework | 1 | ||||
About Vodafone | 2 to 3 | |||||
Financial and non-financial performance | 4 to 5 | |||||
Chairman’s message | 6 | |||||
Chief Executive’s statement | 7 | |||||
Market and strategy | 8 to 9 | |||||
Mega trends | 12 to 13 | |||||
Strategic review | 16 to 20 | |||||
Our financial performance | 24 to 33 | |||||
Purpose, sustainability and responsible business | 34 to 58 | |||||
Note 2 ‘Revenue disaggregation and segmental analysis’ | 139 to 144 | |||||
Regulation | 240 to 248 | |||||
4C Organisation structure | Note 31 ‘Related undertakings’ | 205 to 213 | ||||
Note 12 ‘Investments in associates and joint arrangements’ | 165 to 170 | |||||
Note 13 ‘Other investments’ | 171 | |||||
4D Property, plant and equipment | Strategic review | 16 to 20 | ||||
Note 11 ‘Property, plant and equipment’ | 163 to 164 | |||||
4A | Unresolved staff comments | None | – |
Item |
| Form 20-F caption |
| Location in the Annual Report and Form 20-F Information 2022 |
| Page |
5 | Operating and financial review and prospects | |||||
5A Operating results | Our financial performance | 24 to 33 | ||||
Cyber security | 49 to 51 | |||||
Note 21 ‘Borrowings’ | 180 to 181 | |||||
Regulation | 240 to 248 | |||||
5B Liquidity and capital resources | Our financial performance: Cash flow and funding | 31 to 33 | ||||
Long-term viability statement | 65 | |||||
Directors’ statement of responsibility: Going concern | 118 | |||||
Note 19 ‘Cash and cash equivalents’ | 176 | |||||
Note 21 ‘Borrowings’ | 180 to 181 | |||||
Note 22 ‘Capital and financial risk management’ | 182 to 191 | |||||
Note 28 ‘Commitments’ | 200 | |||||
Note 29 ‘Contingent liabilities and legal proceedings’ | 200 to 203 | |||||
5C Research and development, | Strategic review | 16 to 20 | ||||
patents and licences etc. | Note 10 ‘Intangible assets’ | 161 to 162 | ||||
Regulation: Overview of spectrum licences | 247 | |||||
5D Trend information | Financial and non-financial performance | 4 to 5 | ||||
Mega trends | 12 to 13 | |||||
Long-term viability statement | 65 | |||||
5E Critical accounting estimates | Note 1 ‘Basis of preparation’ | 133 to 138 | ||||
6 | Directors, senior management and employees | |||||
6A Directors and senior management | Our Board | 73 to 74 | ||||
Our governance structure | 75 | |||||
Division of responsibilities | 76 | |||||
6B Compensation | Annual Report on Remuneration: 2022 Remuneration | 99 to 109 | ||||
Remuneration Policy | 93 to 98 | |||||
Note 23 ‘Directors and key management compensation’ | 191 to 192 | |||||
6C Board practices | Shareholder information: Articles of Association and applicable English law | 235 to 236 | ||||
Remuneration Policy | 93 to 98 | |||||
Our Board | 73 to 74 | |||||
Nominations and Governance Committee | 80 to 82 | |||||
Audit and Risk Committee | 83 to 88 | |||||
ESG Committee | 89 to 90 | |||||
Remuneration Committee | 91 to 92 | |||||
Our governance structure | 75 | |||||
Division of responsibilities | 76 | |||||
6D Employees | Our people strategy | 21 to 23 | ||||
Note 24 ‘Employees’ | 192 | |||||
6E Share ownership | Annual Report on Remuneration: 2022 Remuneration | 99 to 109 | ||||
Remuneration Policy | 93 to 98 | |||||
All-employee share plans | 103 | |||||
Note 26 ‘Share-based payments’ | 197 to 198 | |||||
7 | Major shareholders and related party transactions | |||||
7A Major shareholders | Shareholder information: Major shareholders | 235 | ||||
7B Related party transactions | Annual Report on Remuneration | 99 to 109 | ||||
Note 13 ‘Other investments’ | 171 | |||||
Note 23 ‘Directors and key management compensation’ | 191 to 192 | |||||
Note 29 ‘Contingent liabilities and legal proceedings’ | 200 to 203 | |||||
Note 30 ‘Related party transactions’ | 204 | |||||
7C Interests of experts and counsel | Not applicable | – |
Item |
| Form 20-F caption |
| Location in the Annual Report and Form 20-F Information 2022 |
| Page |
8 | Financial information | |||||
8A Consolidated statements and other | Consolidated financial statements | 129 to 214 | ||||
financial information | Report of independent registered public accounting firm | 125 to 128 | ||||
Note 29 ‘Contingent liabilities and legal proceedings’ | 200 to 203 | |||||
Dividend rights | 236 | |||||
8B Significant changes | Not applicable | – | ||||
9 | The offer and listing | |||||
9A Offer and listing details | Capital structure and rights attaching to shares | 114 | ||||
9B Plan of distribution | Not applicable | – | ||||
9C Markets | Capital structure and rights attaching to shares | 114 | ||||
9D Selling shareholders | Not applicable | – | ||||
9E Dilution | Not applicable | – | ||||
9F Expenses of the issue | Not applicable | – | ||||
11 | Quantitative and qualitative disclosures about market risk | Note 22 ‘Capital and financial risk management’ | 182 to 191 | |||
12 | Description of securities other than equity securities | |||||
12A Debt securities | Not applicable | – | ||||
12B Warrants and rights | Not applicable | – | ||||
12C Other securities | Not applicable | – | ||||
12D American depositary shares | Fees payable by ADR holders | Exhibit 2.6 | ||||
13 | Defaults, dividend arrearages and delinquencies | Not applicable | – | |||
14 | Material modifications to the rights of security holders and use of proceeds | Not applicable | – | |||
15 | Controls and procedures | Cyber security | 49 to 51 | |||
Governance | 68 to 115 | |||||
Directors’ statement of responsibility: Management’s report on internal control over financial reporting | 118 | |||||
Report of independent registered public accounting firm | 125 to 128 | |||||
16 | Reserved | |||||
16A Audit Committee financial expert | Audit and Risk Committee | 83 | ||||
16B Code of ethics | Our US listing requirements | 113 | ||||
16C Principal accountant fees and services | Note 3 ‘Operating profit’ | 145 | ||||
Board Committees: Audit and Risk Committee – External audit | 87 | |||||
16D Exemptions from the listing standards for audit committees | Not applicable | – | ||||
16E Purchase of equity securities by the issuer and affiliated purchasers | Share buybacks | 33 | ||||
16F Change in registrant’s certifying accountant | Not applicable | – | ||||
16G Corporate governance | Our US listing requirements | 113 | ||||
16H Mine safety disclosure | Not applicable | – | ||||
17 | Financial statements | Consolidated financial statements | 129 to 214 | |||
18 | Financial statements | Consolidated financial statements | 129 to 214 | |||
Report of independent registered public accounting firm | 125 to 128 | |||||
19 | Exhibits | Index of Exhibits | – |
Table of contents
Reports of independent registered public accounting firm (PCAOB ID 0 |
| |
The reports of the independent registered public accounting firm and the consolidated financial statements have been extracted, without adjustment, from pages 125 to 214 of the ‘Annual Report and Form 20-F Information 2022’ filed as exhibit 99.1.
F-1
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Vodafone Group Plc
Opinion on the Financial Statements
We have audited the accompanying consolidated statements of financial position of Vodafone Group Plc (the Group) as of 31 March 2022 and 2021, the related consolidated statements of income, comprehensive income, changes in equity and cash flows for each of the three years in the period ended 31 March 2022, and the related notes (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Group at 31 March 2022 and 2021, and the results of its operations and its cash flows for each of the three years in the period ended 31 March 2022, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Group’s internal control over financial reporting as of 31 March 2022, based on criteria established in Internal Control-Integrated Framework issued by the Committee of Sponsoring Organisations of the Treadway Commission (2013 framework) and our report dated 16 June 2022 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Group’s management. Our responsibility is to express an opinion on the Group’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgements. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
F-2
Carrying value of cash generating units, including goodwill
Description of the matter |
| As more fully described in Note 4 to the consolidated financial statements, in accordance with IAS 36 Impairment of Assets the Group calculates the value in use (‘VIU’) for cash generating units (‘CGUs’) to determine whether an adjustment to the carrying value of the CGU, and therefore, goodwill, is required. As of 31 March 2022, the Group has recorded €31,884 million of goodwill. The Group’s assessment of the VIU of its CGUs involves estimation and judgement about the future performance of the local market businesses. In particular, the determination of the VIUs was sensitive to the significant assumptions of projected adjusted EBITDAaL growth, long-term growth rates and discount rates. Auditing the Group’s annual impairment test was complex and involved significant auditor judgement, given the estimation uncertainty related to the significant assumptions described above and the sensitivity of certain VIU models to fluctuations in those assumptions, including where those CGUs had historical impairments, market specific events or other factors which resulted in low headroom. |
How we addressed the matter in our audit | We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Group’s goodwill impairment review process, including management’s controls over the significant assumptions described above. For the annual impairment assessment as at 31 March 2022 we tested, with the help of a valuation specialist, the methodology applied in the VIU models, as compared to the requirements of IAS 36, including the mathematical accuracy of management’s VIU models. We performed procedures to test and assess the significant assumptions used in the VIU models, which included evaluating projected adjusted EBITDAaL growth, for example by comparing underlying assumptions to external data such as economic and industry forecasts for the relevant markets and for consistency with evidence obtained from other areas of our audit. We also compared CGU EBITDAaL multiples to market listed peers and considered independent analyst valuations for individual CGUs, where available. For each CGU, we compared the cash flow projections used in the VIU models to the information approved by the Group’s Board of Directors and evaluated the historical accuracy of management’s business plans, which underpin the VIU models, by comparing prior year forecasts to actual results in the current period. With the assistance of a valuation specialist, we compared long-term growth rates and discount rates against EY independently determined ranges and performed sensitivity analyses on the above-described assumptions in the VIU models, to evaluate the parameters that, should they arise, would cause an impairment of the CGU or would indicate additional disclosures were appropriate. We also assessed the adequacy of the related disclosures provided in Note 4 of the consolidated financial statements, in particular the sensitivity disclosures in relation to reasonably possible changes in assumptions that could result in impairment. |
F-3
Revenue Recognition
Description of the matter |
| As more fully described in Note 2, Note 14 and Note 15 to the consolidated financial statements, the Group reported revenue of €45,580 million, contract assets of €3,551 million and contract liabilities of €2,521 million for the year ended and at, 31 March 2022. Management records revenue according to the principles of IFRS 15, Revenue from Contracts with Customers, including following the 5-step model, as described in the accounting policy in Note 2 to the consolidated financial statements. Auditing the revenue recorded by the Group is complex, due to the multiple IT systems and tools utilised in the initiation, processing and recording of transactions, which includes a high volume of individually low monetary value transactions, as well as the potential for significant postings outside of the aforementioned IT systems. Furthermore, judgement and the involvement of IT professionals was required to determine the audit approach to test and evaluate the relevant data that was captured and aggregated, and to assess the sufficiency of the audit evidence obtained. |
How we addressed the matter in our audit | We, together with our IT professionals, obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Group’s revenue recognition process, including controls over the appropriate flow of transactional data through the IT systems and tools and the reconciliation of the transactional data to the accounting records. In addition, our audit procedures included, on a sample basis, reperforming billing data to general ledger end-to-end reconciliations, which included assessing the accuracy of the data inputs to underlying source documentation, including contractual agreements, where relevant; testing the mathematical accuracy and completeness of the reconciliations and any material reconciling items, including significant revenue postings outside of the billing systems; and recalculating the revenue recognised to evaluate whether the processing of the revenue recognition by the Group’s IT systems and automated processes was in accordance with IFRS 15. |
F-4
Recoverability of deferred tax assets in Luxembourg
Description of the matter |
| As more fully described in Note 6 to the consolidated financial statements, the Group recognises deferred tax assets in accordance with IAS 12, Income Taxes, based on their estimated recoverability and whether management judges that it is probable that there will be sufficient and suitable taxable profits in the relevant legal entity or tax group against which to utilise the assets in the future. Deferred tax assets in Luxembourg of €16,298 million have been recognised in respect of losses, as management concluded it is probable that the Luxembourg entities will continue to generate taxable profits in the future, against which they can utilise these assets. Management estimates that the losses will be utilised over a period of 45 - 48 years. The Luxembourg companies’ income and therefore future taxable profits is derived from the Group’s internal financing and procurement and roaming activities. The forecast future finance income can vary based on forecast interest rates and intercompany debt levels, which in turn impacts the timeframe over which the deferred tax asset is forecast to be recovered. Furthermore, Luxembourg owns direct and indirect interests in the Group’s operating activities. The value of these investments is primarily based on the Group’s value in use calculations. Changes in the value for the purposes of local Luxembourg statutory financial statements can result in impairment reversals or charges, which are taxable or tax deductible, respectively, under local law. Auditing the Group’s recognition and recoverability of deferred tax assets in Luxembourg involves judgements and estimation uncertainty in relation to the availability of future taxable profits, the application of relevant tax transfer pricing and other laws and the period of time over which these assets will be utilised. |
How we addressed the matter in our audit |
| We obtained an understanding, evaluated the design, and tested the operating effectiveness of management’s controls around the recognition of deferred tax assets in Luxembourg, including the calculation of the gross amount of deferred tax assets recorded, the preparation of the prospective financial information used to determine the Luxembourg entities’ future taxable income, and management’s identification and use of available commercial strategies. To test the realisability of the deferred tax assets in Luxembourg, with the support of tax professionals, our audit procedures included, among others, assessing the existence of available losses, including the impact of current year taxable profits resulting from procurement, roaming and finance income and from the reversal of previously recognised impairments within the local statutory financial statements. Our procedures also included evaluating management’s position on the recoverability of the losses with respect to local tax law and tax planning strategies adopted, testing the calculation of the reversal of previous impairments by, among other procedures, agreeing the value in use calculations to our audit work performed on ‘Carrying value of cash generating units, including goodwill’ and assessing the Luxembourg ownership structure. We tested the reasonableness of the forecasted procurement and roaming taxable profits utilised in management’s realisability assessment, by comparing to historical actual profits and with evidence obtained from other areas of our audit. To evaluate the forecast finance income, our procedures included, on a sample basis, recalculating finance income with reference to underlying agreements, comparing future interest rates utilised in the forecasts to relevant external benchmarks and the assumed reductions in intergroup debt for consistency with our understanding of relevant guidance in respect of transfer pricing of financial transactions. We assessed whether evidence exists that is contrary to management’s stated intention that the financing structures will remain in place or that indicates it is not probable that sufficient future taxable profits will exist. We also assessed the adequacy of the disclosures in Note 6 of the consolidated financial statements, in respect of the Luxembourg deferred tax assets, against the requirements of IAS 12. |
/s/
We have served as the Group’s auditor since 2019.
16 June 2022
F-5
Report of Independent Registered Public Accounting Firm
To the Shareholders and the Board of Directors of Vodafone Group Plc
Opinion on Internal Control Over Financial Reporting
We have audited Vodafone Group Plc’s (the Group) internal control over financial reporting as of 31 March 2022, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, Vodafone Group Plc maintained, in all material respects, effective internal control over financial reporting as of 31 March 2022, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial position of the Group as of 31 March 2022 and 2021, the related consolidated statements of income, comprehensive income, changes in equity and cash flows for each of the three years in the period ended 31 March 2022, and the related notes and our report dated 16 June 2022 expressed an unqualified opinion thereon.
Basis for Opinion
The Group’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in Management’s report on Internal control over financial reporting on page 118. Our responsibility is to express an opinion on the Group’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Group in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorisations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorised acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst Young LLP
London, United Kingdom
16 June 2022
F-6
| |||
Consolidated income statement
for the years ended 31 March
2022 | 2021 | 2020 | ||||||||
Note | €m | €m | €m | |||||||
Revenue |
| 2 |
| |
| | | |||
Cost of sales |
|
|
| ( |
| ( | ( | |||
Gross profit |
|
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| |
| | | |||
Selling and distribution expenses |
|
|
| ( |
| ( | ( | |||
Administrative expenses |
|
|
| ( |
| ( | ( | |||
Net credit losses on financial assets | 22 | ( | ( | ( | ||||||
Share of results of equity accounted associates and joint ventures |
| 12 |
| |
| | ( | |||
Impairment loss |
| 4 |
| – |
| – | ( | |||
Other income |
| 3 |
| |
| | | |||
Operating profit |
| 3 |
| |
| | | |||
Non-operating expense |
|
|
| – |
| – | ( | |||
Investment income |
| 5 |
| |
| | | |||
Financing costs |
| 5 |
| ( |
| ( | ( | |||
Profit before taxation |
|
|
| |
| | | |||
Income tax expense |
| 6 |
| ( |
| ( | ( | |||
Profit/(loss) for the financial year |
|
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| |
| | ( | |||
Attributable to: |
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– Owners of the parent |
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| |
| | ( | |||
– Non-controlling interests |
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Profit/(loss) for the financial year |
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| | ( | |||
Earnings/(loss) per share |
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From continuing operations |
|
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| ||||||
– Basic |
| 8 |
| | c |
| | c | ( | c |
– Diluted |
| 8 |
| | c |
| | c | ( | c |
Total Group |
|
|
|
| ||||||
– Basic |
| 8 |
| | c |
| | c | ( | c |
– Diluted |
| 8 |
| | c |
| | c | ( | c |
Consolidated statement of comprehensive income
for the years ended 31 March
2022 | 2021 | 2020 | ||||||
Note | €m | €m | €m | |||||
Profit/(loss) for the financial year |
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| |
| |
| ( |
Other comprehensive income/(expense): |
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Items that may be reclassified to the income statement in subsequent years: |
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Foreign exchange translation differences, net of tax |
|
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| ( |
| |
| ( |
Foreign exchange translation differences transferred to the income statement |
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| ( |
| ( |
Other, net of tax1 |
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| |
| ( |
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Total items that may be reclassified to the income statement in subsequent years |
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| ( |
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Items that will not be reclassified to the income statement in subsequent years: |
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Net actuarial gains/(losses) on defined benefit pension schemes, net of tax |
| 25 |
| |
| ( |
| |
Total items that will not be reclassified to the income statement in subsequent years |
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| |
| ( |
| |
Other comprehensive income/(expense) |
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| |
| ( |
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Total comprehensive income/(expense) for the financial year |
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| ( |
| |
Attributable to: |
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– Owners of the parent |
|
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| |
| ( |
| |
– Non-controlling interests |
|
|
| |
| |
| |
|
|
| |
| ( |
| |
Note:
| 1 |
Further details on items in the consolidated statement of comprehensive income can be found in the consolidated statement of changes in equity on page 131.
Consolidated statement of financial position
at 31 March
31 March 2022 | 31 March 2021 | |||||
| Note |
| €m |
| €m | |
Non-current assets |
|
|
|
|
|
|
Goodwill |
| 10 |
| |
| |
Other intangible assets |
| 10 |
| |
| |
Property, plant and equipment |
| 11 |
| |
| |
Investments in associates and joint ventures |
| 12 |
| |
| |
Other investments |
| 13 |
| |
| |
Deferred tax assets |
| 6 |
| |
| |
Post employment benefits |
| 25 |
| |
| |
Trade and other receivables |
| 14 |
| |
| |
|
|
| |
| | |
Current assets |
|
|
|
| ||
Inventory |
|
| |
| | |
Taxation recoverable |
|
|
| |
| |
Trade and other receivables |
| 14 |
| |
| |
Other investments |
| 13 |
| |
| |
Cash and cash equivalents |
| 19 |
| |
| |
|
|
| |
| | |
Assets held for sale |
| 7 |
| |
| |
Total assets |
|
|
| |
| |
Equity |
|
|
|
| ||
Called up share capital |
| 17 |
| |
| |
Additional paid-in capital |
|
|
| |
| |
Treasury shares |
|
|
| ( |
| ( |
Accumulated losses |
|
|
| ( |
| ( |
Accumulated other comprehensive income |
|
|
| |
| |
Total attributable to owners of the parent |
|
|
| |
| |
Non-controlling interests |
|
|
| |
| |
Total equity |
|
|
| |
| |
| ||||||
Non-current liabilities |
|
|
|
| ||
Borrowings |
| 21 |
| |
| |
Deferred tax liabilities |
| 6 |
| |
| |
Post employment benefits |
| 25 |
| |
| |
Provisions |
| 16 |
| |
| |
Trade and other payables |
| 15 |
| |
| |
|
|
| |
| | |
Current liabilities |
|
|
|
| ||
Borrowings |
| 21 |
| |
| |
Financial liabilities under put option arrangements | 22 | | | |||
Taxation liabilities |
|
|
| |
| |
Provisions |
| 16 |
| |
| |
Trade and other payables |
| 15 |
| |
| |
|
|
| |
| | |
Total equity and liabilities |
|
|
| |
| |
The consolidated financial statements on pages 129 to 214 were approved by the Board of Directors and authorised for issue on 16 June 2022 and were signed on its behalf by:
/s/ Nick Read | /s/ Margherita Della Valle |
Nick Read | Margherita Della Valle |
Chief Executive | Chief Financial Officer |
Consolidated statement of changes in equity
for the years ended 31 March
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| ||
Additional | Accumulated other comprehensive income | Equity | Non- | |||||||||||||||||||
Share | paid-in | Treasury | Accumulated | Currency | Pensions | Revaluation | attributable | controlling | Total | |||||||||||||
capital1 | capital2 | shares | losses | reserve3 | reserve | surplus4 | Other5 | to owners | interests | equity | ||||||||||||
€m | €m | €m | €m | €m | €m | €m | €m | €m | €m | €m | ||||||||||||
1 April 2019 |
| |
| |
| ( |
| ( |
| |
| ( |
| |
| |
| |
| |
| |
Issue or reissue of shares |
| |
| |
| |
| ( |
| – |
| – |
| – |
| – |
| |
| – |
| |
Share-based payments |
| – |
| |
| – |
| – |
| – |
| – |
| – |
| – |
| |
| |
| |
Transactions with NCI in subsidiaries |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| – |
| ( |
| ( |
| ( |
Dividends |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| – |
| ( |
| ( |
| ( |
Comprehensive (expense)/income |
| – |
| – |
| – |
| ( |
| ( |
| |
| – |
| |
| |
| |
| |
(Loss)/profit |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| – |
| ( |
| |
| ( |
OCI - before tax | – | – | – | – | ( | | – | | | ( | | |||||||||||
OCI – taxes |
| – |
| – |
| – |
| – |
| |
| ( |
| – |
| ( |
| ( |
| ( |
| ( |
Transfer to the income statement |
| – |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| ( |
| |
| ( |
31 March 2020 |
| |
| |
| ( |
| ( |
| |
| ( |
| |
| |
| |
| |
| |
Issue or reissue of shares6 |
| – |
| ( |
| |
| ( |
| – |
| – |
| – |
| – |
| |
| – |
| |
Share-based payments |
| – |
| |
| – |
| – |
| – |
| – |
| – |
| – |
| |
| |
| |
Transactions with NCI in subsidiaries7 |
| – |
| – |
| – |
| |
| – |
| – |
| – |
| – |
| |
| |
| |
Dividends |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| – |
| ( |
| ( |
| ( |
Comprehensive income/(expense) |
| – |
| – |
| – |
| |
| |
| ( |
| – |
| ( |
| ( |
| |
| ( |
Profit |
| – |
| – |
| – |
| |
| – |
| – |
| – |
| – |
| |
| |
| |
OCI – before tax |
| – |
| – |
| – |
| – |
| |
| ( |
| – |
| ( |
| ( |
| – |
| ( |
OCI – taxes |
| – |
| – |
| – |
| – |
| |
| |
| – |
| |
| |
| |
| |
Transfer to the income statement |
| – |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| ( |
| ( |
| ( |
Purchase of treasury shares8 |
| – |
| – |
| ( | – | – | – | – | – | ( | – | ( | ||||||||
31 March 2021 |
| |
| |
| ( |
| ( |
| |
| ( |
| |
| ( |
| |
| |
| |
Issue or reissue of shares6 |
| – |
| ( |
| |
| ( |
| – |
| – |
| – |
| – |
| – |
| – |
| – |
Share-based payments |
| – |
| |
| – |
| – |
| – |
| – |
| – |
| – |
| |
| |
| |
Transactions with NCI in subsidiaries7 |
| – |
| – |
| – |
| ( |
| – |
| – |
| – |
| – |
| ( |
| |
| |
Dividends | – | – | – | ( | – | – | – | – | ( | ( | ( | |||||||||||
Comprehensive income/(expense) |
| – |
| – |
| – |
| |
| ( |
| |
| – |
| |
| |
| |
| |
Profit | – | – | – | | – |
| – |
| – |
| – |
| | | | |||||||
OCI - before tax |
| – |
| – |
| – |
| – |
| ( |
| |
| – |
| |
| |
| |
| |
OCI - taxes |
| – |
| – |
| – |
| – |
| – |
| ( |
| – |
| ( |
| ( |
| – |
| ( |
Transfer to the income statement |
| – |
| – |
| – |
| – |
| |
| – |
| – |
| – |
| |
| – |
| |
Purchase of treasury shares8 |
| – |
| – |
| ( |
| – |
| – |
| – |
| – |
| – |
| ( |
| – |
| ( |
31 March 2022 |
| |
| |
| ( |
| ( |
| |
| ( |
| |
| |
| |
| |
| |
Notes:
| 1 |
| 2 |
| 3 |
| 4 |
| 5 |
| 6 |
| 7 |
| 8 |
Consolidated statement of cash flows
for the years ended 31 March
2022 | 2021 | 2020 | ||||||
Note | €m | €m | €m | |||||
Inflow from operating activities |
| 18 |
| |
| |
| |
Cash flows from investing activities |
|
|
|
|
| |||
Purchase of interests in subsidiaries, net of cash acquired |
| 27 |
| – |
| ( |
| ( |
Purchase of interests in associates and joint ventures |
| 12 |
| ( |
| ( |
| ( |
Purchase of intangible assets |
|
| ( |
| ( |
| ( | |
Purchase of property, plant and equipment |
|
| ( |
| ( |
| ( | |
Purchase of investments |
|
| ( |
| ( |
| ( | |
Disposal of interests in subsidiaries, net of cash disposed |
| 27 |
| – |
| |
| |
Disposal of interests in associates and joint ventures |
|
|
| |
| |
| – |
Disposal of property, plant and equipment and intangible assets |
|
| |
| |
| | |
Disposal of investments |
|
|
| |
| |
| |
Dividends received from associates and joint ventures |
|
|
| |
| |
| |
Interest received |
|
|
| |
| |
| |
Outflow from investing activities |
|
|
| ( |
| ( |
| ( |
Cash flows from financing activities |
|
|
|
|
| |||
Proceeds from issue of long-term borrowings |
|
|
| |
| |
| |
Repayment of borrowings |
|
|
| ( |
| ( |
| ( |
Net movement in short-term borrowings |
|
|
| |
| ( |
| |
Net movement in derivatives | ( | | | |||||
Interest paid1 | ( | ( | ( | |||||
Payments for settlement of written put options2 | – | ( | – | |||||
Purchase of treasury shares | ( | ( | ( | |||||
Issue of ordinary share capital and reissue of treasury shares |
| 17 |
| – |
| |
| |
Equity dividends paid |
| 9 |
| ( |
| ( |
| ( |
Dividends paid to non-controlling shareholders in subsidiaries |
|
|
| ( |
| ( |
| ( |
Other transactions with non-controlling shareholders in subsidiaries |
| 27 |
| |
| |
| ( |
Other movements with associates and joint ventures |
|
|
| – |
| |
| |
Outflow from financing activities |
|
|
| ( |
| ( |
| ( |
Net cash inflow/(outflow) |
|
|
| |
| ( |
| ( |
Cash and cash equivalents at beginning of the financial year |
| 19 |
| |
| |
| |
Exchange gain/(loss) on cash and cash equivalents |
|
|
| |
| ( |
| ( |
Cash and cash equivalents at end of the financial year |
| 19 |
| |
| |
| |
Notes:
| 1 |
| 2 |
Notes to the consolidated financial statements | |
1. Basis of preparation
This section describes the critical accounting judgements and estimates that management has identified as having a potentially material impact on the Group’s consolidated financial statements and sets out our significant accounting policies that relate to the financial statements as a whole. Where an accounting policy is generally applicable to a specific note to the financial statements, the policy is described within that note. We have also detailed below the new accounting pronouncements that we will adopt in future years and our current view of the impact they will have on our financial reporting.
The consolidated financial statements are prepared in accordance with UK-adopted International Accounting Standards (‘IAS’), with International Financial Reporting Standards (‘IFRS’) as issued by the International Accounting Standards Board (‘IASB’) and with the requirements of the Companies Act 2006 (the ‘Act’). The consolidated financial statements are prepared on a going concern basis (see page 118).
Vodafone Group Plc is incorporated and domiciled in England and Wales (registration number 1833679). The registered address of the Company is Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, England.
IFRS requires the Directors to adopt accounting policies that are the most appropriate to the Group’s circumstances. These have been applied consistently to all the years presented, unless otherwise stated. In determining and applying accounting policies, Directors and management are required to make judgements and estimates in respect of items where the choice of specific policy, accounting judgement, estimate or assumption to be followed could materially affect the Group’s reported financial position, results or cash flows and disclosure of contingent assets or liabilities during the reporting period; it may later be determined that a different choice may have been more appropriate.
The Group’s critical accounting judgements and key sources of estimation uncertainty are detailed below. Actual outcomes could differ from those estimates. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period; they are recognised in the period of the revision and future periods if the revision affects both current and future periods.
Management regularly reviews, and revises as necessary, the accounting judgements that significantly impact the amounts recognised in the financial statements and the estimates that are considered to be ‘critical estimates’ due to their potential to give rise to material adjustments in the Group’s financial statements in the year to 31 March 2023. As at 31 March 2022, management has identified critical judgements in respect of revenue recognition, lease accounting, valuing assets and liabilities acquired in business combinations, the accounting for tax disputes in India, the classification of joint arrangements, whether to recognise provisions or to disclose contingent liabilities and the impacts of climate change. In addition, management has identified critical accounting estimates in relation to the recovery of deferred tax assets, post employment benefits and impairment reviews; estimates have also been identified that are not considered to be critical in respect of the allocation of revenue to goods and services, the useful economic lives of finite lived intangibles and property, plant and equipment.
The majority of the Group’s provisions are either long-term in nature (such as asset retirement obligations) or relate to shorter-term liabilities (such as those relating to restructuring and property) where there is not considered to be a significant risk of material adjustment in the next financial year. Critical judgements exercised in respect of tax disputes in India, include the cases relating to our acquisition of Hutchison Essar Limited (Vodafone India).
These critical accounting judgements, estimates and related disclosures have been discussed with the Group’s Audit and Risk Committee.
Critical accounting judgements and key sources of estimation uncertainty
Revenue recognition
Revenue recognition under IFRS 15 necessitates the collation and processing of very large amounts of data and the use of management judgements and estimates to produce financial information. The most significant accounting judgements and source of estimation uncertainty are disclosed below.
Notes to the consolidated financial statements (continued) | |||
Gross versus net presentation
If the Group has control of goods or services when they are delivered to a customer, then the Group is the principal in the sale to the customer; otherwise the Group is acting as an agent. Whether the Group is considered to be the principal or an agent in the transaction depends on analysis by management of both the legal form and substance of the agreement between the Group and its business partners; such judgements impact the amount of reported revenue and operating expenses (see note 2 ‘Revenue disaggregation and segmental analysis’) but do not impact reported assets, liabilities or cash flows. Scenarios requiring judgement to determine whether the Group is a principal or an agent include, for example, those where the Group delivers third-party branded software or services (such as premium music, TV content or cloud-based services) to customers and good or services delivered to customers in partnership with a third-party.
Allocation of revenue to goods and services provided to customers
Revenue is recognised when goods and services are delivered to customers (see note 2 ‘Revenue disaggregation and segmental analysis’). Goods and services may be delivered to a customer at different times under the same contract, hence it is necessary to allocate the amount payable by the customer between goods and services on a ‘relative standalone selling price basis’; this requires the identification of performance obligations (‘obligations’) and the determination of standalone selling prices for the identified obligations. The determination of obligations is, for the primary goods and services sold by the Group, not considered to be a critical accounting judgement; the Group’s policy on identifying obligations is disclosed in note 2 ‘Revenue disaggregation and segmental analysis’. The determination of standalone selling prices for identified obligations is discussed below.
It is necessary to estimate the standalone price when the Group does not sell equivalent goods or services in similar circumstances on a standalone basis. When estimating the standalone price the Group maximises the use of external inputs; methods for estimating standalone prices include determining the standalone price of similar goods and services sold by the Group, observing the standalone prices for similar goods and services when sold by third parties or using a cost-plus reasonable margin approach (which is sometimes the case for devices and other equipment). Where it is not possible to reliably estimate standalone prices due to a lack of observable standalone sales or highly variable pricing, which is sometimes the case for services, the standalone price of an obligation may be determined as the transaction price less the standalone prices of other obligations in the contract. The standalone price determined for obligations materially impacts the allocation of revenue between obligations and impacts the timing of revenue when obligations are provided to customers at different times – for example, the allocation of revenue between devices, which are usually delivered up-front, and services which are typically delivered over the contract period. However, there is not considered to be a significant risk of material adjustment to the carrying value of contract-related assets or liabilities in the 12 months after the balance sheet date if these estimates were revised.
Lease accounting
Lease accounting under IFRS 16 is complex and necessitates the collation and processing of very large amounts of data and the increased use of management judgements and estimates to produce financial information. The most significant accounting judgements are disclosed below.
Lease identification
Whether the arrangement is considered a lease or a service contract depends on the analysis by management of both the legal form and substance of the arrangement between the Group and the counter-party to determine if control of an identified asset has been passed between the parties; if not, the arrangement is a service arrangement. Control exists if the Group obtains substantially all of the economic benefit from the use of the asset, and has the ability to direct its use, for a period of time. An identified asset exists where an agreement explicitly or implicitly identifies an asset or a physically distinct portion of an asset which the lessor has no substantive right to substitute.
The scenarios requiring the greatest judgement include those where the arrangement is for the use of fibre or other fixed telecommunication lines. Generally, where the Group has exclusive use of a physical line it is determined that the Group can also direct the use of the line and therefore leases will be recognised. Where the Group provides access to fibre or other fixed telecommunication lines to another operator on a wholesale basis the arrangement will generally be identified as a lease, whereas when the Group provides fixed line services to an end-user, generally control over such lines is not passed to the end-user and a lease is not identified.
The impact of determining whether an agreement is a lease or a service depends on whether the Group is a potential lessee or lessor in the arrangement and, where the Group is a lessor, whether the arrangement is classified as an operating or finance lease. The impacts for each scenario are described below where the Group is potentially:
- | A lessee. The judgement impacts the nature and timing of both costs and reported assets and liabilities. A lease results in an asset and a liability being reported and depreciation and interest being recognised; the interest charge will decrease over the |
Notes to the consolidated financial statements (continued) | |
life of the lease. A service contract results in operating expenses being recognised evenly over the life of the contract and no assets or liabilities being recorded (other than trade payables, prepayments and accruals).
- | An operating lessor. The judgement impacts the nature of income recognised. An operating lease results in lease income being recognised whilst a service contract results in service revenue. Both are recognised evenly over the life of the contract. |
- | A finance lessor. The judgement impacts the nature and timing of both income and reported assets. A finance lease results in the lease income being recognised at commencement of the lease and an asset (the net investment in the lease) being recorded. |
Lease term
Where leases include additional optional periods after an initial lease term, significant judgement is required in determining whether these optional periods should be included when determining the lease term. The impact of this judgement is significantly greater where the Group is a lessee. As a lessee, optional periods are included in the lease term if the Group is reasonably certain it will exercise an extension option or will not exercise a termination option; this depends on an analysis by management of all relevant facts and circumstances including the leased asset's nature and purpose, the economic and practical potential for replacing the asset and any plans that the Group has in place for the future use of the asset. Where a leased asset is highly customised (either when initially provided or as a result of leasehold improvements) or it is impractical or uneconomic to replace then the Group is more likely to judge that lease extension options are reasonably certain to be exercised. The value of the right-of-use asset and lease liability will be greater when extension options are included in the lease term. The normal approach adopted for lease term by asset class is described below.
The lease terms can vary significantly by type and use of asset and geography. In addition, the exact lease term is subject to the non-cancellable period and rights and options in each contract. Generally, lease terms are judged to be the longer of the minimum lease term and:
- | Between |
- | To the next contractual lease break date for retail premises (excluding breaks within the next 12 months); |
- | Where leases are used to provide internal connectivity the lease term for the connectivity is aligned to the lease term or useful economic life of the assets connected; |
- | The customer service agreement length for leases of local loop connections or other assets required to provide fixed line services to individual customers; and |
- | Where there are contractual agreements to provide services using leased assets, the lease term for these assets is generally set in accordance with the above principles or for the lease term required to provide the services for the agreed service period, if longer. |
In most instances the Group has options to renew or extend leases for additional periods after the end of the lease term which are assessed using the criteria above.
Lease terms are reassessed if a significant event or change in circumstances occurs relating to the leased assets that is within the control of the Group; such changes usually relate to commercial agreements entered into by the Group, or business decisions made by the Group. Where such changes change the Group’s assessment of whether it is reasonably certain to exercise options to extend, or not terminate leases, then the lease term is reassessed and the lease liability is remeasured, which in most cases will increase the lease liability.
Taxation
The Group’s tax charge on ordinary activities is the sum of the total current and deferred tax charges. The calculation of the Group’s total tax charge involves estimation and judgement in respect of certain matters, being principally:
Recognition of deferred tax assets
Significant items on which the Group has exercised accounting estimation and judgement include the recognition of deferred tax assets in respect of losses in Luxembourg, Germany, Italy and Spain as well as capital allowances in the United Kingdom. The recognition of deferred tax assets, particularly in respect of tax losses, is based upon whether management judge that it is probable that there will be sufficient and suitable taxable profits in the relevant legal entity or tax group against which to utilise the assets in the future. The Group assesses the availability of future taxable profits using the same undiscounted
Notes to the consolidated financial statements (continued) | |||
In the case of Luxembourg, this includes forecasts of future income from the Group's internal financing, centralised procurement and roaming activities.
Where tax losses are forecast to be recovered beyond the
The estimated cash flows inherent in these forecasts include the unsystematic risks of operating in the telecommunications business including the potential impacts of changes in the market structure, trends in customer pricing, the costs associated with the acquisition and retention of customers, future technological evolutions and potential regulatory changes, such as our ability to acquire and/or renew spectrum licences.
Changes in the estimates which underpin the Group’s forecasts could have an impact on the amount of future taxable profits and could have a significant impact on the period over which the deferred tax asset would be recovered.
The Group only considers substantively enacted tax laws when assessing the amount and availability of tax losses to offset against the future taxable profits. See note 6 ‘Taxation’ to the consolidated financial statements.
See additional commentary relating to climate change on page 158.
Uncertain tax positions
The tax impact of a transaction or item can be uncertain until a conclusion is reached with the relevant tax authority or through a legal process. The Group uses in-house tax experts when assessing uncertain tax positions and seeks the advice of external professional advisors where appropriate. The most significant judgement in this area relates to the Group’s tax disputes in India, including the cases relating to the Group’s acquisition of Hutchison Essar Limited (Vodafone India). Further details of the tax disputes in India are included in note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements.
Business combinations and goodwill
When the Group completes a business combination, the fair values of the identifiable assets and liabilities acquired, including intangible assets, are recognised. The determination of the fair values of acquired assets and liabilities is based, to a considerable extent, on management's judgement. If the purchase consideration exceeds the fair value of the net assets acquired then the incremental amount paid is recognised as goodwill. If the purchase price consideration is lower than the fair value of the assets acquired then the difference is recorded as a gain in the income statement.
Allocation of the purchase price between finite lived assets (discussed below) and indefinite lived assets such as goodwill affects the subsequent results of the Group as finite lived intangible assets are amortised, whereas indefinite lived intangible assets, including goodwill, are not amortised.
See note 27 ‘Acquisitions and disposals’ to the consolidated financial statements for further details.
Joint arrangements
The Group participates in a number of joint arrangements where control of the arrangement is shared with one or more other parties. Judgement is required to classify joint arrangements in a separate legal entity as either a joint operation or as a joint venture, which depends on management’s assessment of the legal form and substance of the arrangement taking into account relevant facts and circumstances such as whether the owners have rights to substantially all the economic outputs and, in substance, settle the liabilities of the entity.
The classification can have a material impact on the consolidated financial statements. The Group’s share of assets, liabilities, revenue, expenses and cash flows of joint operations are included in the consolidated financial statements on a line-by-line basis, whereas the Group’s investment and share of results of joint ventures are shown within single line items in the consolidated statement of financial position and consolidated income statement respectively. See note 12 ‘Investments in associates and joint arrangements’ to the consolidated financial statements.
Finite lived intangible assets
Other intangible assets include amounts spent by the Group acquiring licences and spectrum, customer bases and the costs of purchasing and developing computer software.
Where intangible assets are acquired through business combinations and no active market for the assets exists, the fair value of these assets is determined by discounting estimated future net cash flows generated by the asset. Estimates relating to the future cash flows and discount rates used may have a material effect on the reported amounts of finite lived intangible assets.
Notes to the consolidated financial statements (continued) | |
Estimation of useful life
The useful life over which intangible assets are amortised depends on management’s estimate of the period over which economic benefit will be derived from the asset. Useful lives are periodically reviewed to ensure that they remain appropriate. Management’s estimates of useful life have a material impact on the amount of amortisation recorded in the year, but there is not considered to be a significant risk of material adjustment to the carrying values of intangible assets in the year to 31 March 2023 if these estimates were revised. The basis for determining the useful life for the most significant categories of intangible assets are discussed below.
Customer bases
The estimated useful life principally reflects management’s view of the average economic life of the customer base and is assessed by reference to customer churn rates. An increase in churn rates may lead to a reduction in the estimated useful life and an increase in the amortisation charge.
Capitalised software
For computer software, the estimated useful life is based on management’s view, considering historical experience with similar products as well as anticipation of future events which may impact their life such as changes in technology. The useful life will not exceed the duration of a licence.
Property, plant and equipment
Property, plant and equipment represents
Estimation of useful life
The depreciation charge for an asset is derived using estimates of its expected useful life and expected residual value, which are reviewed annually. Management’s estimates of useful life have a material impact on the amount of depreciation recorded in the year, but there is not considered to be a significant risk of material adjustment to the carrying values of property, plant and equipment in the year to 31 March 2023 if these estimates were revised.
Management determines the useful lives and residual values for assets when they are acquired, based on experience with similar assets and taking into account other relevant factors such as any expected changes in technology.
See additional commentary relating to climate change, below.
Post employment benefits
Management uses estimates when determining the Group’s liabilities and expenses arising for defined benefit pension schemes. Management is required to estimate the future rates of inflation, salary increases, discount rates and longevity of members, each of which may have a material impact on the defined benefit obligations that are recorded. Further details, including a sensitivity analysis, are included in note 25 ‘Post employment benefits’ to the consolidated financial statements.
Contingent liabilities
The Group exercises judgement to determine whether to recognise provisions and the exposures to contingent liabilities related to pending litigations or other outstanding claims subject to negotiated settlement, mediation, arbitration or government regulation, as well as other contingent liabilities (see note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements). Judgement is necessary to assess the likelihood that a pending claim will succeed, or a liability will arise.
Impairment reviews
IFRS requires management to perform impairment tests annually for indefinite lived assets, for finite lived assets and for equity accounted investments, if events or changes in circumstances indicate that their carrying amounts may not be recoverable.
A lack of observable market data on fair values for equivalent assets means that the Group’s valuation approach for impairment testing focuses primarily on value in use. For a number of reasons, transaction values agreed as part of any business acquisition or disposal may be higher than the assessed value in use. Where the Group has interests in listed entities, market data, such as share price, is used to assess the fair value of those interests.
For operations that are classified as held for sale, management is required to determine whether the carrying value of the discontinued operation can be supported by the fair value less costs to sell. Where not observable in a quoted market, management has determined fair value less costs to sell by reference to the outcomes from the application of a number of
Notes to the consolidated financial statements (continued) | |||
potential valuation techniques, determined from inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly.
Impairment testing requires management to judge whether the carrying value of assets can be supported by the net present value of future cash flows that they generate. Calculating the net present value of the future cash flows requires estimates to be made in respect of highly uncertain matters including management's expectations of:
| – | Growth in adjusted EBITDAaL, calculated as adjusted operating profit before depreciation and amortisation; |
| – | Timing and amount of future capital expenditure, licence and spectrum payments; |
| – | Long-term growth rates; and |
| – | Appropriate discount rates to reflect the risks involved. |
A long-term growth rate into perpetuity has been determined as the lower of:
| - | The nominal GDP growth rates for the country of operation; and |
| - | The long-term compound annual growth rate in adjusted EBITDAaL in years to , as estimated by management. |
Changing the assumptions selected by management, in particular the adjusted EBITDAaL and growth rate assumptions used in the cash flow projections, could significantly affect the Group’s impairment evaluation and hence reported assets and profits or losses. Further details, including a sensitivity analysis, are included in note 4 'Impairment losses' to the consolidated financial statements.
See additional commentary relating to climate change, below.
Climate change
The potential climate change-related risks and opportunities to which the Group is exposed, as identified by management, are disclosed in the Group’s TCFD disclosures on pages 66 and 67. Management has assessed the potential financial impacts relating to the identified risks, primarily considering the useful lives of, and retirement obligations for, property, plant and equipment, the possibility of impairment of goodwill and other long-lived assets and the recoverability of the Group’s deferred tax assets. Management has exercised judgement in concluding that there are no further material financial impacts of the Group’s climate-related risks and opportunities on the consolidated financial statements. These judgements will be kept under review by management as the future impacts of climate change depend on environmental, regulatory and other factors outside of the Group’s control which are not all currently known.
Significant accounting policies applied in the current reporting period that relate to the financial statements as a whole
Accounting convention
The consolidated financial statements are prepared on a historical cost basis except for certain financial and equity instruments that have been measured at fair value.
Basis of consolidation
The consolidated financial statements incorporate the financial statements of the Company, subsidiaries controlled by the Company (see note 31 ‘Related undertakings’ to the consolidated financial statements), joint operations that are subject to joint control and the results of joint ventures and associates (see note 12 ‘Investments in associates and joint arrangements’ to the consolidated financial statements).
Foreign currencies
The consolidated financial statements are presented in euro, which is also the Company’s functional currency. Each entity in the Group determines its own functional currency and items included in the financial statements of each entity are measured using that functional currency.
Transactions in foreign currencies are initially recorded at the functional currency rate prevailing at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are retranslated into the respective functional currency of the entity at the rates prevailing on the reporting period date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the initial transaction dates. Non-monetary items measured in terms of historical cost in a foreign currency are not retranslated.
Notes to the consolidated financial statements (continued) | |
Changes in the fair value of monetary securities denominated in foreign currency are analysed between translation differences and other changes in the carrying amount of the security. Translation differences are recognised in the consolidated income statement and other changes in carrying amount are recognised in the consolidated statement of comprehensive income.
Translation differences on non-monetary financial assets, such as investments in equity securities classified at fair value through other comprehensive income, are reported as part of the fair value gain or loss and are included in the consolidated statement of comprehensive income.
Share capital, share premium and other capital reserves are initially recorded at the functional currency rate prevailing at the date of the transaction and are not retranslated.
For the purpose of presenting consolidated financial statements, the assets and liabilities of entities with a functional currency other than euro are expressed in euro using exchange rates prevailing at the reporting period date.
Income and expense items and cash flows are translated at the average exchange rates for each month and exchange differences arising are recognised directly in other comprehensive income. On disposal of a foreign entity, the cumulative amount previously recognised in the consolidated statement of comprehensive income relating to that particular foreign operation is recognised in profit or loss in the consolidated income statement.
Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated accordingly.
The net foreign exchange loss recognised in the consolidated income statement for the year ended 31 March 2022 is €
Current or non-current classification
Assets are classified as current in the consolidated statement of financial position where recovery is expected within 12 months of the reporting date. All assets where recovery is expected more than 12 months from the reporting date and all deferred tax assets, goodwill and intangible assets, property, plant and equipment and investments in associates and joint ventures are reported as non-current.
Liabilities are classified as current unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date. For provisions, where the timing of settlement is uncertain, amounts are classified as non-current where settlement is expected more than 12 months from the reporting date. In addition, deferred tax liabilities and post-employment benefits are reported as non-current.
Inventory
Inventory is stated at the lower of cost and net realisable value. Cost is determined on the basis of weighted average costs and comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition.
New accounting pronouncements adopted on 1 April 2021
The Group adopted the following new accounting policies on 1 April 2021 to comply with amendments to IFRS. The accounting pronouncements, none of which had a material impact on the Group’s financial reporting on adoption, are:
– | Amendments to IFRS 16 ‘Covid-19-Related Rent Concessions’ and ‘Covid-19-Related Rent Concessions beyond 30 June 2021’; and |
– | Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 ‘Interest Rate Benchmark Reform - Phase 2’. |
New accounting pronouncements and basis of preparation changes to be adopted on or after 1 April 2022
The IASB has issued the following pronouncements for annual periods beginning on or after 1 January 2022:
– | Annual Improvements to IFRS Standards 2018-2020; |
– | Amendments to IAS 16 ‘Property, Plant and Equipment: Proceeds before Intended Use’; |
Notes to the consolidated financial statements (continued) | |||
– | Amendments to IAS 37 ‘Onerous Contracts - Cost of Fulfilling a Contract’; and |
– | Amendments to IFRS 3 ‘Reference to the Conceptual Framework’. |
These amendments have been endorsed by the UK Endorsement Board. The Group’s financial reporting will be presented in accordance with the above new standards from 1 April 2022. The changes are not expected to have a material impact on the consolidated income statement, consolidated statement of financial position or consolidated statement of cash flows.
In addition, it is expected that Turkey will meet the requirements to be designated as a hyper-inflationary economy under IAS 29 ‘Financial Reporting in Hyper-Inflationary Economies’ in the quarter to 30 June 2022 and that the Group’s financial reporting relating to Turkey during the year ending 31 March 2023 will be in accordance with IAS 29. Under IAS 29, Turkish Lira results and non-monetary asset and liability balances are revalued to present value equivalent local currency amounts (adjusted based on an inflation index) before translation to euros at reporting-date exchange rates.
New accounting pronouncements to be adopted on or after 1 April 2023
The following new standards and narrow-scope amendments have been issued by the IASB and are effective for annual periods beginning on or after 1 January 2023; they were not endorsed by the EU at 31 December 2020 and have not yet been endorsed by the UK Endorsement Board.
– | IFRS 17 ‘Insurance Contracts’ and Amendments to IFRS 17 ‘Insurance Contracts’; |
– | Amendments to IAS 1 ‘Classification of Liabilities as Current or Non-Current’; |
– | Amendments to IAS 1 ‘Disclosure of Accounting Policies’; |
– | Amendment to IAS 8 ‘Definition of Accounting Estimates’; and |
– | Amendment to IAS 12 ‘Deferred Tax related to Assets and Liabilities arising from a Single Transaction’. |
The Group is assessing the impact of these new standards and the Group’s financial reporting will be presented in accordance with these standards from 1 April 2023 as applicable.
2. Revenue disaggregation and segmental analysis
The Group’s businesses are managed on a geographical basis. Selected financial data is presented on this basis below.
Accounting policies
Revenue
When the Group enters into an agreement with a customer, goods and services deliverable under the contract are identified as separate performance obligations (‘obligations’) to the extent that the customer can benefit from the goods or services on their own and that the separate goods and services are considered distinct from other goods and services in the agreement. Where individual goods and services do not meet the criteria to be identified as separate obligations they are aggregated with other goods and/or services in the agreement until a separate obligation is identified. The obligations identified will depend on the nature of individual customer contracts, but might typically be separately identified for mobile handsets, other equipment such as set-top boxes and routers provided to customers and services provided to customers such as mobile and fixed line communication services. Where goods and services have a functional dependency (for example, a fixed line router can only be used with the Group’s services) this does not, in isolation, prevent those goods or services from being assessed as separate obligations. Activities relating to connecting customers to the Group’s network for the future provision of services are not considered to meet the criteria to be recognised as obligations except to the extent that the control of related equipment passes to customers.
The Group determines the transaction price to which it expects to be entitled in return for providing the promised obligations to the customer based on the committed contractual amounts, net of sales taxes and discounts. Where indirect channel dealers, such as retailers, acquire customer contracts on behalf of the Group and receive commission, any commissions that the dealer is compelled to use to fund discounts or other incentives to the customer are treated as payments to the customer when determining the transaction price and consequently are not included in contract acquisition costs.
The transaction price is allocated between the identified obligations according to the relative standalone selling prices of the obligations. The standalone selling price of each obligation deliverable in the contract is determined according to the prices that the Group would achieve by selling the same goods and/or services included in the obligation to a similar customer on a
Notes to the consolidated financial statements (continued) | |
standalone basis; where standalone selling prices are not directly observable, estimation techniques are used maximising the use of external inputs. See ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 for details. Revenue is recognised when the respective obligations in the contract are delivered to the customer and cash collection is considered probable. Revenue for the provision of services, such as mobile airtime and fixed line broadband, is recognised when the Group provides the related service during the agreed service period.
Revenue for device sales to end customers is generally recognised when the device is delivered to the end customer. For device sales made to intermediaries such as indirect channel dealers, revenue is recognised if control of the device has transferred to the intermediary and the intermediary has no right to return the device to receive a refund; otherwise revenue recognition is deferred until sale of the device to an end customer by the intermediary or the expiry of any right of return.
Where refunds are issued to customers they are deducted from revenue in the relevant service period.
When the Group has control of goods or services prior to delivery to a customer, then the Group is the principal in the sale to the customer. As a principal, receipts from, and payments to, suppliers are reported on a gross basis in revenue and operating costs. If another party has control of goods or services prior to transfer to a customer, then the Group is acting as an agent for the other party and revenue in respect of the relevant obligations is recognised net of any related payments to the supplier and recognised revenue represents the margin earned by the Group. See ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 for details.
Customers typically pay in advance for prepay mobile services and monthly for other communication services. Customers typically pay for handsets and other equipment either up-front at the time of sale or over the term of the related service agreement.
When revenue recognised in respect of a customer contract exceeds amounts received or receivable from a customer at that time a contract asset is recognised; contract assets will typically be recognised for handsets or other equipment provided to customers where payment is recovered by the Group via future service fees. If amounts received or receivable from a customer exceed revenue recognised for a contract, for example if the Group receives an advance payment from a customer, a contract liability is recognised.
When contract assets or liabilities are recognised, a financing component may exist in the contract; this is typically the case when a handset or other equipment is provided to a customer up-front but payment is received over the term of the related service agreement, in which case the customer is deemed to have received financing. If a significant financing component is provided to the customer, the transaction price is reduced and interest revenue is recognised over the customer’s payment period using an interest rate reflecting the relevant central bank rates and customer credit risk.
Contract-related costs
When costs directly relating to a specific contract are incurred prior to recognising revenue for a related obligation, and those costs enhance the ability of the Group to deliver an obligation and are expected to be recovered, then those costs are recognised on the statement of financial position as fulfilment costs and are recognised as expenses in line with the recognition of revenue when the related obligation is delivered.
The direct and incremental costs of acquiring a contract including, for example, certain commissions payable to staff or agents for acquiring customers on behalf of the Group, are recognised as contract acquisition cost assets in the statement of financial position when the related payment obligation is recorded. Costs are recognised as an expense in line with the recognition of the related revenue that is expected to be earned by the Group; typically this is over the customer contract period as new commissions are payable on contract renewal. Certain amounts payable to agents are deducted from revenue recognised (see above).
Revenue disaggregation and segmental income statement analysis
Revenue reported for the year includes revenue from contracts with customers, comprising service and equipment revenue, as well as other revenue items including revenue from leases and interest revenue arising from transactions with a significant financing component.
Notes to the consolidated financial statements (continued) | |||
The table below presents Revenue and Adjusted EBITDAaL for the year ended 31 March 2022 under the updated segmental reporting structure.
|
|
| Revenue from |
|
|
| Total |
| ||||||
Service | Equipment | contracts with | Other | Interest | segment | Adjusted | ||||||||
| revenue | revenue | customers | revenue1 | revenue | revenue | EBITDAaL | |||||||
31 March 2022 |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
Germany |
| |
| |
| |
| |
| |
| |
| |
Italy |
| |
| |
| |
| |
| |
| |
| |
UK |
| |
| |
| |
| |
| |
| |
| |
Spain |
| |
| |
| |
| |
| |
| |
| |
Other Europe |
| |
| |
| |
| |
| |
| |
| |
Vodacom |
| |
| |
| |
| |
| |
| |
| |
Other Markets |
| |
| |
| |
| |
| – |
| |
| |
Vantage Towers | – | – | – | | – | | | |||||||
Common Functions2 |
| |
| |
| |
| |
| |
| |
| ( |
Eliminations |
| ( |
| ( |
| ( |
| ( |
| – |
| ( |
| – |
Group | |
|
|
|
|
|
|
The table below presents Revenue and Adjusted EBITDAaL for the year ended 31 March 2022 under the previous segmental reporting structure.
|
|
| Revenue from |
|
|
| Total |
| ||||||
Service | Equipment | contracts with | Other | Interest | segment |
| Adjusted | |||||||
revenue | revenue | customers | revenue1 | revenue | revenue |
| EBITDAaL | |||||||
31 March 2022 | €m | €m | €m | €m | €m | €m |
| €m | ||||||
Germany |
| |
| |
| |
| |
| |
| | | |
Italy |
| |
| |
| |
| |
| |
| | | |
UK |
| |
| |
| |
| |
| |
| | | |
Spain |
| |
| |
| |
| |
| |
| | | |
Other Europe |
| |
| |
| |
| |
| |
| | | |
Vodacom |
| |
| |
| |
| |
| |
| | | |
Other Markets |
| |
| |
| |
| |
| – |
| | | |
Common Functions2 |
| |
| |
| |
| |
| |
| | ( | |
Eliminations |
| ( |
| ( |
| ( |
| ( |
| – |
| ( | – | |
Group |
| |
| |
| |
| |
| |
| | |
Notes:
| 1 | Other revenue includes lease revenue recognised under IFRS 16 ‘Leases’ (see note 20 ‘Leases’). |
| 2 | Comprises central teams and business functions. |
The tables below present Revenue and Adjusted EBITDAaL comparative information for the years ended 31 March 2021 and 31 March 2020 under the previous segmental reporting structure.
|
|
|
|
| Revenue from |
|
|
|
|
| Total |
| ||
Service | Equipment | contracts with | Other | Interest | segment | Adjusted | ||||||||
revenue | revenue | customers | revenue1 | revenue | revenue | EBITDAaL | ||||||||
31 March 2021 | €m | €m | €m | €m | €m | €m | €m | |||||||
Germany |
| |
| |
| |
| |
| |
| |
| |
Italy |
| |
| |
| |
| |
| |
| |
| |
UK |
| |
| |
| |
| |
| |
| |
| |
Spain |
| |
| |
| |
| |
| |
| |
| |
Other Europe |
| |
| |
| |
| |
| |
| |
| |
Vodacom |
| |
| |
| |
| |
| |
| |
| |
Other Markets |
| |
| |
| |
| |
| – |
| |
| |
Common Functions2 |
| |
| |
| |
| |
| – |
| |
| ( |
Eliminations |
| ( |
| ( |
| ( |
| ( |
| – |
| ( |
| – |
Group |
| |
| |
| |
| |
| |
| |
| |
Notes to the consolidated financial statements (continued) | |
|
|
| Revenue from |
|
|
| Total |
| ||||||
Service | Equipment | contracts with | Other | Interest | segment |
| Adjusted | |||||||
revenue | revenue | customers | revenue1 | revenue | revenue |
| EBITDAaL | |||||||
31 March 2020 | €m | €m | €m | €m | €m | €m |
| €m | ||||||
Germany |
| |
| |
| |
| |
| |
| | | |
Italy |
| |
| |
| |
| |
| |
| | | |
UK |
| |
| |
| |
| |
| |
| | | |
Spain |
| |
| |
| |
| |
| |
| | | |
Other Europe |
| |
| |
| |
| |
| |
| | | |
Vodacom |
| |
| |
| |
| |
| |
| | | |
Other Markets |
| |
| |
| |
| |
| |
| | | |
Common Functions2 |
| |
| |
| |
| |
| – |
| | | |
Eliminations |
| ( |
| ( |
| ( |
| ( |
| – |
| ( | – | |
Group |
| |
| |
| |
| |
| |
| | |
Notes:
1 | Other revenue includes lease revenue recognised under IFRS 16 ‘Leases’ (see note 20 ‘Leases’). |
2 | Comprises central teams and business functions. |
The total future revenue from the remaining term of Group’s contracts with customers for performance obligations not yet delivered to those customers at 31 March 2022 is €
Segmental analysis
The Group’s operating segments are established on the basis of those components of the Group that are evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The Group has determined the chief operating decision maker to be its Chief Executive. The Group has a single group of similar services and products, being the supply of communications services and related products.
Following the IPO of Vantage Towers A.G. (‘Vantage Towers’) in March 2021, the Group has updated its segmental reporting structure to reflect the way in which the Group now manages its operations with Vantage Towers now reported as a new segment within the Vodafone Group’s financial results. This change in reporting structure has taken effect for the year ended 31 March 2022 onwards. Total revenue is unaffected as charges from Vantage Towers to operating companies are eliminated on consolidation. There has been no change to the segmental presentation of amounts derived from the income statement for comparative periods, which remain as previously disclosed. Segmental information for the years ended 31 March 2021 and 31 March 2020 is presented on the previous basis of segmental reporting.
Revenue is attributed to a country based on the location of the Group company reporting the revenue. Transactions between operating segments are charged at arm’s-length prices.
With the exception of Vodacom, which is a legal entity encompassing South Africa and certain other smaller African markets, and Vantage Towers, which comprises companies providing mobile tower infrastructure in a number of European markets, segment information is primarily provided on the basis of geographic areas, being the basis on which the Group manages its worldwide interests.
The operating segments for Germany, Italy, UK, Spain, Vodacom and Vantage Towers are individually material for the Group and are each reporting segments for which certain financial information is provided. The aggregation of smaller operating segments into the Other Europe and Other Markets reporting segments reflects, in the opinion of management, the similar local market economic characteristics and regulatory environments for each of those operating segments as well as the similar products and services sold and comparable classes of customers. In the case of the Other Europe region (comprising Albania, Czech Republic, Greece, Hungary, Ireland, Portugal and Romania), this largely reflects membership or a close association with the European Union, while the Other Markets segment (comprising Egypt, Ghana and Turkey) largely includes developing economies with less stable economic or regulatory environments. Common Functions is a separate reporting segment and comprises activities which are undertaken primarily in central Group entities that do not meet the criteria for aggregation with other reporting segments.
Notes to the consolidated financial statements (continued) | |||
A reconciliation of adjusted EBITDAaL, the Group’s measure of segment profit, to the Group’s profit or loss before taxation for the financial year is shown below.
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Adjusted EBITDAaL |
| |
| |
| |
Restructuring costs | ( | ( | ( | |||
Interest on lease liabilities |
| |
| |
| |
Loss on disposal of owned assets |
| ( |
| ( |
| ( |
Depreciation and amortisation on owned assets |
| ( |
| ( |
| ( |
Share of results of equity accounted associates and joint ventures |
| |
| |
| ( |
Impairment losses |
| – |
| – |
| ( |
Other income |
| |
| |
| |
Operating profit |
| |
| |
| |
Non-operating expense | – | – | ( | |||
Investment income | | | | |||
Finance costs | ( | ( | ( | |||
Profit before taxation | | | |
Segmental assets
The tables below present the segmental assets for the year ended 31 March 2022 in line with our updated segmental reporting structure and under the previous basis of segmental reporting.
|
|
|
|
|
| Other |
| Depreciation |
|
| ||
Non-current | Capital | Right-of-use | additions to | and | ||||||||
assets1 | additions2 | asset additions | intangible assets3 | amortisation | Impairment loss | |||||||
31 March 2022 | €m | €m | €m | €m | €m | €m | ||||||
Germany | | | | – | | – | ||||||
Italy | | | | | | – | ||||||
UK | | | | | | – | ||||||
Spain | | | | | | – | ||||||
Other Europe | | | | | | – | ||||||
Vodacom | | | | – | | – | ||||||
Other Markets | | | | – | | – | ||||||
Vantage Towers | | | | – | | – | ||||||
Common Functions | | | | – | | – | ||||||
Group | | | | | | – | ||||||
|
|
|
|
| Other |
| Depreciation |
|
| |||
Non-current | Capital | Right-of-use | additions to | and | ||||||||
assets1 | additions2 | asset additions | intangible assets3 | amortisation | Impairment loss | |||||||
31 March 2022 | €m | €m | €m | €m | €m | €m | ||||||
Germany |
| |
| | |
| – |
| |
| – | |
Italy |
| |
| | |
| |
| |
| – | |
UK |
| |
| | |
| |
| |
| – | |
Spain |
| |
| | |
| |
| |
| – | |
Other Europe |
| |
| | |
| |
| |
| – | |
Vodacom |
| |
| | |
| – |
| |
| – | |
Other Markets |
| |
| | |
| – |
| |
| – | |
Common Functions |
| |
| | |
| – |
| |
| – | |
Group | | | | | | – |
Notes:
Notes to the consolidated financial statements (continued) | |
Segmental assets
The tables below present the comparative segmental assets for the years ended 31 March 2021 and 31 March 2020 under the previous segmental reporting structure.
Depreciation | ||||||||||||
| Non-current |
| Capital |
| Right-of-use |
| Other additions to |
| and |
|
| |
assets1 | additions2 | asset additions | intangible assets3 | amortisation | Impairment loss | |||||||
31 March 2021 | €m | €m | €m | €m | €m | €m | ||||||
Germany | | | | | | – | ||||||
Italy |
| |
| |
| |
| |
| |
| – |
UK |
| |
| |
| |
| – |
| |
| – |
Spain |
| |
| |
| |
| |
| |
| – |
Other Europe |
| |
| |
| |
| |
| |
| – |
Vodacom |
| |
| |
| |
| – |
| |
| – |
Other Markets |
| |
| |
| |
| |
| |
| – |
Common Functions |
| |
| |
| |
| – |
| |
| – |
Group |
| |
| |
| |
| |
| |
| – |
| Non-current |
| Capital |
| Right-of-use |
| Other additions to |
| Depreciation and |
|
| |
assets1 | additions2 | asset additions | intangible assets3 | amortisation | Impairment loss | |||||||
31 March 2020 |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
Germany | – | |||||||||||
Italy |
| |
| |
| |
| |
| |
| – |
UK |
| |
| |
| |
| – |
| |
| – |
Spain |
| |
| |
| |
| – |
| |
| ( |
Other Europe |
| |
| |
| |
| |
| |
| ( |
Vodacom |
| |
| |
| |
| |
| |
| – |
Other Markets |
| |
| |
| |
| |
| |
| – |
Common Functions |
| |
| |
| |
| – |
| |
| ( |
Group |
| |
| |
| |
| |
| |
| ( |
Notes:
1 | Comprises goodwill, other intangible assets and property, plant and equipment. |
2 | Includes additions to property, plant and equipment (excluding right-of-use assets,), computer software and development costs, reported within Intangible assets. |
3 | Includes additions to licences and spectrum and customer base acquisitions. |
3. Operating profit
Detailed below are the key amounts recognised in arriving at our operating profit
Notes to the consolidated financial statements (continued) | |||
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Amortisation of intangible assets (note 10) |
| |
| |
| |
Depreciation of property, plant and equipment (note 11): |
|
|
| |||
Owned assets |
| |
| |
| |
Leased assets |
| |
| |
| |
Impairment losses (note 4) |
| |
| – |
| |
Staff costs (note 24) |
| |
| |
| |
Amounts related to inventory included in cost of sales | | | | |||
Own costs capitalised attributable to the construction or acquisition of property, plant and equipment |
| ( |
| ( |
| ( |
Gain on disposal of Indus Towers Limited1 | | – | – | |||
Pledge arrangements in respect of Indus Towers Limited1 (note 29) | ( | ( | – | |||
Net gain on formation of TPG Telecom1 (note 12) | | | – | |||
Net gain on formation of Indus Towers Limited1 (note 12) | | | – | |||
Settlement of tender offer to KDG shareholders1 | | ( | – | |||
Net gain on disposal of Vodafone New Zealand1 | | – | ( | |||
Net gain on disposal of tower infrastructure in Italy1 | | – | ( | |||
Net gain on disposal of Vodafone Malta1 |
| |
| – |
| ( |
Note:
| 1 | Included in Other income and expense in the Consolidated income statement. |
The total remuneration of the Group's auditor, Ernst Young LLP and other member firms of Ernst Young Global Limited, for services provided to the Group during the year ended 31 March 2022 is analysed below.
2022 | 2021 | 2020 | ||||
Re-presented1 | ||||||
€m | €m | €m | ||||
Parent company |
| |
| |
| |
Subsidiaries2 |
| |
| |
| |
Subsidiaries - new accounting standards3 | – | – | | |||
Audit fees4 |
| |
| |
| |
Vantage Towers IPO5 | – | | | |||
Audit-related6 | | – | | |||
Corporate finance7 | – | – | | |||
Non-audit fees |
| |
| |
| |
Total fees |
| |
| |
| |
Notes:
| 1 | Audit fees of subsidiaries for the year ended 31 March 2021 have increased by € |
| 2 | During the year ended 31 March 2021, audit fees of € |
| 3 | Fees for the implementation of new accounting standards, notably IFRS 15 ‘Revenue from Contracts with Customers’ and IFRS 16 ‘Leases’. |
| 4 | Includes fees in connection with the interim review, preliminary announcement and controls audit required under Section 404 of the Sarbanes Oxley Act. In total this amounted to € |
| 5 | Fees incurred for IPO services relating to the IPO of Vantage Towers A.G. on 18 March 2021. |
| 6 | Fees for statutory and regulatory filings during the year. |
| 7 | At the time of the Board decision to recommend Ernst Young LLP as the statutory auditor for the year ended 31 March 2020 in February 2019, Ernst Young LLP were providing a range of services to the Group. All services that were prohibited by the Financial Reporting Council (‘FRC’) or Securities and Exchange Commission (‘SEC’) for a statutory auditor to provide ceased by 31 March 2019. All engagements that were not prohibited by the FRC or SEC but were not in accordance with the Group’s own internal approval policy for non-audit services, ceased early in the financial year ended 31 March 2020 to enable a smooth transition to alternative suppliers, where required. |
Notes to the consolidated financial statements (continued) | |
4. Impairment losses
Impairment occurs when the carrying value of assets is greater than the present value of the net cash flows they are expected to generate. We review the carrying value of assets for each country in which we operate at least annually. For further details of our impairment review process see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation’ to the consolidated financial statements.
Accounting policies
Goodwill
Goodwill is not subject to amortisation but is tested for impairment annually or whenever there is an indication that the asset may be impaired.
For the purpose of impairment testing, assets are grouped at the lowest levels for which there are separately identifiable cash flows, known as cash-generating units. The determination of the Group’s cash-generating units is primarily based on the geographic area where the Group supplies communications services and products. If cash flows from assets within one jurisdiction are largely independent of the cash flows from other assets in that same jurisdiction and management monitors performance separately, multiple cash-generating units are identified within that geographic area.
If the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. Impairment losses recognised for goodwill are not reversible in subsequent periods.
The recoverable amount is the higher of fair value less costs of disposal and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
Management prepares formal
Property, plant and equipment, finite lived intangible assets and equity accounted investments
At each reporting period date, the Group reviews the carrying amounts of its property, plant and equipment, finite lived intangible assets and equity- accounted investments to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent, if any, of the impairment loss. Where it is not possible to estimate the recoverable amount of an individual asset, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
If the recoverable amount of an asset or cash-generating unit is estimated to be less than its carrying amount, the carrying amount of the asset or cash-generating unit is reduced to its recoverable amount and an impairment loss is recognised immediately in the income statement.
Where there has been a change in the estimates used to determine recoverable amount and an impairment loss subsequently reverses, the carrying amount of the asset or cash-generating unit is increased to the revised estimate of its recoverable amount, not to exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset or cash-generating unit in prior years and an impairment loss reversal is recognised immediately in the income statement.
Notes to the consolidated financial statements (continued) | |||
Impairment losses
Following our annual impairment review, the impairment charges recognised in the consolidated income statement within operating profit are stated below. Further detail on the events and circumstances that led to the recognition of the impairment charges is included below.
| 2022 | 2021 | 2020 | |||||
Cash-generating unit | Reportable segment | €m | €m | €m | ||||
Spain |
| Spain |
| – |
| – |
| |
Ireland | Other Europe | – | – | | ||||
Romania | Other Europe | – | – | | ||||
Vodafone Automotive | Common Functions | – | – | | ||||
|
|
| – |
| – |
| |
Goodwill
The remaining carrying value of goodwill at 31 March was as follows:
2022 | 2021 | |||
€m | €m | |||
Germany |
| |
| |
Vantage Towers Germany | | | ||
Italy |
| |
| |
Other |
| |
| |
| |
| |
Key assumptions used in the value in use calculations
The key assumptions used in determining the value in use are:
Assumption | How determined | |
Projected adjusted EBITDAaL | Projected adjusted EBITDAaL has been based on past experience adjusted for the following: | |
– In Europe, mobile revenue is expected to benefit from increased usage as customers transition to higher data bundles, and new products and services are introduced. Fixed revenue is expected to continue to grow as penetration is increased and more products and services are sold to customers; | ||
– Outside of Europe, revenue is expected to continue to grow as the penetration of faster data-enabled devices rises along with higher data bundle attachment rates, and new products and services are introduced. The Other Markets segment is also expected to benefit from increased usage and penetration of M-Pesa in Africa; and | ||
– Margins are expected to be impacted by negative factors such as the cost of acquiring and retaining customers in increasingly competitive markets and by positive factors such as the efficiencies expected from the implementation of Group initiatives. | ||
Projected capital expenditure | The cash flow forecasts for capital expenditure are based on past experience and include the ongoing capital expenditure required to maintain our networks, provide products and services in line with customer expectations, including of higher data volumes and speeds, and to meet the population coverage requirements of certain of the Group’s licences. In Europe, capital expenditure is required to roll out capacity-building next generation 5G and gigabit networks. Outside of Europe, capital expenditure will be required for the continued rollout of current and next generation mobile networks in emerging markets. Capital expenditure includes cash outflows for the purchase of property, plant and equipment and computer software. | |
Projected licence and spectrum payments | To enable the continued provision of products and services, the cash flow forecasts for licence and spectrum payments for each relevant cash-generating unit include amounts for expected renewals and newly available spectrum. Beyond the | |
Long-term growth rate | For the purposes of the Group’s value in use calculations, a long‑term growth rate into perpetuity is applied immediately at the end of the | |
– the nominal GDP growth rate forecasts for the country of operation; and | ||
– the long-term compound annual growth rate in adjusted EBITDAaL as estimated by management. | ||
Long-term compound annual growth rates determined by management may be lower than forecast nominal GDP growth rates due to the following market-specific factors: competitive intensity levels, maturity of business, regulatory environment or sector-specific inflation expectations. |
Notes to the consolidated financial statements (continued) | |
Pre-tax risk adjusted discount rate | The discount rate applied to the cash flows of each of the Group’s cash-generating units is generally based on the risk free rate for | |
These rates are adjusted for a risk premium to reflect both the increased risk of investing in equities and the systematic risk of the specific cash-generating unit. In making this adjustment, inputs required are the equity market risk premium (that is the required return over and above a risk free rate by an investor who is investing in the market as a whole) and the risk adjustment, beta, applied to reflect the risk of the specific cash-generating unit relative to the market as a whole. | ||
In determining the risk adjusted discount rate, management has applied an adjustment for the systematic risk to each of the Group’s cash-generating companies determined using an average of the betas of comparable listed telecommunications companies and, where available and appropriate, across a specific territory. Management has used a forward-looking equity market risk premium that takes into consideration both studies by independent economists, the long-term average equity market risk premium and the market risk premiums typically used by valuations practitioners. The risk adjusted discount rate is also based on typical leverage ratios of telecommunications companies in each cash-generating units’ respective market or region. |
Year ended 31 March 2022
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. At each reporting period date 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.
As a large owner of infrastructure and consumer of energy, the Group has exposure to climate change related risks such as energy cost increases, asset damage and service disruption. The long range plans used in the Group’s impairment testing include forecast energy costs and other costs that are embedded in the planning process to deliver the Group’s zero carbon targets. The long range plans also include capital expenditure in relation to the Group’s use of durable and energy efficient infrastructure and the costs of the Group’s extensive and ongoing network maintenance programme. Furthermore, the Group will continue to develop strong reactive initiatives to manage the unpredictable impacts of future climate-related risks. Climate change, therefore, has not had a material impact on the outcome of the Group’s impairment testing and the Group will continue to refine its approach to modelling climate-related risks and opportunities in the value in use calculations.
As the war in Ukraine continues, it is challenging to predict the full extent and duration of its impact on the economy and the Group’s businesses. However, to assess a potential impact of this on the Group’s impairment testing, management prepared scenario analysis based on adjustments to the long range plans for high level estimates of market risks impacted by the war. This analysis did not indicate a risk of impairment at 31 March 2022. Management will update the cash flows and assumptions used in the Group’s impairment testing at future reporting dates with latest best estimates.
No impairments were recognised for the Group’s cash generating units during the year to 31 March 2022.
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 calculation | ||||||||
Vantage Towers | ||||||||
| Germany |
| Italy |
| Germany |
| Other | |
% |
| % | % | % | ||||
Pre-tax risk adjusted discount rate | |
| |
| |
| ||
Long-term growth rate | |
| |
| |
| ||
Projected adjusted EBITDAaL1 | ( |
| ( |
| |
| ( | |
Projected capital expenditure2 |
|
|
| |||||
Notes to the consolidated financial statements (continued) | |||
Sensitivity analysis
The estimated recoverable amounts of the Group’s operations in Germany, Italy, the UK and Spain exceed their carrying values by €
| Change required for carrying value to equal recoverable amount | |||||||
| Germany |
| Italy |
| UK |
| Spain | |
pps | pps | pps | pps | |||||
Pre-tax risk adjusted discount rate | |
| |
| |
| | |
Long-term growth rate | ( |
| ( |
| ( |
| ( | |
Projected adjusted EBITDAaL1 | ( |
| ( |
| ( |
| ( | |
Projected capital expenditure2 | |
| |
| |
| | |
Notes:
1 | Projected Adjusted EBITDAaL 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. For the purposes of this disclosure Italy’s FY22 EBITDAaL excludes the TIM settlement. |
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, Italy, the UK and Spain management has considered the following reasonably possible changes in pre-tax adjusted discount rate, adjusted EBITDAaL1 and long-term growth rate assumptions, leaving all other assumptions unchanged. The sensitivity analysis presented is prepared on the basis that the reasonably possible change in each key assumption would not have a consequential impact on other assumptions used in the impairment review. The associated impact on the impairment assessment is presented in the table overleaf.
Management has concluded that no reasonably possible or foreseeable change in projected capital expenditure2 would cause the difference between the carrying value and recoverable amount for any cash-generating unit to be materially different to the base case disclosed overleaf.
Recoverable amount less carrying value | ||||||||
Germany | Italy | UK | Spain | |||||
| €bn |
| €bn |
| €bn |
| €bn | |
Base case as at 31 March 2022 | | | | |||||
Change in pre-tax risk adjusted discount rate | ||||||||
Decrease by 1pps | | | | |||||
Increase by 1pps | | ( | | ( | ||||
Change in long-term growth rate | ||||||||
Decrease by 1pps | | ( | | ( | ||||
Increase by 1pps | | | | |||||
Change in projected adjusted EBITDAaL1 | ||||||||
Decrease by 5pps | ( | ( | ( | ( | ||||
Increase by 5pps | | | | |||||
Note:
1 | Projected Adjusted EBITDAaL 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. For the purposes of this disclosure, EBITDAaL for Italy in the year ended 31 March 2022 excludes the TIM settlement. |
Year ended 31 March 2021
The disclosures below for the year ended 31 March 2021 are as previously disclosed in the 31 March 2021 Annual Report.
Following the carve-out of Vodafone’s tower infrastructure to Vantage Towers A.G. (‘Vantage Towers’) during the year in Germany, Spain, Portugal, Ireland, Greece, Romania, Czech Republic and Hungary and the acquisitions by Vantage Towers of Vodafone UK’s
Goodwill has been allocated on a relative values basis to the Vantage Towers cash-generating units, where applicable, as part of the tower business carve out from Vodafone’s operations. The cash-generating units described below relate to Vodafone’s mobile and fixed line trading businesses, unless otherwise indicated as being part of Vantage Towers.
Notes to the consolidated financial statements (continued) | |
Value in use assumptions
The table below shows key assumptions used in the value in use calculations.
Assumptions used in value in use calculation | ||||||||||||
Vantage Towers | ||||||||||||
Germany | Italy | Spain | Ireland | Romania | Germany | |||||||
% | % | % | % | % | % | |||||||
Pre-tax risk adjusted discount rate |
| |
| |
| |
| |
| |
| |
Long-term growth rate |
| |
| |
| |
| |
| |
| |
Projected adjusted EBITDAaL1 |
| |
| |
| |
| |
| |
| |
Projected capital expenditure2 |
|
|
|
|
|
| ||||||
Notes:
1 | Projected Adjusted EBITDAaL 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. A pro-rata adjustment has been made to true-up 31 March 2021 Adjusted EBITDAaL to a full year where the towers business carve-out occurred during the year. |
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. |
Sensitivity analysis
The estimated recoverable amounts of the Group’s operations in Germany, Italy, Spain, Ireland, Romania and Vantage Towers Germany exceed their carrying values by €
Change required for carrying value to equal recoverable amount | ||||||||||||
Vantage Towers | ||||||||||||
Germany | Italy | Spain | Ireland | Romania | Germany | |||||||
| pps |
| pps |
| pps |
| pps |
| pps |
| pps | |
Pre-tax risk adjusted discount rate | |
| |
| |
| |
| |
| | |
Long-term growth rate | ( |
| ( | ( | ( |
| ( |
| ( | |||
Projected adjusted EBITDAaL1 | ( |
| ( | ( | ( |
| ( |
| ( | |||
Projected capital expenditure2 | |
| | | |
| |
| | |||
Management considered the following reasonably possible changes in key assumptions for projected adjusted EBITDAaL1 and long-term growth rate, leaving all other assumptions unchanged. Consistent with the prior year, and due to the uncertainty of future COVID-19 impacts, management’s range of reasonably possible changes in projected adjusted EBITDAaL is plus or minus 5 percentage points (2020: +/- 5 percentage points). The sensitivity analysis presented is prepared on the basis that the reasonably possible change in each key assumption would not have a consequential impact on other assumptions used in the impairment review. The associated impact on the impairment assessment is presented in the table below.
Management believes that no reasonably possible or foreseeable change in the pre-tax adjusted discount rate or projected capital expenditure2 would cause the difference between the carrying value and recoverable amount for any cash-generating unit to be materially different from the base case disclosed below.
Recoverable amount less carrying value | ||||||||||||
Vantage Towers | ||||||||||||
Germany | Italy | Spain | Ireland | Romania | Germany | |||||||
| €bn |
| €bn |
| €bn |
| €bn |
| €bn |
| €bn | |
Base case as at 31 March 2021 |
| |
| |
| |
| |
| |
| |
Change in projected adjusted EBITDAaL1 |
|
|
|
|
|
|
|
|
|
|
|
|
Decrease by 5pps |
| ( |
| ( |
| ( |
| ( |
| ( |
| |
Increase by 5pps |
| |
| |
| |
| |
| |
| |
Change in long-term growth rate |
|
|
|
|
|
|
|
|
|
|
|
|
Decrease by 1pps |
| |
| ( |
| ( |
| – |
| – |
| |
Increase by 1pps |
| |
| |
| |
| |
| |
| |
The carrying values for Vodafone UK, Portugal, Czech Republic, and Hungary include goodwill arising from acquisitions and/or the purchase of operating licences or spectrum rights. The recoverable amounts for these operating companies are also not materially greater than their carrying values and accordingly are disclosed below.
Notes to the consolidated financial statements (continued) | |||
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 in the year ended 31 March 2021.
Change required for carrying value to equal recoverable amount | ||||||||
| UK |
| Portugal |
| Czech Republic |
| Hungary | |
| pps |
| pps |
| pps |
| pps | |
Pre-tax risk adjusted discount rate |
| |
| |
| |
| |
Long-term growth rate |
| ( |
| ( |
| ( |
| ( |
Projected adjusted EBITDAaL1 |
| ( |
| ( |
| ( |
| ( |
Projected capital expenditure2 |
| |
| |
| |
| |
Notes:
| 1 | Projected adjusted EBITDAaL 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. A pro-rata adjustment has been made to true up 31 March 2021 adjusted EBITDAaL to a full year where the towers business carve-out occurred during the year. |
| 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. |
Year ended 31 March 2020
The disclosures below for the year ended 31 March 2020 are as previously disclosed in the 31 March 2020 Annual Report.
For the year ended 31 March 2020, the Group recorded impairment charges of €
The COVID-19 outbreak developed rapidly in early 2020. Many countries have required businesses to limit or suspend operations and implemented travel restrictions and quarantine measures. The measures taken to contain the virus have adversely affected economic activity and disrupted many businesses. As the outbreak continues to progress and evolve, it is extremely challenging to predict the full extent and duration of its impact on Vodafone’s businesses and the countries where Vodafone operates. Based on information available as at 31 March 2020, management made additional adjustments to the five year business plans used in the Group’s impairment testing in order to reflect the estimated impact. The impairment charges recognised and discussed immediately below, were based on expected cash flows after applying these adjustments.
Challenging trading and economic conditions in Spain materialised in the prior financial year and management recognised an impairment charge following a reduction in projected cash flows. During the year ended 31 March 2020 there was an observable repositioning towards low-cost brands and competitive intensity within the multi-branded market was expected to remain elevated in the medium term. These factors led to management projecting lower cash flows and recognising an impairment charge with respect to the Group’s investment in Spain.
The impairment charge recognised with respect to Ireland was attributable to increased competition and the aforementioned increased economic uncertainty. As a consequence, growth and ARPUs were expected to be lower. Management reflected these assumptions in expected cash flows.
The impairment charges recognised with respect to Romania and Vodafone Automotive reflect management’s latest assessment of likely trading and economic conditions in the five year business plan. Management’s view of the long-term potential in these markets remains unchanged.
The European Liberty Global assets acquired in July 2019 were subsumed within existing cash-generating units in Germany, Czech Republic, Hungary and Romania. The primary reason for acquiring the businesses was to create a converged national provider of digital infrastructure in Germany, together with creating converged communications operators in the Czech Republic, Hungary and Romania. Following the integration of the acquired businesses, management considered the cash flows within these cash-generating units to be largely interdependent and monitors performance on a country-level basis.
On 31 March 2020, the Group merged its passive tower infrastructure in Italy with INWIT. On the date of the merger, management monitored performance of its operations in Italy on a country-wide basis and considered Vodafone Italy, including its passive tower infrastructure, to be one cash-generating unit for the purpose of impairment testing as at 31 March 2020. No impairment in relation to Vodafone Italy would be necessary if impairment testing was performed on a post-merger basis at 31 March 2020.
Notes to the consolidated financial statements (continued) | |
Value in use assumptions
The table below shows key assumptions used in the value in use calculations.
Assumptions used in value in use calculation | ||||||||||||
|
|
|
|
|
| Vodafone | ||||||
Germany | Italy | Spain | Ireland | Romania | Automotive | |||||||
% |
| % |
| % |
| % |
| % |
| % | ||
Pre-tax risk adjusted discount rate |
| | | | | | | |||||
Long-term growth rate |
| | | | | | | |||||
Projected adjusted EBITDAaL1 |
| | | | | | | |||||
Projected capital expenditure2 |
| |||||||||||
Notes:
1 | Projected Adjusted EBITDAaL 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. |
Sensitivity analysis
The estimated recoverable amount of the Group’s operations in Germany and Italy exceed their carrying values by €
Change required for carrying value to | ||||
| equal recoverable amount | |||
Germany | Italy | |||
pps | pps | |||
Pre-tax risk adjusted discount rate |
| |
| |
Long-term growth rate |
| ( |
| ( |
Projected adjusted EBITDAaL1 |
| ( |
| ( |
Projected capital expenditure2 |
| |
| |
Management considered the following reasonably possible changes in the key adjusted EBITDAaL1 and long-term growth rate assumptions, leaving all other assumptions unchanged. Due to increased uncertainty following the COVID-19 outbreak, management has widened the range of reasonably possible changes in the key adjusted EBITDAaL growth rate assumption to plus or minus 5 percentage points (2019: 2 percentage points). The sensitivity analysis presented is prepared on the basis that the reasonably possible change in each key assumption would not have a consequential impact on other assumptions used in the impairment review. The associated impact on the impairment assessment is presented in the table below, with the exception of Vodafone Automotive, where no reasonably possible change in the key assumptions would materially change the impairment charge recognised.
Management believes that no reasonably possible or foreseeable change in the pre-tax adjusted discount rate or projected capital expenditure2 would cause the difference between the carrying value and recoverable amount for any cash-generating unit to be materially different to the base case disclosed below.
Recoverable amount less carrying value (prior to recognition of impairment charges) | ||||||||||
Germany | Italy | Spain | Ireland | Romania | ||||||
| €bn |
| €bn |
| €bn |
| €bn |
| €bn | |
Base case as at 31 March 2020 |
| |
| |
| ( |
| ( |
| ( |
Change in projected adjusted EBITDAaL1 |
|
|
|
|
|
|
|
|
|
|
Decrease by 5pps |
| ( |
| ( |
| ( |
| ( |
| ( |
Increase by 5pps |
| |
| |
| |
| – |
| |
Change in long-term growth rate |
|
|
|
|
|
|
|
|
|
|
Decrease by 1pps |
| |
| |
| ( |
| ( |
| ( |
Increase by 1pps |
| |
| |
| – |
| ( |
| – |
The carrying values for Vodafone UK, Portugal, Czech Republic and Hungary include goodwill arising from acquisitions and/or the purchase of operating licences or spectrum rights. While the recoverable amounts for these operating companies are not materially greater than their carrying value, each has a lower risk of giving rise to an impairment that would be material to the Group given their relative size or the composition of their carrying value.
Notes to the consolidated financial statements (continued) | |||
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 in the year ended 31 March 2020.
Change required for carrying value to equal recoverable amount | ||||||||
| UK |
| Portugal |
| Czech Republic |
| Hungary | |
pps | pps | pps | pps | |||||
Pre-tax risk adjusted discount rate |
| |
| |
| |
| |
Long-term growth rate |
| ( |
| ( |
| ( |
| ( |
Projected adjusted EBITDAaL1 |
| ( |
| ( |
| ( |
| ( |
Projected capital expenditure2 |
| |
| |
| |
| |
Notes:
1 | Projected adjusted EBITDAaL 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. |
VodafoneZiggo
The recoverable amount for VodafoneZiggo is not materially greater than its carrying value. If adverse impacts of economic, competitive, regulatory or other factors were to cause significant deterioration in the operations of VodafoneZiggo and the entity’s expected future cash flows, this may lead to an impairment loss being recognised.
5. Investment income and financing costs
Investment income comprises interest received from short-term investments and other receivables. Financing costs mainly arise from interest due on bonds and commercial paper issued, bank loans and the results of hedging transactions used to manage foreign exchange and interest rate movements.
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Investment income |
|
|
|
|
|
|
Financial assets measured at amortised cost |
| |
| |
| |
Financial assets measured at fair value through profit and loss |
| |
| |
| |
| |
| |
| | |
Financing costs |
|
|
|
|
|
|
Financial liabilities measured at amortised cost |
|
|
|
| ||
Bonds | | | | |||
Lease liabilities | | | | |||
Bank loans and other liabilities1 |
| |
| |
| |
Interest on derivatives |
| ( |
| ( |
| ( |
Mark-to-market on derivatives |
| ( |
| ( |
| |
Financial assets measured at fair value through profit and loss | | – | – | |||
Foreign exchange |
| |
| |
| |
| |
| |
| | |
Net financing costs |
| |
| |
| |
Note:
1 | Interest capitalised for the year ended 31 March 2022 was € |
Notes to the consolidated financial statements (continued) | |
6. Taxation
This note explains how our Group tax charge arises. The deferred tax section of the note also provides information on our expected future tax charges and sets out the tax assets held across the Group together with our view on whether or not we expect to be able to make use of these in the future.
Accounting policies
Income tax expense represents the sum of the current and deferred taxes.
Current tax payable or recoverable is based on taxable profit for the year. Taxable profit differs from profit as reported in the income statement because some items of income or expense are taxable or deductible in different years or may never be taxable or deductible. The Group’s liability for current tax is calculated using tax rates and laws that have been enacted or substantively enacted by the reporting period date.
The Group recognises provisions for uncertain tax positions when the Group has a present obligation as a result of a past event and management judge that it is probable that there will be a future outflow of economic benefits from the Group to settle the obligation. Uncertain tax positions are assessed and measured on an issue by issue basis within the jurisdictions that we operate either using management’s estimate of the most likely outcome where the issues are binary, or the expected value approach where the issues have a range of possible outcomes. The Group recognises interest on late paid taxes as part of financing costs, and any penalties, if applicable, as part of the income tax expense.
Deferred tax is the tax expected to be payable or recoverable in the future arising from temporary differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. It is accounted for using the statement of financial position liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that temporary differences or taxable profits will be available against which deductible temporary differences can be utilised.
Such assets and liabilities are not recognised if the temporary difference arises from the initial recognition (other than in a business combination) of assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit. Deferred tax liabilities are not recognised to the extent they arise from the initial recognition of non-tax deductible goodwill.
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries and associates, and interests in joint arrangements, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each reporting period date and adjusted to reflect changes in the Group’s assessment that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset realised, based on tax rates that have been enacted or substantively enacted by the reporting period date.
Tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they either relate to income taxes levied by the same taxation authority on either the same taxable entity or on different taxable entities which intend to settle the current tax assets and liabilities on a net basis.
Notes to the consolidated financial statements (continued) | |||
Tax is charged or credited to the income statement, except when it relates to items charged or credited to other comprehensive income or directly to equity, in which case the tax is recognised in other comprehensive income or in equity.
2022 | 2021 | 2020 | ||||
Income tax expense | €m | €m | €m | |||
United Kingdom corporation tax expense/(credit): |
|
|
|
|
|
|
Current year |
| |
| |
| |
Adjustments in respect of prior years |
| |
| |
| ( |
| |
| |
| | |
Overseas current tax expense/(credit): |
|
|
| |||
Current year |
| |
| |
| |
Adjustments in respect of prior years |
| |
| ( |
| |
| |
| |
| | |
Total current tax expense |
| |
| |
| |
Deferred tax on origination and reversal of temporary differences: |
|
|
| |||
United Kingdom deferred tax |
| ( |
| ( |
| ( |
Overseas deferred tax |
| |
| |
| |
Total deferred tax expense |
| |
| |
| |
Total income tax expense |
| |
| |
| |
UK operating profits are more than offset by statutory allowances for capital investment in the UK network and systems plus ongoing interest costs including those arising from the €
Tax charged/(credited) directly to other comprehensive income
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Current tax |
| – |
| ( |
| ( |
Deferred tax |
| |
| ( |
| |
Total tax charged/(credited) directly to other comprehensive income |
| |
| ( |
| |
Tax credited directly to equity
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Deferred tax |
| – |
| ( |
| – |
Total tax credited directly to equity |
| – |
| ( |
| – |
Notes to the consolidated financial statements (continued) | |
Factors affecting the tax expense for the year
The table below explains the differences between the expected tax expense, being the aggregate of the Group’s geographical split of profits multiplied by the relevant local tax rates and the Group’s total tax expense for each year.
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
(restated)* | ||||||
Continuing profit before tax as shown in the consolidated income statement |
| |
| |
| |
Aggregated expected income tax expense |
| |
| |
| |
Impairment losses with no tax effect |
| – |
| – |
| |
Disposal of Group investments(1) |
| ( |
| ( |
| ( |
Effect of taxation of associates and joint ventures, reported within profit before tax |
| ( |
| |
| |
Deferred tax charge/(credit) following revaluation of investments in Luxembourg |
| |
| | * | ( |
Previously unrecognised temporary differences we expect to use in the future, including in Luxembourg |
| ( |
| ( |
| ( |
Previously recognised temporary differences and losses we no longer expect to use in the future |
| |
| | * | – |
Current year temporary differences (including losses) that we currently do not expect to use |
| |
| |
| |
Adjustments in respect of prior year tax liabilities |
| |
| ( |
| ( |
Impact of tax credits and irrecoverable taxes |
| |
| |
| |
Deferred tax on overseas earnings |
| |
| – |
| |
Effect of current year changes in statutory tax rates on deferred tax balances (2) |
| ( |
| ( |
| |
Financing costs not deductible/(taxable) for tax purposes | | ( | | |||
Revaluation of assets for tax purposes in Italy and Turkey | ( | – | – | |||
Expenses not deductible for tax purposes |
| |
| |
| |
Income tax expense |
| |
| |
| |
Notes:
* | During the year ended 31 March 2022, we revised the calculation of certain impairment reversals recognised by our Luxembourg holding companies for the year ended 31 March 2021; this had no impact on the amount of deferred tax assets recognised at that date but has changed the amount of our unrecognised deferred tax assets by € |
1 | 2021 includes the tax exempt gains relating to the TPG Telecom Limited merger in Australia and Indus Towers Limited in India. 2020 relates to tax exempt disposal gains on Vodafone New Zealand, Vodafone Malta and the merger of the Italian towers with INWIT. |
2 | 2022 includes the increase in future UK tax rate to |
Deferred tax
Analysis of movements in the net deferred tax asset balance during the year:
| €m | |
1 April 2021 |
| |
Foreign exchange movements |
| ( |
Charged to the income statement |
| ( |
Charged directly to OCI |
| ( |
Charged directly to equity |
| – |
Arising on acquisitions and disposals |
| ( |
31 March 20221 |
| |
Notes to the consolidated financial statements (continued) | |||
Deferred tax assets and liabilities, before offset of balances within countries, are as follows:
| Amount |
|
|
|
|
|
|
| Net | |
credited/ | recognised | |||||||||
(expensed) | Gross | Gross | Less | deferred tax | ||||||
in income | deferred | deferred tax | amounts | (liability)/ | ||||||
statement | tax asset | liability | unrecognised | asset | ||||||
€m | €m | €m | €m | €m | ||||||
Accelerated tax depreciation |
| |
| |
| ( |
| ( |
| |
Intangible assets |
| |
| |
| ( |
| |
| ( |
Tax losses |
| ( |
| |
| – |
| ( |
| |
Treasury related items |
| ( |
| |
| ( |
| ( |
| ( |
Temporary differences relating to revenue recognition | ( | | ( | – | ( | |||||
Temporary differences relating to leases |
| ( |
| |
| ( |
| – |
| |
Other temporary differences | | | ( | ( | | |||||
31 March 20221 |
| ( |
| |
| ( |
| ( |
| |
Analysed in the balance sheet, after offset of balances within countries, as:
| €m | |
Deferred tax asset |
| |
Deferred tax liability |
| ( |
31 March 20221 |
| |
At 31 March 2021, deferred tax assets and liabilities, before offset of balances within countries, were as follows:
| Amount |
|
|
|
|
|
|
| Net | |
credited/ | recognised | |||||||||
(expensed) | Gross | Gross | Less | deferred tax | ||||||
in income | deferred | deferred tax | amounts | (liability)/ | ||||||
statement | tax asset* | liability* | unrecognised* | asset | ||||||
€m | €m | €m | €m | €m | ||||||
Accelerated tax depreciation |
| |
| |
| ( |
| ( |
| |
Intangible assets |
| |
| |
| ( |
| |
| ( |
Tax losses |
| ( |
| |
| – |
| ( |
| |
Treasury related items |
| ( |
| |
| ( |
| ( |
| |
Temporary differences relating to revenue recognition | ( | | ( | – | ( | |||||
Temporary differences relating to leases |
| ( |
| |
| ( |
| – |
| |
Other temporary differences | ( | | ( | ( | | |||||
31 March 20211 |
| ( |
| |
| ( |
| ( |
| |
At 31 March 2021, analysed in the balance sheet, after offset of balances within countries, as:
| €m | |
Deferred tax asset |
| |
Deferred tax liability |
| ( |
31 March 20211 |
| |
Note:
| 1 | The Group does not discount deferred tax assets. This is in accordance with IAS 12. |
Factors affecting the tax charge in future years
The Group’s future tax charge, and effective tax rate, could be affected by several factors including; tax reform in countries around the world, including any arising from the OECD’s or European Commission’s work on the taxation of the digital economy and European Commission initiatives such as the proposed tax and financial reporting directive or as a consequence of state aid investigations, future corporate acquisitions and disposals, any restructuring of our businesses and the resolution of open tax issues (see below).
On 25 April 2019, the European Commission published its full decision in relation to its investigation into the ‘group financing exemption’ (GFE) in the UK’s controlled foreign company rules and whether the GFE constituted unlawful State Aid. It concluded the GFE does not constitute unlawful state aid when the managing of the financing activities is outside the UK. We consider that the Group’s Luxembourg financing activities are properly established and operate in accordance with EU and local law as well
Notes to the consolidated financial statements (continued) | |
as the OECD’s transfer pricing guidelines and on 27 May 2021 the UK tax authorities confirmed it reached the view Vodafone was not in receipt of any state aid relating to the GFE. The European Commission has indicated it agrees with this conclusion
The Group is routinely subject to audit by tax authorities in the territories in which it operates. The Group considers each issue on its merits and, where appropriate, holds provisions in respect of the potential tax liability that may arise. As at 31 March 2022, the Group holds provisions for such potential liabilities of €
As the tax impact of a transaction can be uncertain until a conclusion is reached with the relevant tax authority or through a legal process, the amount ultimately paid may differ materially from the amount accrued and could therefore affect the Group's overall profitability and cash flows in future periods. See Note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements.
At 31 March 2022, the gross amount and expiry dates of losses available for carry forward are as follows:
| Expiring |
| Expiring |
|
|
|
| |
within | beyond | |||||||
5 years | 6 years | Unlimited | Total | |||||
€m | €m | €m | €m | |||||
Losses for which a deferred tax asset is recognised |
| | | | | |||
Losses for which no deferred tax is recognised |
| | | | | |||
| | | | |
At 31 March 2021, the gross amount and expiry dates of losses available for carry forward were as follows:
| Expiring |
| Expiring |
|
|
|
| |
within | beyond | |||||||
5 years | 6 years | Unlimited* | Total | |||||
€m | €m | €m | €m | |||||
Losses for which a deferred tax asset is recognised |
| | | | | |||
Losses for which no deferred tax is recognised |
| | | | | |||
| | | | |
Deferred tax assets on losses in Luxembourg
Included in the table above are losses of €
The Luxembourg companies hold investments in the Group’s operating companies which are assessed for impairment for local GAAP financial statements using the Group’s recoverable value calculations (see Note 4 ‘Impairment losses’). The recognition or reversal of impairments is recorded in the local GAAP financial statements and therefore the carrying values and valuation methodology differs from the goodwill assessment for the Group’s consolidated financial statements. This assessment can give rise to tax deductible impairments or taxable reversals of previous impairments.
Following the 2017 tax reform in Luxembourg, tax losses expire after 17 years and are only used after any pre-existing losses. In the year ended 31 March 2020 the Luxembourg companies had tax deductible impairments resulting in additional tax losses.
The reversal of impairments can result in a significant reduction to our deferred tax assets and the period over which these assets can be utilised. In the year ended 31 March 2022 a reversal of previous impairments of €
The Luxembourg companies’ recurring profits are derived from the Group’s internal financing, centralised procurement, and international roaming activities. These activities have consistently generated taxable profits of over €
Notes to the consolidated financial statements (continued) | |||
generated from the procurement and roaming activities. The valuations take into account all information at the balance sheet date and the Group does not forecast potential future impairments or reversals of impairments.
This assessment also included a review of the commercial structures supporting the profits generated from these activities and considered the factors, under the Group’s control, which could impact the ability of these activities to generate taxable profits. We have assessed that the current structure continues to be sustainable under the tax laws substantively enacted at the balance sheet date and the Group’s intentions to keep these activities in Luxembourg remains unchanged.
Based on the current forecasts, €
An increase or decrease in the forecast income in Luxembourg in each year of
Any future changes in tax law, including those driven by OECD, EU or domestic tax reforms or the structure of the Group could have a significant effect on the use of the Luxembourg losses, including the period over which these losses can be utilised. The Group has reviewed the OECD model rules and supporting commentary and does not anticipate a significant impact on its ability to continue to use our losses in Luxembourg. On the basis that future changes in tax laws are unknown, the profit forecasts assume that existing tax laws continue.
Based on the above factors the Group concludes that it is probable that the Luxembourg companies will continue to generate taxable profits in the future against which it will use these losses. In addition to the above, €
Deferred tax assets on losses in Germany
The Group has tax losses of €
Deferred tax assets on losses in Spain
The Group has tax losses of €
Deferred tax assets in Italy
The Group has a recognised deferred tax asset of €
Other tax losses
The Group has losses amounting to €
Notes to the consolidated financial statements (continued) | |
been recognised, as in the prior year. The remaining losses relate to a number of other jurisdictions across the Group. There are also €
Impact of climate risks
The recovery of the Group’s deferred tax assets is dependent on its forecasts of future profitability and the climate related risks identified on page 148 have been considered in the Group’s assessment of the recovery of those assets. The Group does not expect the climate related risks to have an impact on the ability of Luxembourg to continue to provide the internal financing, procurement, and roaming activities to other members of the Group.
Unremitted earnings
No deferred tax liability has been recognised in respect of a further €
7. Discontinued operations and assets held for sale
The Group classifies certain of its assets that it expects to dispose as either discontinued operations or as held for sale.
The Group classifies non-current assets and assets and liabilities within disposal groups (‘assets’) as held for sale if the assets are available immediately for sale in their present condition, management is committed to a plan to sell the assets under usual terms, it is highly probable that their carrying amounts will be recovered principally through a sale transaction rather than through continuing use and the sale is expected to be completed within one year from the date of the initial classification.
Assets and liabilities classified as held for sale are presented separately as current items in the consolidated statement of financial position and are measured at the lower of their carrying amount and fair value less costs to sell. Property, plant and equipment and intangible assets are not depreciated or amortised once classified as held for sale; this also applies in respect of assets held by equity accounted associates and joint ventures.
Where operations constitute a separately reportable segment (see note 2 ‘Revenue disaggregation and segmental analysis’) and have been disposed of, or are classified as held for sale, the Group classifies such operations as discontinued.
Discontinued operations are excluded from the results of continuing operations and are presented as a single amount as profit or loss after tax from discontinued operations in the Group consolidated income statement. Discontinued operations are also excluded from segment reporting. All other notes to the financial statements include amounts for continuing operations, unless indicated otherwise.
Discontinued operations
The Group did not have any discontinued operations in the year ended 31 March 2022 or the comparative years ended 31 March 2021 and 31 March 2020.
Assets held for sale
Assets held for sale at 31 March 2022 comprise the Group’s
The relevant assets are detailed in the table below.
2022 | 2021 | |||
| €m |
| €m | |
Non-current assets |
|
|
|
|
Investments in associates and joint ventures | | | ||
Assets held for sale |
| |
| |
Notes to the consolidated financial statements (continued) | |||
8. Earnings per share
Basic earnings per share is the amount of profit generated for the financial year attributable to equity shareholders divided by the weighted average number of shares in issue during the year.
| 2022 |
| 2021 |
| 2020 | |
Weighted average number of shares for basic earnings per share |
| |
| |
| |
Effect of dilutive potential shares: restricted shares and share options |
| | |
| – | |
Weighted average number of shares for diluted earnings per share |
| |
| |
| |
2022 | 2021 | 2020 |
| ||||||
€m | €m | €m |
| ||||||
Profit/(loss) for earnings per share from continuing operations |
| |
| |
| ( |
| ||
Profit/(loss) for basic and diluted earnings per share |
| |
| |
| ( |
| ||
| eurocents |
| eurocents |
| eurocents |
| |||
Basic earnings/(loss) per share from continuing operations |
| | c | | c | ( | c | ||
Basic earnings/(loss) per share | | c | | c | ( | c | |||
eurocents | eurocents | eurocents | |||||||
Diluted earnings/(loss) per share from continuing operations | | c | | c | ( | c | |||
Diluted earnings/(loss) per share | | c | | c | ( | c |
9. Equity dividends
Dividends are one type of shareholder return, historically paid to our shareholders in February and August.
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Declared during the financial year |
|
|
|
|
|
|
Final dividend for the year ended 31 March 2021: |
| |
| |
| |
Interim dividend for the year ended 31 March 2022: | | | | |||
| | | ||||
Proposed after the end of the year and not recognised as a liability | ||||||
Final dividend for the year ended 31 March 2022: | | | |
10. Intangible assets
The statement of financial position contains significant intangible assets, mainly in relation to goodwill and licences and spectrum. Goodwill, which arises when we acquire a business and pay a higher amount than the fair value of its net assets primarily due to the synergies we expect to create, is not amortised but is subject to annual impairment reviews. Licences and spectrum are amortised over the life of the licence. For further details see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation ‘ to the consolidated financial statements.
Accounting policies
Identifiable intangible assets are recognised when the Group controls the asset, it is probable that future economic benefits attributed to the asset will flow to the Group and the cost of the asset can be reliably measured. Identifiable intangible assets are
Notes to the consolidated financial statements (continued) | |
recognised at fair value when the Group completes a business combination. The determination of the fair values of the separately identified intangibles, is based, to a considerable extent, on management’s judgement.
Goodwill
Goodwill arising on the acquisition of an entity represents the excess of the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities and contingent liabilities of the entity recognised at the date of acquisition.
Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Goodwill is not subject to amortisation but is tested for impairment annually or whenever there is evidence that it may be impaired. Goodwill is denominated in the currency of the acquired entity and revalued to the closing exchange rate at each reporting period date.
Negative goodwill arising on an acquisition is recognised directly in the income statement.
On disposal of a subsidiary or a joint arrangement, the attributable amount of goodwill is included in the determination of the profit or loss recognised in the income statement on disposal.
Finite lived intangible assets
Intangible assets with finite lives are stated at acquisition or development cost, less accumulated amortisation. The amortisation period and method is reviewed at least annually. Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodied in the asset are accounted for by changing the amortisation period or method, as appropriate, and are treated as changes in accounting estimates.
Licence and spectrum fees
Amortisation periods for licence and spectrum fees are determined primarily by reference to the unexpired licence period, the conditions for licence renewal and whether licences are dependent on specific technologies. Amortisation is charged to the income statement on a straight-line basis over the estimated useful lives from the commencement of related network services.
Computer software
Computer software comprises software purchased from third parties as well as the cost of internally developed software. Computer software licences are capitalised on the basis of the costs incurred to acquire and bring into use the specific software. Costs that are directly associated with the production of identifiable and unique software products controlled by the Group, and are probable of producing future economic benefits, are recognised as intangible assets. Direct costs of software development include employee costs and directly attributable overheads.
Software integral to an item of hardware equipment is classified as property, plant and equipment.
Costs associated with maintaining software programs are recognised as an expense when they are incurred.
Amortisation is charged to the income statement on a straight-line basis over the estimated useful life from the date the software is available for use.
Other intangible assets
Other intangible assets, including brands and customer bases, are recorded at fair value at the date of acquisition. Amortisation is charged to the income statement, over the estimated useful lives of intangible assets from the date they are available for use, on a straight-line basis. The amortisation basis adopted for each class of intangible asset reflects the Group’s consumption of the economic benefit from that asset.
Estimated useful lives
The estimated useful lives of finite lived intangible assets are as follows:
– Licence and spectrum fees |
| |
– Computer software | ||
– Brands | ||
– Customer bases |
Notes to the consolidated financial statements (continued) | |||
|
| Licence and |
| Computer |
| Customer |
|
| ||||
Goodwill | spectrum fees1 | software | bases | Other | Total | |||||||
€m | €m | €m | €m | €m | €m | |||||||
Cost |
|
|
|
|
|
|
|
|
|
| ||
1 April 2020 |
| |
| |
| | |
| |
| | |
Exchange movements |
| |
| |
| | | |
| | ||
Arising on acquisition |
| |
| – |
| – | |
| – |
| | |
Additions |
| – |
|
| | |
| |
| | ||
Disposals |
| – |
| ( |
| ( | ( |
| ( |
| ( | |
Other |
| – |
| – |
| | – |
| ( |
| | |
31 March 2021 |
| |
| |
| | |
| |
| | |
Exchange movements | ( | ( | ( | | | ( | ||||||
Arising on acquisition | ( | – | – | | – | | ||||||
Additions | – | | | – | | | ||||||
Disposals | – | ( | ( | – | ( | ( | ||||||
Other | – | | | – | ( | | ||||||
31 March 2022 | | | | | | | ||||||
Accumulated impairment losses and amortisation |
|
|
|
|
|
|
|
|
| |||
1 April 2020 |
| |
| |
| | |
| |
| | |
Exchange movements |
| ( |
| |
| | |
| |
| | |
Amortisation charge for the year | – | | | | | | ||||||
Disposals |
| – |
| ( |
| ( | – |
| ( |
| ( | |
Other |
| – |
| – |
| | – |
| ( |
| | |
31 March 2021 |
| |
| |
| | |
| |
| | |
Exchange movements | ( | ( | ( | | | ( | ||||||
Amortisation charge for the year | – | | | | | | ||||||
Disposals | – | ( | ( | – | ( | ( | ||||||
Other | – | – | | – | ( | | ||||||
31 March 2022 | | | | | | | ||||||
Net book value |
|
|
|
|
|
|
|
|
|
| ||
31 March 2021 |
| |
| |
| | |
| |
| | |
31 March 2022 | | | | | | |
Note:
1 | Includes € |
For licences and spectrum fees and other intangible assets, amortisation is included within the cost of sales line within the consolidated income statement. Included in the net book value of computer software are assets in the course of construction, which are not depreciated, with a cost of €
The net book value and expiry dates of the most significant licences are as follows:
|
| 2022 |
| 2021 | ||
Expiry dates | €m | €m | ||||
Germany |
| 2025/2033/2040 |
| |
| |
Italy |
| 2029/2037 |
| |
| |
UK |
| 2023/2033/2038/2041 |
| |
| |
Spain | 2028/2030/2031/2038/2041 | | |
The remaining amortisation period for each of the licences in the table above corresponds to the expiry date of the respective licence. A summary of the Group’s most significant spectrum licences can be found on page 247.
Notes to the consolidated financial statements (continued) | |
11. Property, plant and equipment
The Group makes significant investments in network equipment and infrastructure – the base stations and technology required to operate our networks – that form the majority of our tangible assets. All assets are depreciated over their useful economic lives. For further details on the estimation of useful economic lives, see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation ‘to the consolidated financial statements.
Accounting policies
Land and buildings held for use are stated in the statement of financial position at their cost, less any accumulated depreciation and any accumulated impairment losses.
Amounts for equipment, fixtures and fittings, which includes network infrastructure assets are stated at cost less accumulated depreciation and any accumulated impairment losses.
Assets in the course of construction are carried at cost, less any recognised impairment losses. Depreciation of these assets commences when the assets are ready for their intended use.
The cost of property, plant and equipment includes directly attributable incremental costs incurred in their acquisition and installation. Depreciation is charged so as to write off the cost of assets, other than land, using the straight-line method, over their estimated useful lives, as follows:
Land and buildings
– Freehold buildings |
| |
– Leasehold premises | the term of the lease |
Equipment, fixtures and fittings
– Network infrastructure and other |
|
Depreciation is not provided on freehold land.
Right-of-use assets arising from the Group's lease arrangements are depreciated over their reasonably certain lease term, as determined under the Group's leases policy (see note 20 ‘Leases’ and ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 for details).
Notes to the consolidated financial statements (continued) | |||
The gain or loss arising on the disposal, retirement or granting of a finance lease on an item of property, plant and equipment is determined as the difference between any proceeds from sale or receivables arising on a lease and the carrying amount of the asset and is recognised in the income statement.
|
| Equipment, |
| |||
Land and | fixtures | |||||
buildings | and fittings | Total | ||||
€m | €m | €m | ||||
Cost |
|
|
|
|
|
|
1 April 2020 |
| |
| |
| |
Exchange movements |
| |
| |
| |
Arising on acquisition |
| |
| |
| |
Additions |
| |
| |
| |
Disposals |
| ( | ( |
| ( | |
Other |
| |
| |
| |
31 March 2021 |
| |
| |
| |
Exchange movements | | ( | ( | |||
Arising on acquisition | ( | | ( | |||
Additions | | | | |||
Disposals | ( | ( | ( | |||
Other | | | | |||
31 March 2022 | | | | |||
Accumulated depreciation and impairment |
|
|
|
|
|
|
1 April 2020 |
| |
| |
| |
Exchange movements |
| |
| |
| |
Charge for the year |
| |
| |
| |
Disposals |
| ( |
| ( |
| ( |
Other |
| ( |
| |
| |
31 March 2021 |
| |
| |
| |
Exchange movements | | ( | ( | |||
Charge for the year | | | | |||
Disposals | ( | ( | ( | |||
Other | | ( | | |||
31 March 2022 | | | | |||
Net book value |
|
|
|
|
|
|
31 March 2021 |
| |
| |
| |
31 March 2022 | | | |
Included in the net book value of land and buildings and equipment, fixtures and fittings are assets in the course of construction, which are not depreciated, with a cost of €
Right-of-use assets arising from the Group’s lease arrangements are recorded within property, plant and equipment:
| 2022 |
| 2021 | |
| €m | €m | ||
Property, plant and equipment (owned assets) |
| |
| |
Right-of-use assets1 |
| |
| |
31 March |
| |
| |
Note:
1 | Additions of € |
Notes to the consolidated financial statements (continued) | |
12. Investments in associates and joint arrangements
The Group holds interests in associates in Kenya and in India, where we have significant influence, as well as in a number of joint arrangements in the UK, Italy, the Netherlands, India and Australia, where we share control with one or more third parties. For further details see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation ‘to the consolidated financial statements.
Accounting policies
Interests in joint arrangements
A joint arrangement is a contractual arrangement whereby the Group and other parties undertake an economic activity that is subject to joint control; that is, when the relevant activities that significantly affect the investee’s returns require the unanimous consent of the parties sharing control. Joint arrangements are either joint operations or joint ventures.
Gains or losses resulting from the contribution or sale of a subsidiary as part of the formation of a joint arrangement are recognised in respect of the Group’s entire equity holding in the subsidiary.
Joint operations
A joint operation is a joint arrangement whereby the parties that have joint control have the rights to the assets, and obligations for the liabilities, relating to the arrangement or that other facts and circumstances indicate that this is the case. The Group’s share of assets, liabilities, revenue, expenses and cash flows are combined with the equivalent items in the financial statements on a line-by-line basis.
Any goodwill arising on the acquisition of the Group’s interest in a joint operation is accounted for in accordance with the Group’s accounting policy for goodwill arising on the acquisition of a subsidiary.
Joint ventures
A joint venture is a joint arrangement whereby the parties that have joint control have the rights to the net assets of the arrangement.
At the date of acquisition, any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the joint venture is recognised as goodwill. The goodwill is included within the carrying amount of the investment.
The results and assets and liabilities of joint ventures, other than those joint ventures or part thereof that are held for sale (see note 7 ‘Discontinued operations and assets and liabilities held for sale’), are incorporated in the consolidated financial statements using the equity method of accounting. Under the equity method, investments in joint ventures are carried in the consolidated statement of financial position at cost adjusted for post-acquisition changes in the Group’s share of the net assets of the joint venture, less any impairment in the value of the investment. The Group’s share of post-tax profits or losses are recognised in the consolidated income statement. Losses of a joint venture in excess of the Group’s interest in that joint venture are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the joint venture.
Associates
An associate is an entity over which the Group has significant influence and that is neither a subsidiary nor an interest in a joint arrangement.
Significant influence is the power to participate in the financial and operating policy decisions of the investee but where the Group does not have control or joint control over those policies.
At the date of acquisition, any excess of the cost of acquisition over the Group’s share of the net fair value of the identifiable assets, liabilities and contingent liabilities of the associate is recognised as goodwill. The goodwill is included within the carrying amount of the investment.
The results and assets and liabilities of associates are incorporated in the consolidated financial statements using the same equity method of accounting used for joint ventures, described above.
Notes to the consolidated financial statements (continued) | |||
Joint operations
The Company’s principal joint operation has share capital consisting solely of ordinary shares and is indirectly held, and principally operates in the UK. The financial and operating activities of the operation are jointly controlled by the participating shareholders and are primarily designed for all but an insignificant amount of the output to be consumed by the shareholders.
|
| Country of | Percentage |
| Percentage | |||
incorporation or | shareholding1 | shareholding1 | ||||||
Name of joint operation | Principal activity | registration | 2022 | 2021 | ||||
Cornerstone Telecommunications Infrastructure Limited |
| Network infrastructure |
| UK | |
| |
Note:
| 1 | Effective ownership percentages of Vodafone Group Plc rounded to the nearest tenth of one percent. |
Joint ventures and associates
2022 | 2021 | |||
€m | €m | |||
Investments in joint ventures |
| |
| |
Investments in associates |
| |
| |
31 March |
| |
| |
Joint ventures
The financial and operating activities of the Group’s joint ventures are jointly controlled by the participating shareholders. The participating shareholders have rights to the net assets of the joint ventures through their equity shareholdings. Unless otherwise stated, the Company’s principal joint ventures all have share capital consisting solely of ordinary shares and are all indirectly held. The country of incorporation or registration of all joint ventures is also their principal place of operation.
|
| Country of |
| Percentage |
| Percentage | ||
incorporation or | shareholdings1 | shareholdings1 | ||||||
Name of joint venture | Principal activity | registration | 2022 | 2021 | ||||
Infrastructture Wireless Italiane (INWIT) S.p.A.2 | Network infrastructure | Italy | | |||||
VodafoneZiggo Group Holding B.V. |
| Network operator |
| Netherlands |
| | ||
TPG Telecom Limited3 | Network operator | Australia | | | ||||
Vodafone Idea Limited4 | Network operator | India | | |
Notes:
| 1 | Effective ownership percentages of Vodafone Group Plc rounded to the nearest tenth of one percent. |
| 2 | At 31 March 2022 the fair value of the Group’s interest in INWIT S.p.A. was € |
| 3 | At 31 March 2022 the fair value of the Group’s interest in TPG Telecom Limited was AUD |
| 4 | At 31 March 2022 the fair value of the Group’s interest in Vodafone Idea Limited was INR |
Vodafone Idea Limited
The Group’s carrying value in Vodafone Idea Limited (‘VIL’) reduced to €
The value of the Group’s
TPG Telecom Limited
TPG Telecom Limited is listed on the Australian Securities Exchange (‘ASX’). Vodafone and Hutchison Telecommunications (Australia) Limited each own an economic interest of
The following table provides aggregated financial information for the Group’s joint ventures as it relates to the amounts recognised in the income statement, statement of comprehensive income and statement of financial position.
Notes to the consolidated financial statements (continued) | |
INWIT S.p.A.
Financial information presented for INWIT S.p.A. for the years to 31 March 2022 and 31 March 2021 is based on INWIT S.p.A’s financial results and financial position as at 31 December 2021 and 31 December 2020, respectively, being the latest financial information available to the Group on completing the financial statements for each year.
Profit/(loss) from | ||||||||||
Investment in joint ventures | continuing operations2 | |||||||||
2022 | 2021 | 2022 | 2021 | 2020 | ||||||
€m | €m | €m | €m | €m | ||||||
INWIT S.p.A. |
| |
| |
| |
| |
| – |
VodafoneZiggo Group Holding B.V. | | | ( | ( | ( | |||||
TPG Telecom Limited1 | | | ( | | ( | |||||
Indus Towers Limited |
| – |
| – |
| – |
| – |
| |
Vodafone Idea Limited |
| – |
| – |
| – |
| – |
| ( |
Other |
| |
| |
| ( |
| ( |
| ( |
Total |
| |
| |
| ( |
| ( |
| ( |
Notes:
1 | Amounts presented reflect Vodafone Hutchison Australia Pty Limited results only until the date of the merger with TPG Telecom Limited on 26 June 2020, subsequent of which the combined results are presented. |
2 | Total Other comprehensive (expense)/income is not materially different to profit/(loss) from continuing operations. |
Summarised financial information
Summarised financial information for each of the Group’s material joint ventures on a 100% ownership basis is set out below.
Financial information presented for the year to, and as at 31 March 2021, has been updated to reflect the release of full year financial information by VIL. As disclosed above, the Group’s investment in VIL was reduced to €
| INWIT S.p.A. |
| VodafoneZiggo Group Holding B.V. | |||||||||
2022 | 2021 | 2020 | 2022 | 2021 | 2020 | |||||||
€m | €m | €m | €m | €m | €m | |||||||
Income statement | ||||||||||||
Revenue |
| | | – |
| |
| |
| | ||
Operating expenses | ( | ( | – | ( | ( | ( | ||||||
Depreciation and amortisation |
| ( | ( | – |
| ( |
| ( |
| ( | ||
Other income | – | – | – | – | | – | ||||||
Operating profit | | | – | | | | ||||||
Interest income |
| – | – | – |
| – |
| – |
| – | ||
Interest expense |
| ( | ( | – |
| ( |
| ( |
| ( | ||
Profit/(loss) before tax | | | – | | ( | ( | ||||||
Income tax expense |
| ( | ( | – |
| ( |
| ( |
| ( | ||
Profit/(loss) from continuing operations1 |
| | | – |
| ( |
| ( |
| ( | ||
TPG Telecom Limited | Vodafone Idea Limited | |||||||||||
| 2022 | 2021 | 2020 |
| 2022 |
| 2021 |
| 2020 | |||
€m | €m | €m | €m | €m | €m | |||||||
Income statement |
|
|
|
|
|
|
|
| ||||
Revenue |
| | | |
| |
| |
| | ||
Operating expenses |
| ( | ( | ( |
| ( |
| ( |
| ( | ||
Depreciation and amortisation |
| ( | ( | ( |
| ( |
| ( |
| ( | ||
Other income |
| – | – | – |
| ( |
| ( |
| ( | ||
Operating profit/(loss) |
| | | |
| ( |
| ( |
| ( | ||
Interest income |
| – | | |
| |
| |
| | ||
Interest expense |
| ( | ( | ( |
| ( |
| ( |
| ( | ||
Profit/(loss) before tax |
| | ( | ( |
| ( |
| ( |
| ( | ||
Income tax (expense)/credit | ( | | – | | – | – | ||||||
Profit/(loss) from continuing operations1 |
| | | ( |
| ( |
| ( | ( | |||
Note:
| 1 | Total Other comprehensive income/(expense) is not materially different to profit/(loss) from continuing operations. |
Notes to the consolidated financial statements (continued) | |||
| INWIT S.p.A. |
| VodafoneZiggo Group Holding B.V. | |||||
2022 | 2021 | 2022 | 2021 | |||||
€m | €m | €m | €m | |||||
Statement of financial position |
|
|
|
|
|
|
| |
Non-current assets |
| |
| |
| |
| |
Current assets |
| |
| |
| |
| |
Total assets |
| |
| |
| |
| |
Equity shareholders’ funds |
| |
| |
| |
| |
Non-current liabilities |
| |
| |
| |
| |
Current liabilities |
| |
| |
| |
| |
Cash and cash equivalents within current assets |
| |
| |
| |
| |
Non-current liabilities excluding trade and other payables and provisions |
| |
| |
| |
| |
Current liabilities excluding trade and other payables and provisions |
| |
| |
| |
| |
| TPG Telecom Limited |
| Vodafone Idea Limited1 | |||||
2022 | 2021 | 2022 | 2021 | |||||
€m | €m | €m | €m | |||||
Statement of financial position |
|
|
|
|
|
|
|
|
Non-current assets |
| |
| |
| |
| |
Current assets |
| |
| |
| |
| |
Total assets |
| |
| |
| |
| |
Equity shareholders’ funds |
| |
| |
| ( |
| ( |
Non-current liabilities |
| |
| |
| |
| |
Current liabilities |
| |
| |
| |
| |
Cash and cash equivalents within current assets |
| |
| |
| |
| |
Non-current liabilities excluding trade and other payables and provisions |
| |
| |
| |
| |
Current liabilities excluding trade and other payables and provisions |
| |
| |
| |
| |
Note:
1 | Includes certain amounts subject to an adjustment mechanism agreed as part of the formation of Vodafone Idea Limited. See note 29 ‘Contingent liabilities and legal proceedings’ for more detail. |
The Group received dividends in the year ended 31 March 2022 from VodafoneZiggo Group Holding B.V. of €
Reconciliation of summarised financial information
The reconciliation of summarised financial information presented to the carrying amount of our interest in joint ventures is set out below:
INWIT S.p.A. | VodafoneZiggo Group Holding B.V. | |||||||||||
| 2022 |
| 2021 |
| 2020 |
| 2022 |
| 2021 |
| 2020 | |
€m | €m | €m | €m | €m | €m | |||||||
Equity shareholders’ funds |
| |
| |
|
| |
| |
| ||
Interest in joint ventures1 |
| |
| |
|
| |
| |
| ||
Carrying value | | | | | ||||||||
Profit/(loss) from continuing operations | | | – | ( | ( | ( | ||||||
Share of profit/(loss)1 | | | – | ( | ( | ( | ||||||
Share of profit/(loss) |
| |
| |
| – |
| ( |
| ( |
| ( |
Notes to the consolidated financial statements (continued) | |
TPG Telecom Limited | Vodafone Idea Limited | |||||||||||
2022 | 2021 | 2020 | 2022 | 2021 | 2020 | |||||||
| €m |
| €m |
| €m |
| €m |
| €m |
| €m | |
Equity shareholders’ funds/(deficit) |
| |
| |
|
| ( |
| ( |
| ||
Interest in joint ventures1 |
| | |
| ( | ( | ||||||
Impairment |
| – | – |
| ( | ( | ||||||
Goodwill |
| | |
| – | – | ||||||
Investment proportion not recognised |
| – | – |
| | | ||||||
Carrying value |
| |
| |
|
| – |
| – |
| ||
Profit/(loss) from continuing operations |
| | | ( |
| ( | ( | ( | ||||
Share of (loss)/profit1 | ( | | ( | ( | ( | ( | ||||||
Share of loss not recognised |
| – | – | |
| | | | ||||
Share of (loss)/profit1 |
| ( | | ( |
| – | – | ( | ||||
Note:
1 | The Group’s effective ownership percentages of Vodafone Idea Limited, VodafoneZiggo Group Holding B.V., Inwit S.p.A. and TPG Telecom Limited are |
Associates
Unless otherwise stated, the Company’s principal associates all have share capital consisting solely of ordinary shares and are all indirectly held. The country of incorporation or registration of all associates is also their principal place of operation.
|
| Country of |
| Percentage |
| Percentage | ||
incorporation or | shareholding1 |
| shareholding1 | |||||
Name of associate | Principal activity | registration | 2022 |
| 2021 | |||
Indus Towers Limited2 | Network infrastructure | India | | | ||||
Safaricom PLC3 |
| Network operator |
| Kenya |
| | |
Notes:
| 1 | Effective ownership percentages of Vodafone Group Plc rounded to the nearest tenth of one percent. |
| 2 | At 31 March 2022, the fair value of the Group’s interest in Indus Towers Limited was INR |
| 3 | At 31 March 2022, the fair value of the Group’s interest in Safaricom PLC was KES |
The tables below and overleaf provide aggregated financial information for the Group’s associates as it relates to the amounts recognised in the income statement, statement of comprehensive income and consolidated statement of financial position.
Investment in associates | Profit from continuing operations1 | |||||||||
2022 | 2021 | 2022 | 2021 | 2020 | ||||||
€m | €m | €m | €m | €m | ||||||
Safaricom PLC | | | | | | |||||
Indus Towers Limited1 | – | – | – | | – | |||||
Other | | – | | ( | ( | |||||
Total |
| |
| |
| | |
| | |
Note:
1. | Indus Towers Limited was classified as held for sale at 31 March 2022 and 31 March 2021. See note 7 'Discontinued operations and assets held for sale'. |
Notes to the consolidated financial statements (continued) | |||
Safaricom PLC | Indus Towers Limited | |||||||||||
2022 | 2021 | 2020 | 2022 | 2021 | 2020 | |||||||
€m | €m | €m | €m | €m | €m | |||||||
Income statement | ||||||||||||
Revenue |
| |
| |
| |
| |
| |
| |
Operating expenses |
| ( |
| ( |
| ( |
| ( |
| ( |
| ( |
Depreciation and amortisation |
| ( |
| ( |
| ( |
| ( |
| ( |
| ( |
Other income/(expense) |
| – |
| – |
| – |
| – |
| |
| ( |
Operating profit |
| |
| |
| |
| |
| |
| |
Interest income |
| |
| |
| |
| – |
| |
| |
Interest expense |
| ( |
| ( |
| ( |
| ( |
| ( |
| ( |
Profit before tax |
| |
| |
| |
| |
| |
| |
Income tax (expense)/credit |
| ( |
| ( |
| ( |
| ( |
| ( |
| |
Profit from continuing operations and total comprehensive income | | | | | | | ||||||
Attributable to: | ||||||||||||
- Owners of the parent | | | | | | | ||||||
- Non-controlling interests |
| ( |
| – |
| – |
| – |
| – |
| – |
Statement of financial position |
|
|
|
|
|
|
|
|
|
|
|
|
Non-current assets |
| |
| |
|
|
| |
| |
|
|
Current assets |
| |
| |
|
|
| |
| |
|
|
Total assets |
| |
| |
|
|
| |
| |
|
|
Equity shareholders' funds |
| |
| |
|
|
| |
| |
|
|
Non-controlling interests | | – | – | – | ||||||||
Non-current liabilities |
| |
| |
|
|
| |
| |
|
|
Current liabilities |
| |
| |
|
|
| |
| |
|
|
Cash and cash equivalents within current assets |
| |
| |
|
|
| |
| |
|
|
Non-current liabilities excluding trade and other payables and provisions |
| |
| |
|
|
| |
| |
|
|
Current liabilities excluding trade and other payables and provisions |
| |
| |
|
|
| |
| |
|
|
The reconciliation of summarised financial information presented to the carrying amount of our interest in the associate is set out below.
Equity shareholders' funds |
| |
| |
|
|
| |
| |
|
|
Interest in associates |
| |
| |
|
|
| |
| |
|
|
Goodwill |
| |
| |
|
|
| |
| |
|
|
Transferred to assets held for sale |
| – |
| – |
|
|
| ( |
| ( |
|
|
Investment proportion not recognised |
| – |
| – |
|
|
| ( |
| |
|
|
Carrying value |
| |
| |
|
|
| – |
| – |
|
|
Profit from continuing operations |
| |
| |
| |
| |
| |
| |
Share of profit |
| |
| |
| |
| |
| |
| |
Share of profit not recognised |
| – |
| – |
| – |
| ( |
| ( |
| – |
Share of profit |
| |
| |
| |
| – |
| |
| |
During the year ended 31 March 2022, the Group received a dividend from Indus Towers Limited of €nil (2021: €
Notes to the consolidated financial statements (continued) | |
13. Other investments
The Group holds a number of other listed and unlisted investments, mainly comprising managed funds, deposits and government bonds.
Accounting policies
Other investments comprising debt and equity instruments are recognised and derecognised on a trade date where a purchase or sale of an investment is under a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially measured at fair value, including transaction costs.
Debt securities that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost using the effective interest method, less any impairment. Debt securities that do not meet the criteria for amortised cost are measured at fair value through profit and loss.
Equity securities are classified and measured at fair value through other comprehensive income, there is no subsequent reclassification of fair value gains and losses to profit or loss following derecognition of the investment.
2022 | 2021 | |||
€m | €m | |||
Included within non-current assets |
|
|
|
|
Equity securities1 |
| |
| |
Debt securities2 |
| |
| |
| |
| |
Included within current assets |
|
|
|
|
Short-term investments: |
|
|
|
|
Bonds and debt securities3 |
| |
| |
Managed investment funds1 |
| |
| |
| | |||
Collateral assets4 | | | ||
Other investments5 |
| |
| |
| |
| |
Notes:
1 | Items measured at a fair value, € |
2 | Items are measured at amortised cost and have a fair value of € |
3 | Items are measured at fair value and the valuation basis is level 1 classification. |
4 | Items are measured at amortised cost and the carrying amount approximates fair value. |
5 | Includes investments measured at a fair value of € |
Non-current debt securities within non-current assets include €
The Group invests surplus cash positions across a portfolio of short-term investments to manage liquidity and credit risk whilst achieving suitable returns. Collateral arrangements on derivative financial instruments result in cash being paid/(held), repayable when the derivatives are settled. These assets do not meet the definition of cash and cash equivalents but are included in the Group’s net debt based on their liquidity.
Bonds and debt securities includes €
Managed investment funds of €
Collateral assets of €
Other investments are excluded from net debt based on their liquidity and primarily consist of restricted debt securities including amounts held in qualifying assets by Group insurance companies to meet regulatory requirements.
Notes to the consolidated financial statements (continued) | |||
14. Trade and other receivables
Trade and other receivables mainly consist of amounts owed to us by customers and amounts that we pay to our suppliers in advance. Derivative financial instruments with a positive market value are reported within this note as are contract assets, which represent an asset for accrued revenue in respect of goods or services delivered to customers for which a trade receivable does not yet exist, and finance lease receivables recognised where the Group acts as a lessor. See note 20 ‘Leases’ for more information on the Group's leasing activities.
Accounting policies
Trade receivables represent amounts owed by customers where the right to receive payment is conditional only on the passage of time. Trade receivables that are recovered in instalments from customers over an extended period are discounted at market rates and interest revenue is accreted over the expected repayment period. Other trade receivables do not carry any interest and are stated at their nominal value. When the Group establishes a practice of selling portfolios of receivables from time to time these portfolios are recorded at fair value through other comprehensive income; all other trade receivables are recorded at amortised cost.
The carrying value of all trade receivables, contract assets and finance lease receivables recorded at amortised cost is reduced by allowances for lifetime estimated credit losses. Estimated future credit losses are first recorded on the initial recognition of a receivable and are based on the ageing of the receivable balances, historical experience and forward looking considerations. Individual balances are written off when management deems them not to be collectible.
2022 | 2021 | |||
€m | €m | |||
Included within non-current assets |
|
|
|
|
Trade receivables |
| |
| |
Trade receivables held at fair value through other comprehensive income |
| |
| |
Net investment in leases | | | ||
Contract assets | | | ||
Contract-related costs | | | ||
Other receivables |
| |
| |
Prepayments |
| |
| |
Derivative financial instruments1 |
| |
| |
| |
| | |
Included within current assets |
|
| ||
Trade receivables | | | ||
Trade receivables held at fair value through other comprehensive income |
| |
| |
Net investment in leases | | | ||
Contract assets |
| |
| |
Contract-related costs |
| |
| |
Amounts owed by associates and joint ventures | | | ||
Other receivables |
| |
| |
Prepayments |
| |
| |
Derivative financial instruments1 |
| |
| |
| |
| |
Note:
1 | Items are measured at fair value and the valuation basis is level 2 classification, which comprises items where fair value is determined from inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. |
The Group’s trade receivables and contract assets are classified at amortised cost unless stated otherwise and are measured after allowances for future expected credit losses, see note 22 ‘Capital and financial risk management’ for more information on credit risk.
The carrying amounts of trade and other receivables, which are measured at amortised cost, approximate their fair value and are predominantly non-interest bearing.
Notes to the consolidated financial statements (continued) | |
The Group’s contract-related costs comprise €
The fair values of the derivative financial instruments are calculated by discounting the future cash flows to net present values using appropriate market interest rates and foreign currency rates prevailing at 31 March.
15. Trade and other payables
Trade and other payables mainly consist of amounts owed to suppliers that have been invoiced or are accrued and contract liabilities relating to consideration received from customers in advance. They also include taxes and social security amounts due in relation to the Group’s role as an employer. Derivative financial instruments with a negative market value are reported within this note.
Accounting policies
Trade payables are not interest-bearing and are stated at their nominal value.
2022 | 2021 | |||
€m | €m | |||
Included within non-current liabilities |
|
|
|
|
Other payables |
| |
| |
Accruals |
| |
| |
Contract liabilities |
| |
| |
Derivative financial instruments1 |
| |
| |
| |
| | |
Included within current liabilities | ||||
Trade payables |
| |
| |
Amounts owed to associates and joint ventures |
| |
| |
Other taxes and social security payable |
| |
| |
Other payables |
| |
| |
Accruals2 |
| |
| |
Contract liabilities |
| |
| |
Derivative financial instruments1 |
| |
| |
| |
| |
Notes:
1 | Items are measured at fair value and the valuation basis is level 2 classification, which comprises items where fair value is determined from inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly. |
2 | Includes € |
The carrying amounts of trade and other payables approximate their fair value.
Materially all of the €
Other payables included within non-current liabilities include €
The fair values of the derivative financial instruments are calculated by discounting the future cash flows to net present values using appropriate market interest rates and foreign currency rates prevailing at 31 March.
Notes to the consolidated financial statements (continued) | |||
16. Provisions
A provision is a liability recorded in the statement of financial position, where there is uncertainty over the timing or amount that will be paid, and is therefore often estimated. The main provisions we hold are in relation to asset retirement obligations, which include the cost of returning network infrastructure sites to their original condition at the end of the lease and claims for legal and regulatory matters.
Accounting policies
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle that obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the Directors’ best estimate of the expenditure required to settle the obligation at the reporting date and are discounted to present value where the effect is material. Where the timing of settlement is uncertain amounts are classified as non-current where settlement is expected more than 12 months from the reporting date.
Asset retirement obligations
In the course of the Group’s activities, a number of sites and other assets are utilised which are expected to have costs associated with decommissioning. The associated cash outflows are substantially expected to occur at the dates of decommissioning of the assets to which they relate, and are long term in nature.
Legal and regulatory
The Group is involved in a number of legal and other disputes, including where the Group has received notifications of possible claims. The Directors of the Company, after taking legal advice, have established provisions considering the facts of each case. For a discussion of certain legal issues potentially affecting the Group see note 29 ‘Contingent liabilities and legal proceedings’ to the consolidated financial statements.
Restructuring
The Group undertakes periodic reviews of its operations and recognises provisions as required based on the outcomes of these reviews. The associated cash outflows for restructuring costs are primarily less than one year.
Other
Other comprise various items that do not fall within the Group’s other categories of provisions.
| Asset |
|
|
|
| |||||
retirement | Legal and | |||||||||
obligations | regulatory | Restructuring | Other | Total | ||||||
€m | €m | €m | €m | €m | ||||||
1 April 2020 |
| |
| |
| |
| |
| |
Exchange movements |
| |
| ( |
| |
| |
| |
Acquisition of subsidiaries | | – | – | – | | |||||
Amounts capitalised in the year |
| |
| – |
| – |
| – |
| |
Amounts charged to the income statement |
| – |
| |
| |
| |
| |
Utilised in the year − payments |
| ( |
| ( |
| ( |
| ( |
| ( |
Amounts released to the income statement |
| ( |
| ( |
| ( |
| ( |
| ( |
31 March 2021 |
| |
| |
| |
| |
| |
Exchange movements | | ( | ( | | ( | |||||
Amounts capitalised in the year |
| |
| – |
| – |
| – |
| |
Amounts charged to the income statement |
| – |
| |
| |
| |
| |
Utilised in the year − payments |
| ( |
| ( |
| ( |
| ( |
| ( |
Amounts released to the income statement |
| ( |
| ( |
| ( |
| ( |
| ( |
31 March 2022 |
| |
| |
| |
| |
| |
Provisions have been analysed between current and non-current as follows:
Notes to the consolidated financial statements (continued) | |
31 March 2022
| Asset |
|
|
|
| |||||
retirement | Legal and | |||||||||
obligations | regulatory | Restructuring | Other | Total | ||||||
€m | €m | €m | €m | €m | ||||||
Current liabilities |
| |
| |
| |
| |
| |
Non-current liabilities |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
31 March 2021
| Asset |
|
|
|
| |||||
retirement | Legal and | |||||||||
obligations | regulatory | Restructuring | Other | Total | ||||||
€m | €m | €m | €m | €m | ||||||
Current liabilities |
| |
| |
| |
| |
| |
Non-current liabilities |
| |
| |
| |
| |
| |
| |
| |
| |
| |
| |
17. Called up share capital
Called up share capital is the number of shares in issue at their par value. A number of shares were allotted during the year in relation to employee share schemes.
Accounting policies
Equity instruments issued by the Group are recorded at the amount of the proceeds received, net of direct issuance costs.
2022 | 2021 | |||||||
Number | €m | Number | €m | |||||
Ordinary shares of 20 20⁄ 21 US cents each allotted, issued and fully paid:1,2,3 |
|
|
|
|
|
|
|
|
1 April |
| |
| |
| |
| |
Allotted during the year |
| |
| – |
| |
| – |
31 March |
| |
| |
| |
| |
Notes:
| 1 | At 31 March 2022 there were |
| 2 | At 31 March 2022 the Group held |
| 3 | On 5 March 2019 the Group announced the placing of subordinated mandatory convertible bonds totalling £ |
18. Reconciliation of net cash flow from operating activities
The table below shows how our profit/(loss) for the year from continuing operations translates into cash flows generated from our operating activities.
Notes to the consolidated financial statements (continued) | |||
2022 | 2021 | 2020 | ||||||
Notes | €m | €m | €m | |||||
Profit/(loss) for the financial year |
|
|
| |
| |
| ( |
Non-operating expense |
|
|
| – |
| – |
| |
Investment income |
| 5 |
| ( |
| ( |
| ( |
Financing costs |
| 5 |
| |
| |
| |
Income tax expense |
| 6 |
| |
| |
| |
Operating profit |
|
|
| |
| |
| |
Adjustments for: |
|
|
|
|
| |||
Share-based payments and other non-cash charges |
|
| |
| |
| | |
Depreciation and amortisation |
| 10, 11 |
| |
| |
| |
Loss on disposal of property, plant and equipment and intangible assets |
|
| |
| |
| | |
Share of result of equity accounted associates and joint ventures |
| 12 |
| ( |
| ( |
| |
Impairment losses |
| 4 |
| – |
| – |
| |
Other income |
| 3 |
| ( |
| ( |
| ( |
(Increase)/decrease in inventory |
|
| ( |
| ( |
| | |
(Increase)/decrease in trade and other receivables |
| 14 |
| ( |
| |
| ( |
Increase/(decrease) in trade and other payables |
| 15 |
| |
| ( |
| ( |
Cash generated by operations |
|
|
| |
| |
| |
Net tax paid |
|
|
| ( |
| ( |
| ( |
Net cash flow from operating activities |
|
|
| |
| |
| |
19. Cash and cash equivalents
The majority of the Group’s cash is held in bank deposits or money market funds which have a maturity of three months or less from acquisition to enable us to meet our short-term liquidity requirements.
Accounting policies
Cash and cash equivalents comprise cash in hand and call deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. Assets in money market funds, whose contractual cash flows do not represent solely payments of interest and principal, are measured at fair value with gains and losses arising from changes in fair value included in net profit or loss for the period. All other cash and cash equivalents are measured at amortised cost.
2022 | 2021 | |||
€m | €m | |||
Cash at bank and in hand |
| |
| |
Money market funds1 |
| |
| |
Cash and cash equivalents as presented in the statement of financial position |
| |
| |
Bank overdrafts |
| ( |
| ( |
Cash and cash equivalents as presented in the statement of cash flows |
| |
| |
Note:
| 1 | Items are measured at fair value and the valuation basis is level 1 classification, which comprises financial instruments where fair value is determined by unadjusted quoted prices in active markets. |
The carrying amount of balances at amortised cost approximates their fair value.
Cash and cash equivalents of €
20. Leases
The Group leases assets from other parties (the Group is a lessee) and also leases assets to other parties (the Group is a lessor). This note describes how the Group accounts for leases and provides details about its lease arrangements.
Notes to the consolidated financial statements (continued) | |
Accounting policies
As a lessee
When the Group leases an asset, a ‘right-of-use asset’ is recognised for the leased item and a lease liability is recognised for any lease payments to be paid over the lease term at the lease commencement date. The right-of-use asset is initially measured at cost, being the present value of the lease payments paid or payable, plus any initial direct costs incurred in entering the lease and less any lease incentives received.
Right-of-use assets are depreciated on a straight-line basis from the commencement date to the earlier of the end of the asset’s useful life or the end of the lease term. The lease term is the non-cancellable period of the lease plus any periods for which the Group is ‘reasonably certain’ to exercise any extension options (see below). The useful life of the asset is determined in a manner consistent to that for owned property, plant and equipment (as described in note 11 ‘Property, plant and equipment’). If right-of-use assets are considered to be impaired, the carrying value is reduced accordingly.
Lease liabilities are initially measured at the value of the lease payments over the lease term that are not paid at the commencement date and are usually discounted using the incremental borrowing rates of the applicable Group entity (the rate implicit in the lease is used if it is readily determinable). Lease payments included in the lease liability include both fixed payments and in-substance fixed payments during the term of the lease.
After initial recognition, the lease liability is recorded at amortised cost using the effective interest method. It is remeasured when there is a change in future lease payments arising from a change in an index or rate (e.g. an inflation related increase) or if the Group’s assessment of the lease term changes; any changes in the lease liability as a result of these changes also results in a corresponding change in the recorded right-of-use asset.
As a lessor
Where the Group is a lessor, it determines at inception whether the lease is a finance or an operating lease. When a lease transfers substantially all the risks and rewards of ownership of the underlying asset then the lease is a finance lease; otherwise the lease is an operating lease.
Where the Group is an intermediate lessor, the interests in the head lease and the sub-lease are accounted for separately and the lease classification of a sub-lease is determined by reference to the right-of-use asset arising from the head lease.
Income from operating leases is recognised on a straight-line basis over the lease term. Income from finance leases is recognised at lease commencement with interest income recognised over the lease term.
Lease income is recognised as revenue for transactions that are part of the Group’s ordinary activities (primarily leases of handsets or other equipment to customers, leases of wholesale access to the Group’s fibre and cable networks and leases of tower infrastructure assets). The Group uses IFRS 15 principles to allocate the consideration in contracts between any lease and non-lease components.
The Group’s leasing activities as a lessee
The Group leases buildings for its retail stores, offices and data centres, land on which to construct mobile base stations, space on mobile base stations to place active RAN equipment and network space (primarily rack space or duct space). In addition, the Group leases fibre and other fixed connectivity to provide internal connectivity for the Group’s operations and on a wholesale basis from other operators to provide fixed connectivity services to the Group’s customers.
The Group’s general approach to determining lease term by class of asset is described in note 1 under critical accounting judgements and key sources of estimation uncertainty.
Most of the Group’s leases include future price increases through fixed percentage increases, indexation to inflation measures on a periodic basis or rent review clauses. Other than fixed percentage increases the lease liability does not reflect the impact of these future increases unless the measurement date has passed. The Group’s leases contain no material variable payments clauses other than those related to the number of operators sharing space on third party mobile base stations.
The Group sub-leases excess retail and office properties under both operating and finance leases; see disclosure on the Group’s leasing activities as a lessor below on page 179.
Optional lease periods
Where practicable the Group seeks to include extension or break options in leases to provide operational flexibility, therefore many of the Group’s lease contracts contain optional periods. The Group’s policy on assessing and reassessing whether it is
Notes to the consolidated financial statements (continued) | |||
reasonably certain that the optional period will be included in the lease term is described in note 1 ‘Basis of preparation’ under ‘critical accounting judgements and key sources of estimation uncertainty’.
After initial recognition of a lease, the Group only reassesses the lease term when there is a significant event or a significant change in circumstances, which was not anticipated at the time of the previous assessment. Significant events or significant changes in circumstances could include merger and acquisition or similar activity, significant expenditure on the leased asset not anticipated in the previous assessment, or detailed management plans indicating a different conclusion on optional periods to the previous assessment. Where a significant event or significant change in circumstances does not occur, the lease term and therefore lease liability and right-of-use asset value, will decline over time.
The Group’s cash outflow for leases in the year ended 31 March 2022 was €
The Group’s leases for customer connectivity are normally either under regulated access or network sharing or similar preferential access arrangements and as a result the Group normally has significant flexibility over the term it can lease such connections for; generally the notice period required to cancel the lease is less than the notice period included in the service contract with the end customer. As a result, the Group does not have any significant cash exposure to optional periods on customer connectivity as the Group can cancel the lease when the service agreement ends. In some circumstances the Group is committed to minimum spend amounts for connectivity leases, which are included within reported lease liabilities.
Sale and leaseback
Sale and leaseback transactions entered into by the Group were not material, individually or in aggregate.
Amounts recognised in the primary financial statements in relation to lessee transactions
Right-of-use assets
The carrying value of the Group’s right-of-use assets, depreciation charge for the year and additions during the year are disclosed in note 11 ‘Property, plant and equipment’.
Lease liabilities
The Group’s lease liabilities are disclosed in note 21 ‘Borrowings’. The maturity profile of the Group’s lease liabilities is as follows:
2022 |
| 2021 | ||
€m | €m | |||
Within one year | |
| | |
In more than one year but less than two years | |
| | |
In more than two years but less than three years | |
| | |
In more than three years but less than four years | |
| | |
In more than four years but less than five years | |
| | |
In more than five years | |
| | |
|
| | ||
Effect of discounting | ( |
| ( | |
Lease liability - as disclosed in note 21 'Borrowings' | |
| |
At 31 March 2022 the Group has entered into lease contracts with payment obligations with an undiscounted value of €
Interest expense on lease liabilities for the year is disclosed in note 5 ‘Investment income and financing costs’.
The Group has no material liabilities under residual value guarantees and makes no material variable payments not included in the lease liability. The Group does not apply either the short term or low value expedient options in IFRS 16.
The Group's leasing activities as a lessor
The Group has a wide range of lessor activities with consumer and enterprise customers, other telecommunication companies and other companies. With consumer and enterprise customers, the Group generates lease income from the provision of
Notes to the consolidated financial statements (continued) | |
handsets, routers and other communications equipment. The Group provides wholesale access to the Group’s fibre and cable networks and leases out space on the Group’s owned mobile base stations to other telecommunication companies. In addition, the Group sub-leases retail stores to franchise partners in certain markets and leases out surplus assets (e.g. vacant offices and retail stores) to other companies.
Lessor transactions are classified as operating or finance leases based on whether the lease transfers substantially all of the risks and rewards incidental to ownership of the asset. Leases are individually assessed, but generally, the Group’s lessor transactions are classified as:
| – | Operating leases where the Group is lessor of space on owned mobile base stations, provides wholesale access to its fibre and cable networks or provides routers or similar equipment to fixed customers; and |
| – | Finance leases where the Group is sub-lessor of handsets or similar items in back-to-back arrangements or where surplus assets are sublet out for all or substantially all of the remaining head lease term. |
The Group’s income as a lessor in the year is as follows:
2022 |
| 2021 | ||
€m |
| €m | ||
Operating leases |
|
| ||
Lease revenue (note 2 'Revenue disaggregation and segmental analysis') | |
| | |
Income from leases not recognised as revenue | |
| |
The Group’s net investments in leases are disclosed in note 14 ‘Trade and other receivables’. The committed amounts to be received from the Group’s operating leases are as follows:
Maturity | ||||||||||||||
| Within one |
| In one to two |
| In two to |
| In three to four |
| In four to five |
| In more than |
|
| |
year | years | three years | years | years | five years | Total | ||||||||
€m | €m | €m | €m | €m | €m | €m | ||||||||
31 March 2022 |
|
|
|
|
|
| ||||||||
Committed operating lease payments due to the Group as a lessor | | | | | | | | |||||||
31 March 2021 | ||||||||||||||
Committed operating lease payments due to the Group as a lessor | | | | | | | | |||||||
The Group has no material lease income arising from variable lease payments.
21. Borrowings
The Group’s sources of borrowing for funding and liquidity purposes come from a range of committed bank facilities and through short-term and long-term issuances in the capital markets including bond and commercial paper issues and bank loans. Liabilities arising from the Group’s lease arrangements are also reported in borrowings; see note 20 ‘Leases’. We manage the basis on which we incur interest on debt between fixed interest rates and floating interest rates depending on market conditions using interest rate derivatives. The Group enters into foreign exchange contracts to mitigate the impact of exchange rate movements on certain monetary items.
Accounting policies
Interest-bearing loans and overdrafts are initially measured at fair value (which is equal to cost at inception), and are subsequently measured at amortised cost, using the effective interest rate method. Where they are identified as a hedged item in a designated fair value hedge relationship, fair value adjustments are recognised in accordance with our policy (see note 22 ‘Capital and financial risk management’). Any difference between the proceeds net of transaction costs and the amount due on settlement or redemption of borrowings is recognised over the term of the borrowing. Where bonds issued with certain conversion rights are identified as compound instruments they are initially measured at fair value with the nominal amounts
Notes to the consolidated financial statements (continued) | |||
recognised as a component in equity and the fair value of future coupons included in borrowings. These are subsequently measured at amortised cost using the effective interest rate method.
Borrowings
2022 | 2021 | |||
€m | €m | |||
Non-current borrowings |
| |||
Bonds | |
| | |
Bank loans |
| | | |
Lease liabilities (note 20) | |
| | |
Bank borrowings secured against Indian assets | — | | ||
Other borrowings1 | | | ||
| | |||
Current borrowings | ||||
Bonds |
| |
| |
Bank loans |
| |
| |
Lease liabilities (note 20) |
| |
| |
Collateral liabilities | | | ||
Bank borrowings secured against Indian assets | |
| | |
Other borrowings1 |
| |
| |
| | | ||
Borrowings | |
| |
Note:
1 | Includes € |
The fair value of the Group’s financial liabilities held at amortised cost approximate to fair value with the exception of long-term bonds with a carrying value of €
The Group’s borrowings also include €
The Group’s borrowings include certain bonds which have been designated in hedge relationships, which are carried at €
Commercial paper programmes
We currently have US and euro commercial paper programmes of US$
The commercial paper facilities were supported by US$
Bonds
We have a €
Vantage Towers A.G. has a €
At 31 March 2022 the Group had bonds outstanding with a nominal value equivalent to €
Notes to the consolidated financial statements (continued) | |
Bonds mature between 2022 and 2059 (2021: 2021 and 2059) and have interest rates between
Mandatory convertible bonds
On 12 March 2019 the Group issued £
Treasury shares
The Group held a maximum of
22. Capital and financial risk management
This note details the treasury management and financial risk management objectives and policies, as well as the exposure and sensitivity of the Group to credit, liquidity, interest and foreign exchange risk, and the policies in place to monitor and manage these risks.
Accounting policies
Financial instruments
Financial assets and financial liabilities, in respect of financial instruments, are recognised on the Group’s consolidated statement of financial position when the Group becomes a party to the contractual provisions of the instrument.
Financial liabilities and equity instruments
Financial liabilities and equity instruments issued by the Group are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability and an equity instrument. An equity instrument is any contract that provides a residual interest in the assets of the Group after deducting all of its liabilities and includes no obligation to deliver cash or other financial assets. The accounting policies adopted for specific financial liabilities and equity instruments are set out below.
Financial liabilities under put option arrangements
The Group has an obligation to pay a fixed rate of return to minority equity shareholders in the Group’s subsidiary Kabel Deutschland AG, under the terms of a court-imposed domination and profit and loss transfer agreement. This agreement also provides the minority shareholders the option to put their shareholding to Vodafone at a fixed price per share. The obligation to purchase the shares has been recognised as a financial liability and no non-controlling interests are recognised in respect of minority shareholders. Interest costs are accrued at the agreed rate of return and recognised in financing costs.
Derivative financial instruments and hedge accounting
The Group’s activities expose it to the financial risks of changes in foreign exchange rates and interest rates which it manages using derivative financial instruments. The use of financial derivatives is governed by the Group’s policies approved by the Board of Directors, which provide written principles on the use of financial derivatives consistent with the Group’s risk management strategy. The Group does not use derivative financial instruments for speculative purposes.
The Group designates certain derivatives as:
| – | hedges of the change in fair value of recognised assets and liabilities (‘fair value hedges’); |
| – | hedges of highly probable forecast transactions or hedges of foreign currency or interest rate risks of firm commitments (‘cash flow hedges’); or |
| – | hedges of net investments in foreign operations. |
Derivative financial instruments are initially measured at fair value on the contract date and are subsequently re-measured to fair value at each reporting date. Changes in values of all derivatives of a financing nature are included within investment income
Notes to the consolidated financial statements (continued) | |||
and financing costs in the income statement unless designated in an effective cash flow hedge relationship or a hedge of a net investment in foreign operations when the effective portion of changes in value are deferred to other comprehensive income. Hedge effectiveness is determined at the inception of the hedge relationship, and through periodic prospective effectiveness assessments to ensure that an economic relationship exists between the hedged item and hedging instrument. For fair value hedges, the carrying value of the hedged item is also adjusted for changes in fair value for the hedged risk, with gains and losses recognised in the income statement for the period.
Hedge accounting is discontinued when the hedging instrument expires or is sold, terminated, exercised or no longer qualifies for hedge accounting. When hedge accounting is discontinued, any gain or loss recognised in other comprehensive income at that time remains in equity and is recognised in the income statement when the hedged transaction is ultimately recognised in the income statement.
For cash flow hedges, when the hedged item is recognised in the income statement, amounts previously recognised in other comprehensive income and accumulated in equity for the hedging instrument are reclassified to the income statement. However, when the hedged transaction results in the recognition of a non-financial asset or a non-financial liability, the gains and losses previously recognised in other comprehensive income and accumulated in equity are transferred from equity and included in the initial measurement of the cost of the non-financial asset or non-financial liability. If a forecast transaction is no longer expected to occur, the gain or loss accumulated in equity is recognised immediately in the income statement.
For net investment hedges, gains and losses accumulated in other comprehensive income are included in the income statement when the foreign operation is disposed of.
Capital management
The following table summarises the capital of the Group at 31 March:
2022 | 2021 | |||
| €m |
| €m | |
Borrowings (note 21) |
| |
| |
Cash and cash equivalents (note 19) |
| ( |
| ( |
Derivative financial instruments included in trade and other receivables (note 14) |
| ( |
| ( |
Derivative financial instruments included in trade and other payables (note 15) |
| |
| |
Short-term investments (note 13) |
| ( |
| ( |
Collateral assets (note 13) | ( | ( | ||
Financial liabilities under put option arrangements | | | ||
Equity |
| |
| |
Capital |
| |
| |
The Group’s policy is to borrow centrally using a mixture of long-term and short-term capital market issues and borrowing facilities to meet anticipated funding requirements. These borrowings, together with cash generated from operations, are loaned internally or contributed as equity to certain subsidiaries.
Dividends from associates and to non-controlling shareholders
Dividends from our associates are generally paid at the discretion of the Board of Directors or shareholders of the individual operating and holding companies, and we have no rights to receive dividends except where specified within certain of the Group’s shareholders’ agreements. Similarly, other than ongoing dividend obligations to the Kabel Deutschland A.G. minority shareholders, should they continue to hold their minority stake, we do not have existing obligations under shareholders’ agreements to pay dividends to non-controlling interest partners of our subsidiaries or joint ventures. The amount of dividends received and paid in the year are disclosed in the consolidated statement of cash flows.
Potential cash outflows from option agreements and similar arrangements
Put options issued as part of the hedging strategy for the MCBs permit the holders to exercise against the Group at maturity of the option if there is a decrease in our share price. Under the terms of the options, settlement must be made in cash which will equate to the reduced value of shares from the initial conversion price, adjusted for dividends declared, on
Sale of trade receivables
During the year, the Group sold certain trade receivables to a number of financial institutions. Whilst there are no repurchase obligations in respect of these receivables, the Group provided credit guarantees which would only become payable if default rates were significantly higher than historical rates. The credit guarantee is not considered substantive and substantially all risks
Notes to the consolidated financial statements (continued) | |
and rewards associated with the receivables passed to the purchaser at the date of sale, therefore the receivables were derecognised. The maximum payable under the guarantees at 31 March 2022 was €
Supplier financing arrangements
The Group offers suppliers the opportunity to use supply chain financing (‘SCF’). SCF allows suppliers that decide to use it to receive funding earlier than the invoice due date. At 31 March 2022, the financial institutions that run the SCF programmes had purchased €
The Group evaluates supplier arrangements against a number of indicators to assess if the payable continues to hold the characteristics of a trade payable or should be classified as borrowings; these indicators include whether the payment terms exceed the shorter of customary payment terms in the industry or 180 days. At 31 March 2022, none of the payables subject to supplier financing arrangements met the criteria to be reclassified as borrowings.
Financial risk management
The Group’s treasury function centrally manages the Group’s funding requirement, net foreign exchange exposure, interest rate management exposures and counterparty risk arising from investments and derivatives. Treasury operations are conducted within a framework of policies and guidelines authorised and reviewed by the Board, most recently in May 2021. A treasury risk committee comprising of the Group’s Chief Financial Officer, Group General Counsel and Company Secretary, Group Financial Controller, Group Corporate Finance Director, Group Treasury Director and Group Director of Financial Controlling and Operations meets
The Group’s financial risk management policies seek to reduce the Group’s exposure to any future disruption to financial markets, including any future impacts from COVID or other macro economic events.
The Group has combined cash and cash equivalent and short-term investments of €
Notes to the consolidated financial statements (continued) | |||
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial asset leading to a financial loss for the Group. The Group is exposed to credit risk from its operating activities and from its financing activities, the Group considers its maximum exposure to credit risk at 31 March to be:
2022 | 2021 | |||
€m | €m | |||
Cash at bank and in hand (note 19) |
| |
| |
Money market funds (note 19) | | | ||
Managed investment funds (note 13) |
| |
| |
Current bonds and debt securities (note 13) |
| |
| |
Non-current debt securities (note 13) | | | ||
Collateral assets (note 13) | | | ||
Other investments (note 13) | | | ||
Derivative financial instruments (note 14) |
| |
| |
Trade receivables (note 14)1 |
| |
| |
Contract assets and other receivables (note 14) |
| |
| |
Performance bonds and other guarantees (note 29) |
| |
| |
|
| |
| |
Note:
1 | Includes amounts guaranteed under sales of trade receivables € |
Expected credit loss
The Group has financial assets classified and measured at amortised cost and fair value through other comprehensive income that are subject to the expected credit loss model requirements of IFRS 9. Cash at bank and in hand and certain other investments are both classified and measured at amortised cost and subject to impairment requirements. However, the identified expected credit loss is considered to be immaterial.
Information about expected credit losses for trade receivables and contract assets can be found under ‘operating activities’ on page 185.
Financing activities
The Group invests in government securities on the basis they generate a fixed rate of return and are amongst the most creditworthy of investments available.
Investments are made in accordance with established internal treasury policies which dictate the scaled maximum exposure permissible in relation to an investment’s long-term credit rating. The Group invests in AAA unsecured money market mutual funds, where the investment is limited to
In respect of financial instruments used by the Group’s treasury function, the aggregate credit risk the Group may have with one counterparty is limited by reference to the long-term credit ratings assigned for that counterparty by Moody’s, Fitch Ratings and Standard Poor’s. Furthermore, collateral support agreements reduce the Group’s exposure to counterparties who must post cash collateral when there is value due to the Group under outstanding derivative contracts that exceeds a contractually agreed threshold amount. When value is due to the counterparty the Group is required to post collateral on identical terms. Such cash collateral is adjusted daily as necessary.
In the event of any default, ownership of the cash collateral would revert to the respective holder at that point. Detailed below is the value of the cash collateral, which is reported within current borrowings, held by the Group at 31 March:
2022 | 2021 | |||
€m | €m | |||
Collateral liabilities |
| |
| |
In addition, as discussed in note 29 ‘Contingent liabilities and legal proceedings’, the Group has covenanted to provide security in favour of the trustee of the Vodafone Group UK Pension Scheme in respect of the funding deficit in the scheme and pledged security in relation to the Indus Towers merger. The Group has also pledged cash as collateral against derivative financial instruments as disclosed in note 13 ‘Other investments’.
Notes to the consolidated financial statements (continued) | |
Operating activities
Customer credit risk is managed by the Group’s business units which each have policies, procedures and controls relating to customer credit risk management. Outstanding trade receivables and contract assets are regularly reviewed to monitor any changes in credit risk with concentrations of credit risk considered to be limited given that the Group’s customer base is large and unrelated. The Group applies the simplified approach and records lifetime expected credit losses for trade receivables and contract assets. Expected credit losses are measured using historical cash collection data for periods of at least
Movements in the allowance for expected credit losses during the year were as follows:
Trade receivables held | ||||||||||||
Trade receivables held | at fair value through | |||||||||||
Contract assets | at amortised cost | other comprehensive income | ||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 |
| 2022 |
| 2021 | |
€m | €m | €m | €m | €m | €m | |||||||
1 April |
| |
| |
| |
| |
| |
| |
Exchange movements |
| |
| |
| ( |
| ( |
| — |
| – |
Amounts charged to credit losses on financial assets |
| |
| |
| |
| |
| |
| |
Other1 |
| ( |
| ( |
| ( |
| ( |
| ( |
| ( |
31 March |
| |
| |
| |
| |
| |
| |
Note:
| 1 | Primarily utilisation of the provision. |
Expected credit losses are presented as net impairment losses within operating profit and subsequent recoveries of amounts previously written off are credited against the same line item.
The majority of the Group's trade receivables are due for maturity within 90 days and largely comprise amounts receivable from consumers and business customers.
The following table presents information on trade receivables past due¹ and their associated expected credit losses:
Trade receivables at amortised cost past due | ||||||||||||
30 days | 31-60 | 61-180 | 180 | |||||||||
Due | or less | days | days | days+ | Total | |||||||
31 March 2022 |
| €m | €m |
| €m |
| €m |
| €m |
| €m | |
Gross carrying amount |
| | |
| |
| |
| |
| | |
Expected credit loss allowance |
| ( | ( |
| ( |
| ( |
| ( |
| ( | |
Net carrying amount |
| | |
| |
| |
| |
| | |
Trade receivables at amortised cost past due | ||||||||||||
30 days | 31–60 | 61–180 | 180 | |||||||||
Due | or less | days | days | days+ | Total | |||||||
31 March 2021 |
| €m | €m |
| €m |
| €m |
| €m |
| €m | |
Gross carrying amount |
| | |
| |
| |
| |
| | |
Expected credit loss allowance |
| ( | ( |
| ( |
| ( |
| ( |
| ( | |
Net carrying amount |
| | |
| |
| |
| |
| | |
Note:
| 1 | Contract assets relate to amounts not yet due from customers. These amounts will be reclassified as trade receivables before they become due. Trade receivables at fair value through other comprehensive income are not materially past due. |
Liquidity risk
Liquidity is reviewed daily on at least a 12 month rolling basis and stress tested on the assumption that any commercial paper outstanding matures and is not reissued. The Group maintains substantial cash and cash equivalents which at 31 March 2022 amounted to cash €
Notes to the consolidated financial statements (continued) | |||
euro and US dollar revolving credit facilities of €
The maturity profile of the anticipated future cash flows including interest in relation to the Group’s non-derivative financial liabilities on an undiscounted basis which, therefore, differs from both the carrying value and fair value, is as follows:
Trade payables and | ||||||||||||||
Bank loans | Bonds | Lease liabilities | Other2 | Total borrowings | other financial liabilities3 | Total | ||||||||
Maturity profile1 | €m | €m | €m | €m | €m | €m | €m | |||||||
Within one year |
| |
| |
| |
| |
| |
| | | |
In one to two years |
| |
| |
| |
| |
| |
| | | |
In two to three years |
| |
| |
| |
| |
| |
| — | | |
In three to four years |
| |
| |
| |
| |
| |
| — | | |
In four to five years |
| |
| |
| |
| |
| |
| — | | |
In more than five years |
| |
| |
| |
| |
| |
| — | | |
| |
| |
| |
| |
| |
| | | ||
Effect of discount/financing rates |
| ( |
| ( |
| ( |
| ( |
| ( |
| ( | ( | |
31 March 2022 |
| |
| |
| |
| |
| |
| | | |
Within one year |
| |
| |
| |
| |
| |
| | | |
In one to two years |
| |
| |
| |
| |
| |
| | | |
In two to three years |
| |
| |
| |
| |
| |
| – | | |
In three to four years |
| |
| |
| |
| |
| |
| – | | |
In four to five years |
| |
| |
| |
| |
| |
| – | | |
In more than five years |
| |
| |
| |
| |
| |
| – | | |
| |
| |
| |
| |
| |
| | | ||
Effect of discount/financing rates |
| ( |
| ( |
| ( |
| ( |
| ( |
| ( | ( | |
31 March 2021 |
| |
| |
| |
| |
| |
| | |
Notes:
1 | Maturities reflect contractual cash flows applicable except in the event of a change of control or event of default, upon which lenders have the right, but not the obligation, to request payment within 30 days. This also applies to undrawn committed facilities. There is |
2 | Includes spectrum licence payables with maturity profile € |
3 | Includes financial liabilities under put option arrangements and non-derivative financial liabilities presented within trade and other payables. |
The maturity profile of the Group’s financial derivatives (which include interest rate swaps, cross-currency interest rate swaps and foreign exchange swaps) using undiscounted cash flows, is as follows:
2022 | 2021 | |||||||||||
Payable | Receivable | Total | Payable | Receivable | Total | |||||||
| €m |
| €m |
| €m |
| €m |
| €m |
| €m | |
Within one year | ( | | | ( | | | ||||||
In one to two years | ( | | | ( | | | ||||||
In two to three years | ( | | | ( | | | ||||||
In three to four years | ( | | | ( | | | ||||||
In four to five years | ( | | | ( | | | ||||||
In more than five years | ( | | | ( | | | ||||||
( | | | ( | | | |||||||
Effect of discount/financing rates |
|
| ( |
|
| ( | ||||||
Financial derivative net receivable/(payable) |
|
| |
|
| ( | ||||||
Payables and receivables are stated separately in the table above as cash settlement is on a gross basis.
Notes to the consolidated financial statements (continued) | |
Market risk
Interest rate management
Under the Group’s interest rate management policy, interest rates on long-term monetary assets and liabilities are principally maintained on a fixed rate basis.
At 31 March 2022 and after hedging, substantially all of our outstanding liabilities are held on a fixed interest rate basis in accordance with treasury policy.
For each
At 31 March 2022, the Group had limited exposure through interest rate derivatives and floating rate bonds referencing LIBOR and other interbank offered rates (IBORs).
Foreign exchange management
As Vodafone’s primary listing is on the London Stock Exchange its share price is quoted in sterling. Since the sterling share price represents the value of its future multi-currency cash flows, principally in euro, South African rand and sterling, the Group maintains the currency of debt and interest charges in proportion to its expected future principal cash flows and has a policy to hedge external foreign exchange risks on transactions denominated in other currencies above a certain de minimis level.
At 31 March 2022
Under the Group’s foreign exchange management policy, foreign exchange transaction exposure in Group companies is generally maintained at the lower of €
The Group recognises foreign exchange movements in equity for the translation of net investment hedging instruments and balances treated as investments in foreign operations. However, there is no net impact on equity for exchange rate movements on net investment hedging instruments as there would be an offset in the currency translation of the foreign operation. At 31 March 2022 the Group held financial liabilities in a net investment hedge against the Group’s South African rand operations. Sensitivity to foreign exchange movements on the hedging liabilities, analysed against a strengthening of the South African rand by
The Group profit and loss account is exposed to foreign exchange risk within both operating profit and financing income and expense. The principal reporting segment not generating income in euro is Vodacom, whose functional currency is predominantly South African rand. Financing income and expense includes foreign currency gains/losses incurred on the translation of balance sheet items not held in functional currency. These are principally on certain borrowings, derivatives, and other investments denominated in sterling and Turkish lira.
The following table details the Group’s sensitivity to foreign exchange risk. The percentage movement applied to the currency is based on the average movements in the previous three annual reporting periods.
2022 | 2021 | |||
| €m |
| €m | |
Increase/ (decrease) in Profit before taxation | ||||
ZAR |
| |
| |
TRY | | | ||
GBP |
| ( |
| ( |
Equity risk
There is no material equity risk relating to the Group’s equity investments which are detailed in note 13 ‘Other investments’.
The Group has hedged its exposure under the subordinated mandatory convertible bonds to any future movements in its share price by an option strategy designed to hedge the economic impact of share price movements. As at 31 March 2022 the Group’s sensitivity to a movement of
Notes to the consolidated financial statements (continued) | |||
Risk management strategy of hedge relationships
The risk strategies of the designated cash flow, fair value, and net investment hedges reflect the above market risk strategies.
The objective of the cash flow hedges is principally to convert foreign currency denominated fixed rate borrowings in US dollar, pound sterling, Australian dollar, Swiss franc, Hong Kong dollar, Japanese yen, Norwegian krona and euro and US dollar floating rate borrowings into euro fixed rate borrowings and hedge the foreign exchange spot rate and interest rate risk. There are also cash flow hedges of certain subsidiary expenditure not denominated in functional currency of the entity, to hedge foreign exchange spot risk. Derivative financial instruments designated in cash flow hedges are cross-currency interest rate swaps and foreign exchange swaps and forwards. The swap maturity dates and liquidity profiles of the nominal cash flows match those of the underlying borrowings and exposures.
The objective of the net investment hedges is to hedge foreign exchange risk in foreign operations. Derivative financial instruments designated in net investment hedges are cross-currency interest rate swaps and foreign exchange swaps. The hedging instruments are rolled on an ongoing basis as determined by the nature of the business.
The objective of the fair value hedges is to hedge a proportion of the Group’s fixed rate euro denominated borrowing to a euro floating rate borrowing. The swap maturity dates match those of the underlying borrowing and the nominal cash flows are converted to quarterly payments.
Hedge effectiveness is determined at the inception of the hedge relationship and through periodic prospective effectiveness assessments to ensure that an economic relationship exists between the hedged item and hedging instrument.
For hedges of foreign currency denominated borrowings and investments, the Group uses a combination of cross-currency and foreign exchange swaps to hedge its exposure to foreign exchange risk and interest rate risk and enters into hedge relationships where the critical terms of the hedging instrument match with the terms of the hedged item. Therefore the Group expects a highly effective hedging relationship with the swap contracts and the value of the corresponding hedged items to change systematically in the opposite direction in response to movements in the underlying exchange rates and interest rates. The Group therefore performs a qualitative assessment of effectiveness. If changes in circumstances affect the terms of the hedged item such that the critical terms no longer match with the critical terms of the hedging instrument, the Group uses the hypothetical derivative method to assess effectiveness.
Hedge ineffectiveness may occur due to:
a) The fair value of the hedging instrument on the hedge relationship designation date if the fair value is not nil;
b) Changes in the contractual terms or timing of the payments on the hedged item; and
c) A change in the credit risk of the Group or the counterparty with the hedging instrument.
The hedge ratio for each designation will be established by comparing the quantity of the hedging instrument and the quantity of the hedged item to determine their relative weighting; for all of the Group’s existing hedge relationships the hedge ratio has been determined as 1:1.
The fair values of the derivative financial instruments are calculated by discounting the future cash flows to net present values using appropriate market rates and foreign currency rates prevailing at 31 March. The valuation basis is level 2 of the fair value hierarchy. This classification comprises items where fair value is determined from inputs other than quoted prices that are observable for the asset and liability, either directly or indirectly. Derivative financial assets and liabilities are included within trade and other receivables and trade and other payables in the statement of financial position.
Notes to the consolidated financial statements (continued) | |
The following table represents the carrying values and nominal amounts of derivatives in a continued hedge relationship as at 31 March.
Other comprehensive income | Weighted average | |||||||||||||||||||
Opening | (Gain)/ | Gain/(Loss) | Closing | |||||||||||||||||
Carrying | Carrying | balance | Loss | recycled to | balance | Euro | ||||||||||||||
Nominal | value | value | 1 April | deferred to | financing | 31 March | Maturity | interest | ||||||||||||
amounts | Assets | Liabilities | 2021 | OCI | costs | 20221 | year | FX rate | rate | |||||||||||
At 31 March 2022 |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
|
|
| % | ||
Cash flow hedges - foreign currency risk3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross-currency and foreign exchange swaps |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US dollar bonds |
| |
| |
| |
| |
| ( |
| |
| ( |
| 2036 |
| |
| |
Australian dollar bonds |
| |
| |
| – |
| ( |
| ( |
| |
| ( |
| 2024 |
| |
| |
Swiss franc bonds |
| |
| |
| |
| |
| ( |
| |
| |
| 2026 |
| |
| |
Pound sterling bonds |
| |
| |
| |
| |
| ( |
| |
| |
| 2043 |
| |
| |
Hong Kong dollar bonds |
| |
| |
| |
| |
| ( |
| |
| |
| 2028 |
| |
| |
Japanese yen bonds |
| |
| – |
| |
| |
| ( |
| ( |
| |
| 2037 |
| |
| |
Norwegian krona bonds |
| |
| – |
| |
| |
| ( |
| |
| |
| 2026 |
| |
| |
Foreign exchange forwards2 | | – | | – | ( | | ( | 2022 | | – | ||||||||||
Cash flow hedges - foreign currency and interest rate risk3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross currency swaps - US dollar bonds |
| |
| |
| – |
| |
| ( |
| |
| ( |
| 2023 |
| |
| |
Cash flow hedges - interest rate risk3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swaps - Euro loans |
| – |
| – |
| – |
| ( |
| – |
| |
| – |
| – |
| – |
| – |
Net investment hedge - foreign exchange risk5 |
|
|
| – |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross-currency and foreign exchange swaps - South African rand investment |
| |
| – |
| |
| |
| |
| – | |
| 2022 |
| |
| | |
| |
| |
| |
| |
| ( |
| |
| ( | |||||||
Notes to the consolidated financial statements (continued) | |||
Other comprehensive income | Weighted average | |||||||||||||||||||
Opening | Gain/(Loss) | Closing | ||||||||||||||||||
Carrying | Carrying | balance | (Gain)/Loss | recycled to | balance | Euro | ||||||||||||||
Nominal | value | value | 1 April | deferred to | financing | 31 March | Maturity | interest | ||||||||||||
amounts | Assets | Liabilities | 2020 | OCI | costs | 20211 | year | FX rate | rate | |||||||||||
At 31 March 2021 |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
|
|
| % | ||
Cash flow hedges – foreign currency risk3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross-currency and foreign exchange swaps |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
US dollar bonds |
| |
| |
| |
| ( |
| |
| ( |
| |
| 2036 |
| |
| |
Australian dollar bonds |
| |
| |
| – |
| ( |
| ( |
| |
| ( |
| 2024 |
| |
| |
Swiss franc bonds |
| |
| – |
| |
| |
| |
| ( |
| |
| 2026 |
| |
| |
Pound sterling bonds |
| |
| |
| |
| |
| |
| |
| |
| 2047 |
| |
| |
Hong Kong dollar bonds |
| |
| – |
| |
| ( |
| |
| ( |
| |
| 2028 |
| |
| |
Japanese yen bonds |
| |
| – |
| |
| |
| |
| ( |
| |
| 2037 |
| |
| |
Norwegian krona bonds |
| |
| – |
| |
| ( |
| ( |
| |
| |
| 2026 |
| |
| |
Cash flow hedges – foreign currency and interest rate risk3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross currency swaps - US dollar bonds |
| |
| – |
| |
| |
| |
| ( |
| |
| 2023 |
| |
| |
Cash flow hedges – interest rate risk3 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swaps – Euro loans |
| |
| – |
| – |
| |
| ( |
| |
| ( |
| 2021 |
| – |
| |
Fair value hedges – interest rate risk4 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest rate swaps – Eurobonds |
| |
| |
| – |
| – |
| – |
| – |
| – |
| 2028 |
| – |
| – |
Net investment hedge – foreign exchange risk5 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cross-currency and foreign exchange swaps – South African rand investment |
| |
| – |
| |
| |
| |
| – | |
| 2021 |
| |
| | |
| |
| |
| |
| ( |
| |
| ( |
| | |||||||
Notes:
| 1 | Fair value movement deferred into other comprehensive income includes € |
| 2 | Includes euro and US dollar forward contracts against Turkish lira to hedge foreign currency forecast expenditures in local markets. Notional amounts of € |
| 3 | For cashflow hedges, the movement in the hypothetical derivative (hedged item) mirrors that of the hedging instrument. Hedge ineffectiveness of the swaps designated in a cash flow hedge during the period was €nil (2021: €nil). |
| 4 | The fair value hedge was de-designated during the financial year. The carrying value of the bond de-designated during the financial year includes |
| 5 | € |
| 6 | Hedge ineffectiveness of swaps designated in a net investment hedge during the period was €nil (2021: €nil). |
Changes in assets and liabilities arising from financing activities
Notes to the consolidated financial statements (continued) | |
Assets and liabilities | ||||||||||
Derivative assets | Financial liabilities | arising from | ||||||||
Borrowings | and liabilities | under put options | Other liabilities | financing activities | ||||||
| €m |
| €m |
| €m |
| €m |
| €m | |
1 April 2021 | | | | | | |||||
Cash movements | ||||||||||
Proceeds from issuance of long-term borrowings | | | ||||||||
Repayment of borrowings | ( | ( | ||||||||
Net movement in short-term borrowings | | | ||||||||
Net movement in derivatives | – | ( | – | – | ( | |||||
Interest paid | ( | | ( | ( | ( | |||||
Purchase of treasury shares | | ( | ( | |||||||
Non-cash movements | ||||||||||
Fair value movements | ( | ( | ||||||||
Foreign exchange | | ( | – | ( | | |||||
Interest costs | | ( | | | | |||||
Lease additions | | | ||||||||
Other1 | | – | – | | | |||||
31 March 2022 | | ( | | | |
Assets and liabilities | ||||||||||
Derivative assets | Financial liabilities | arising from | ||||||||
Borrowings | and liabilities | under put options | Other liabilities | financing activities | ||||||
| €m |
| €m |
| €m |
| €m |
| €m | |
1 April 2020 | | ( | | | | |||||
Cash movements | ||||||||||
Proceeds from issuance of long-term borrowings | | | ||||||||
Repayment of borrowings | ( | ( | ||||||||
Net movement in short-term borrowings | ( | ( | ||||||||
Net movement in derivatives | – | | – | – | | |||||
Interest paid | ( | | ( | ( | ( | |||||
Purchase of treasury shares | – | – | – | ( | ( | |||||
Payments for settlement of written put options | – | – | ( | – | ( | |||||
Non-cash movements | ||||||||||
Fair value movements | ( | | – | – | | |||||
Foreign exchange | ( | | – | ( | ( | |||||
Interest costs | | ( | | | | |||||
Lease additions | | | ||||||||
Acquisitions of subsidiaries | | – | – | – | | |||||
Other1 | | | | | ||||||
31 March 2021 | | | | | |
Note:
1 | Movement in Other liabilities primarily relate to share buyback programmes. |
Fair value and carrying value information
The carrying value and valuation basis of the Group’s financial assets are set out in notes 13 ‘Other investments’, 14 ‘Trade and other receivables’ and 19 ‘Cash and cash equivalents’. For all financial assets held at amortised cost the carrying values approximate fair value except as disclosed in note 13 ‘Other investments’.
The carrying value and valuation basis of the Group’s financial liabilities are set out in notes 15 ‘Trade and other payables’ and 21 ‘Borrowings’. The carrying values approximate fair value for the Group’s trade payables and other payables categories. For other financial liabilities a comparison of fair value and carrying value is disclosed in note 21 ‘Borrowings’.
Notes to the consolidated financial statements (continued) | |||
Net financial instruments
The table below shows the Group’s financial assets and liabilities that are subject to offset in the balance sheet and the impact of enforceable master netting or similar agreements.
Related amounts not set off in the balance sheet | |||||||||||||
Amounts | Right of set off | ||||||||||||
presented in | with derivative | Collateral | |||||||||||
Gross amount | Amount set off | balance sheet | counterparties | (liabilities)/assets1 | Net amount | ||||||||
At 31 March 2022 |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m | |
Derivative financial assets |
| |
| – |
| |
| ( |
| ( |
| | |
Derivative financial liabilities |
| ( |
| – |
| ( |
| |
| |
| | |
Total |
| |
| – |
| |
| – |
| ( |
| | |
Related amounts not set off in the balance sheet | ||||||||||||
Amounts | Right of set off | |||||||||||
presented in | with derivative | Collateral | ||||||||||
Gross amount | Amount set off | balance sheet | counterparties | (liabilities)/assets1 | Net amount | |||||||
At 31 March 2021 |
| €m |
| €m |
| €m |
| €m |
| €m |
| €m |
Derivative financial assets |
| |
| – |
| |
| ( |
| ( |
| |
Derivative financial liabilities |
| ( |
| – |
| ( |
| |
| |
| |
Total |
| ( |
| – |
| ( |
| – |
| |
| |
Note:
1 | Excludes collateral of € |
Financial assets and liabilities are offset and the net amount reported in the consolidated balance sheet when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously. Derivative financial instruments that do not meet the criteria for offset could be settled net in certain circumstances under ISDA (‘International Swaps and Derivatives Association’) agreements where each party has the option to settle amounts on a net basis in the event of default from the other. Collateral may be offset and net settled against derivative financial instruments in the event of default by either party. The aforementioned collateral balances are recorded in ‘other investments’ or ‘current borrowings’ respectively.
23. Directors and key management compensation
This note details the total amounts earned by the Company’s Directors and members of the Executive Committee.
Directors
Aggregate emoluments of the Directors of the Company were as follows:
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Salaries and fees |
| |
| |
| |
Incentive schemes1 |
| |
| |
| |
Other benefits2 |
| – |
| – |
| |
| |
| |
| |
Notes:
| 1 | Excludes gains from long-term incentive plans. |
| 2 | Includes the value of the cash allowance taken by some individuals in lieu of pension contributions. |
Key management compensation
Aggregate compensation for key management, being the Directors and members of the Executive Committee, was as follows:
2022 | 2021 | 2020 | ||||
Re-presented1 | Re-presented1 | |||||
€m | €m | €m | ||||
Short-term employee benefits |
| |
| |
| |
Share-based payments |
| |
| |
| |
| |
| |
| |
Notes to the consolidated financial statements (continued) | |
Note:
| 1 | The prior year comparatives for share-based payments have been re-presented to reflect the market value of the vested shares provided to key management personnel in the reported period. The previous presentation was based on the value of share awards granted and recognised over the vesting period, however the grants were subject to various vesting conditions. The revised measurement basis is considered to provide a more appropriate measure of actual compensation received by key management personnel in the period. The re-presentation decreases the previously disclosed amounts by € |
24. Employees
This note shows the average number of people employed by the Group during the year, in which areas of our business our employees work and where they are based. It also shows total employment costs.
| 2022 |
| 2021 |
| 2020 | |
Employees | Employees | Employees | ||||
By activity |
|
|
|
|
|
|
Operations |
| |
| |
| |
Selling and distribution |
| |
| |
| |
Customer care and administration |
| |
| |
| |
| |
| |
| | |
By segment |
|
|
| |||
Germany |
| |
| |
| |
Italy |
| |
| |
| |
Spain |
| |
| |
| |
UK |
| |
| |
| |
Other Europe |
| |
| |
| |
Vodacom |
| |
| |
| |
Other Markets |
| |
| |
| |
Vantage Towers1 | | – | – | |||
Common Functions |
| |
| |
| |
Total |
| |
| |
| |
Note:
1 | Vantage Towers is a new reporting segment for the year ended 31 March 2022. See Note 2 ‘Revenue disaggregation and segmental analysis’ for details. |
The cost incurred in respect of these employees (including Directors) was:
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Wages and salaries |
| |
| |
| |
Social security costs |
| |
| |
| |
Other pension costs (note 25) |
| |
| |
| |
Share-based payments (note 26) |
| |
| |
| |
Total |
| |
| |
| |
25. Post employment benefits
The Group operates a number of Defined Benefit and Defined Contribution retirement plans for our employees. The Group’s largest defined benefit plan is in the UK. For further details see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation’.
Accounting policies
For defined benefit retirement plans, the difference between the fair value of the plan assets and the present value of the plan liabilities is recognised as an asset or a liability on the consolidated statement of financial position. Defined benefit plan liabilities are assessed using the projected unit funding method and applying the principal actuarial assumptions at the reporting period date. Assets are valued at market value.
Notes to the consolidated financial statements (continued) | |||
Actuarial gains and losses are taken to the consolidated statement of comprehensive income for defined benefit plans or consolidated income statement for cash leaver plans as incurred. For this purpose, actuarial gains and losses comprise both the effects of changes in actuarial assumptions and experience adjustments arising from differences between the previous actuarial assumptions and what has actually occurred. The return on plan assets, in excess of interest income, and costs incurred for the management of plan assets are also taken to other comprehensive income.
Other movements in the net surplus or deficit are recognised in the consolidated income statement, including the current service cost, any past service cost and the effect of any settlements. The interest cost less the expected interest income on assets is also charged to the consolidated income statement. The amount charged to the consolidated income statement in respect of these plans is included within operating costs or in the Group’s share of the results of equity accounted operations, as appropriate.
The Group’s contributions to defined contribution pension plans are charged to the consolidated income statement as they fall due.
Background
At 31 March 2022 the Group operated a number of retirement plans for the benefit of its employees throughout the world, with varying rights and obligations depending on the conditions and practices in the countries concerned. The Group’s philosophy is to provide access to defined contribution retirement plans where feasible and to manage legacy defined benefit retirement arrangements. Defined benefit plans provide benefits based on the employees’ length of pensionable service and their final pensionable salary or other criteria. Defined contribution plans offer employees individual funds that are converted into benefits at the time of retirement.
The Group operates defined benefit plans in Germany, India, Ireland, Italy, the UK, the United States; defined benefit indemnity plans in Greece and Turkey; and a cash leaver plan in India. Defined contribution plans are currently provided in Egypt, Germany, Greece, Hungary, India, Ireland, Italy, Portugal, South Africa, Spain and the UK.
Income statement expense
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Defined contribution plans |
| |
| |
| |
Defined benefit plans |
| ( |
| |
| |
Total amount charged to income statement (note 24) |
| |
| |
| |
Defined benefit plans
The Group’s retirement policy is to provide competitive pension provision, in each operating country, in line with the market median for that location. The Group’s preferred retirement provision is focused on Defined Contribution arrangements and/or State provision for future service.
The Group’s main defined benefit funding liability is the Vodafone UK Group Pension Scheme (‘Vodafone UK plan’). Since June 2014 the Vodafone UK plan has consisted of two segregated sections: the Vodafone Section and the Cable Wireless Section (‘CWW Section’). Both sections are closed to new entrants and to future accrual. The Group also operates smaller funded and unfunded plans in the UK, funded and unfunded plans in Germany and a funded plan in Ireland. Defined benefit pension provision exposes the Group to actuarial risks such as longer than expected longevity of participants, lower than expected return on investments and higher than expected inflation, which may increase the liabilities or reduce the value of assets of the plans.
During 2022 the Group consolidated its defined benefit plans with the mergers of a small plan in the UK, The J O Grant Taylor (London) Ltd Staff Pension Scheme, into the Vodafone Section of the Vodafone UK plan and of the Cable and Wireless Employee Benefits Scheme in Ireland into the Vodafone Ireland Pension Plan.
The main defined benefit plans are administered by trustee boards which are legally separate from the Group and consist of representatives who are employees, former employees or are independent from the Group. The trustee boards of the pension plans are required by legislation to act in the best interest of the participants, set the investment strategy and contribution rates and are subject to statutory funding regimes.
The Vodafone UK plan is registered as an occupational pension plan with HM Revenue and Customs (‘HMRC’) and is subject to UK legislation and operates within the framework outlined by the Pensions Regulator. UK legislation requires that pension plans are funded prudently and that valuations are undertaken at least every three years. Separate valuations are required for the Vodafone Section and CWW Section.
Notes to the consolidated financial statements (continued) | |
The trustees obtain regular actuarial valuations to check whether the statutory funding objective is met and whether a recovery plan is required to restore funding to the level of the agreed technical provisions. The 31 March 2019 triennial actuarial valuation for the Vodafone Section and CWW Section of the Vodafone UK plan showed a net deficit of £
These plan- specific actuarial valuations will differ to the IAS 19 accounting basis, which is used to measure pension assets and liabilities presented in the Group’s consolidated statement of financial position.
Following the 2019 triennial valuation, the Group and trustees of the Vodafone UK plan agreed a funding plan to address the valuation deficit in the Vodafone Section over the period to 31 March 2025 and made a cash contribution on 4 September 2020 of £
Funding plans are individually agreed for each of the Group’s other defined benefit plans with the respective trustees or governing board, taking into account local regulatory requirements. It is expected that ordinary contributions of €
The investment strategy for the UK plans is controlled by the trustees in consultation with the Group and the plans have no direct investments in the Group’s equity securities or in property or other assets currently used by the Group. The allocation of assets between different classes of investment is reviewed regularly and is a key factor in the trustee investment policy. The trustees aim to achieve the plan's investment objectives through investing partly in a diversified mix of growth assets which, over the long term, are expected to grow in value by more than the low risk assets. The low risk assets include cash and gilts, inflation and interest rate hedging and in substance insured pensioner annuity policies in both the Vodafone Section and CWW Sections of the Vodafone UK plan and an insured pensioner annuity policy in the Vodafone Ireland Pension Plan. A number of investment managers are appointed to promote diversification by assets, organisation and investment style and current market conditions and trends are regularly assessed, which may lead to adjustments in the asset allocation.
Actuarial assumptions
The Group’s plan liabilities are measured using the projected unit credit method using the principal actuarial assumptions set out below:
| 2022 |
| 2021 |
| 2020 | |
% | % | % | ||||
Weighted average actuarial assumptions used at 31 March1: |
|
|
|
|
|
|
Rate of inflation2 |
| |
| |
| |
Rate of increase in salaries3 |
| |
| |
| |
Discount rate |
| |
| |
| |
Notes:
| 1 | Figures shown represent a weighted average assumption of the individual plans. |
| 2 | The rate of increase in pensions in payment and deferred revaluation are dependent on the rate of inflation. |
| 3 | Relates only to schemes open to future accrual primarily in Germany, Ireland and India. |
Mortality assumptions used are based on recommendations from the individual local actuaries which include adjustments for the experience of the Group where appropriate. The Group’s largest plan is the Vodafone UK plan. Further life expectancies assumed for the UK plans are
Charges made to the consolidated income statement and consolidated statement of comprehensive income (‘SOCI’) on the basis of the assumptions stated above are:
Notes to the consolidated financial statements (continued) | |||
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Current service cost |
| |
| |
| |
Net past service (credit)/costs1 |
| ( |
| |
| – |
Net interest charge/(income) |
| |
| ( |
| |
Total net (credit)/cost included within staff costs |
| ( |
| |
| |
Actuarial gains/(losses) recognised in the SOCI |
| |
| ( |
| |
Note:
1 | A change in Germany relating to the provision of death and disability benefits effective from 1 April 2021 resulted in a past service credit of € |
Duration of the benefit obligations
The weighted average duration of the defined benefit obligation at 31 March 2022 is
Fair value of the assets and present value of the liabilities of the plans
The amount included in the consolidated statement of financial position arising from the Group’s obligations in respect of its defined benefit plans is as follows:
|
|
| Net surplus/ | |||
Assets | Liabilities | (deficit) | ||||
€m | €m | €m | ||||
1 April 2020 |
| |
| ( |
| |
Service cost |
| – |
| ( |
| ( |
Interest income/(cost) |
| |
| ( |
| |
Return on plan assets excluding interest income |
| |
| – |
| |
Actuarial losses arising from changes in financial assumptions |
| – |
| ( |
| ( |
Actuarial losses arising from experience adjustments |
| – |
| ( |
| ( |
Employer cash contributions |
| |
| – |
| |
Member cash contributions |
| |
| ( |
| – |
Benefits paid |
| ( |
| |
| – |
Exchange rate movements |
| |
| ( |
| ( |
Other movements |
| ( |
| |
| ( |
31 March 2021 |
| |
| ( |
| ( |
Service cost |
| – |
| ( |
| ( |
Past service credit | – | | | |||
Interest income/(cost) |
| |
| ( |
| ( |
Return on plan assets excluding interest income |
| |
| – |
| |
Actuarial gains arising from changes in demographic assumptions | – | | | |||
Actuarial gains arising from changes in financial assumptions |
| – |
| |
| |
Actuarial gains arising from experience adjustments | – | | | |||
Employer cash contributions |
| |
| – |
| |
Member cash contributions |
| |
| ( |
| – |
Benefits paid |
| ( |
| |
| – |
Exchange rate movements |
| |
| ( |
| |
Other movements |
| ( |
| |
| |
31 March 2022 |
| |
| ( |
| |
Notes to the consolidated financial statements (continued) | |
An analysis of the net surplus/(deficit) is provided below for the Group as a whole.
2022 | 2021 | |||
€m | €m | |||
Analysis of net surplus/(deficit): |
|
|
|
|
Total fair value of plan assets |
| |
| |
Present value of funded plan liabilities |
| ( |
| ( |
Net surplus/(deficit) for funded plans |
| |
| ( |
Present value of unfunded plan liabilities |
| ( |
| ( |
Net surplus/(deficit) |
| |
| ( |
Net surplus/(deficit) is analysed as: |
|
| ||
Assets1 |
| |
| |
Liabilities |
| ( |
| ( |
Note:
| 1 | Pension assets are deemed to be recoverable and there are no adjustments in respect of minimum funding requirements as economic benefits are available to the Group either in the form of future refunds or, for plans still open to benefit accrual, in the form of possible reductions in future contributions. |
An analysis of net surplus/(deficit) is provided below for the Vodafone UK plan, which is a funded plan. As part of the merger of the Vodafone UK plan and the Cable and Wireless Worldwide Retirement Plan (‘CWWRP’) plan on 6 June 2014 the assets and liabilities of the CWW Section are segregated from the Vodafone Section and hence are reported separately below.
CWW Section | Vodafone Section | ||||||||
2022 | 2021 | 2022 | 2021 | ||||||
€m | €m | €m | €m | ||||||
Analysis of net surplus/(deficit): |
|
|
|
|
|
|
| ||
Total fair value of plan assets |
| | |
|
| |
| | |
Present value of plan liabilities |
| ( | ( |
|
| ( |
| ( | |
Net surplus/(deficit) |
| | |
|
| |
| ( | |
Net surplus/(deficit) are analysed as: |
|
|
|
| |||||
Assets |
| | |
|
| |
| – | |
Liabilities |
| – | – |
|
| – |
| ( | |
Fair value of plan assets
2022 | 2021 | |||
€m | €m | |||
Cash and cash equivalents |
| |
| |
Equity investments: |
|
| ||
With quoted prices in an active market |
| |
| |
Without quoted prices in an active market |
| |
| |
Debt instruments: |
|
| ||
With quoted prices in an active market |
| |
| |
Without quoted prices in an active market |
| |
| |
Property: |
|
| ||
With quoted prices in an active market |
| |
| |
Without quoted prices in an active market |
| |
| |
Derivatives:1 |
|
| ||
Without quoted prices in an active market |
| |
| ( |
Investment fund |
| |
| |
Annuity policies | ||||
With quoted prices in an active market |
| |
| |
Without quoted prices | | | ||
Total |
| |
| |
Note:
1 | Derivatives include collateral held in the form of cash. Assets are valued using ‘level 2’ inputs under IFRS 13 ‘Fair Value Measurement’ principles and classified as unquoted accordingly. |
Notes to the consolidated financial statements (continued) | |||
The fair value of plan assets, which have been measured in accordance with IFRS 13 ‘Fair Value Measurement’, are analysed by asset category above and are subdivided by assets that have a quoted market price in an active market and those that do not, such as investment funds. Where available, the fair values are quoted prices (e.g. listed equity, sovereign debt and corporate bonds). Unlisted investments without quoted prices in an active market (e.g. private equity) are included at values provided by the fund manager in accordance with relevant guidance. Other significant assets are valued based on observable inputs such as yield curves. The Vodafone UK plan annuity policies fully match the pension obligations of those pensioners insured and therefore are set equal to the present value of the related obligations. Investment funds of €
The actual return on plan assets over the year to 31 March 2022 was a gain of €
Sensitivity analysis
Measurement of the Group’s defined benefit retirement obligation is sensitive to changes in certain key assumptions. The sensitivity analysis below shows how a reasonably possible increase or decrease in a particular assumption would, in isolation, result in an increase or decrease in the present value of the defined benefit obligation as at 31 March 2022.
| Rate of inflation |
| Rate of increase in salaries |
| Discount rate |
| Life expectancy | |||||||||
Decrease by | Increase by | Decrease by | Increase by | Decrease by | Increase by | Decrease by | Increase by | |||||||||
€m | €m | €m | €m | €m | €m | €m | €m | |||||||||
(Decrease)/increase in present value of defined benefit obligation1 |
| ( |
| |
| ( |
| |
| |
| ( |
| ( |
| |
Note:
| 1 | The sensitivity analysis may not be representative of an actual change in the defined benefit obligation as it is unlikely that changes in assumptions would occur in isolation of one another. In presenting this sensitivity analysis, the change in the present value of the defined benefit obligation has been calculated on the same basis as prior years using the projected unit credit method at the end of the year, which is the same as that applied in calculating the defined benefit obligation liability recognised in the statement of financial position. The rate of inflation assumption sensitivity factors in the impact of changes to all assumptions relating to inflation including the rate of increase in salaries, pension increases and deferred revaluations. |
26. Share-based payments
The Group has a number of share plans used to award shares to Executive Directors and employees as part of their remuneration package. A charge is recognised over the vesting period in the consolidated income statement to record the cost of these, based on the fair value of the award on the grant date.
Accounting policies
The Group issues equity-settled share-based awards to certain employees. Equity-settled share-based awards are measured at fair value (excluding the effect of non-market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-based award is expensed on a straight-line basis over the vesting period, based on the Group’s estimate of the shares that will eventually vest and adjusted for the effect of non-market-based vesting conditions. A corresponding increase in additional paid-in capital is also recognised.
Some share awards have an attached market condition, based on total shareholder return (‘TSR’), which is taken into account when calculating the fair value of the share awards. The valuation for the TSR is based on Vodafone’s ranking within the same group of companies, where possible, over the past five years.
The fair value of awards of non-vested shares is a calculation of the closing price of the Company’s shares on the day prior to the grant date, adjusted for the present value of the delay in receiving dividends where appropriate.
The maximum aggregate number of ordinary shares which may be issued in respect of share options or share plans will not (without shareholder approval) exceed:
– |
Notes to the consolidated financial statements (continued) | |
– |
Share options
Vodafone Sharesave Plan
Under the Vodafone Sharesave Plan UK staff may acquire shares in the Company through monthly savings of up to £
Share plans
Vodafone Group executive plans
Under the Vodafone Global Incentive Plan awards of shares are granted to Directors and certain employees. The release of these shares is conditional upon continued employment and for some awards achievement of certain performance targets measured over a three year period.
Vodafone Share Incentive Plan
Following a review of the UK all-employee plans it was decided that with effect from 1 April 2017 employees would no longer be able to contribute to the Share Incentive Plan and would therefore no longer receive matching shares. Individuals who hold shares in the plan will continue to receive dividend shares.
Movements in outstanding ordinary share options
Ordinary share options | |||||||||
2022 | 2021 | 2020 | |||||||
Millions | Millions | Millions | |||||||
1 April |
| |
| |
| | |||
Granted during the year |
| |
| |
| | |||
Forfeited during the year |
| ( |
| ( |
| ( | |||
Exercised during the year |
| ( |
| – |
| – | |||
Expired during the year |
| ( |
| ( |
| ( | |||
31 March |
| |
| |
| | |||
Weighted average exercise price: |
|
|
|
|
| ||||
1 April | £ | £ | £ | ||||||
Granted during the year | £ | £ | £ | ||||||
Forfeited during the year | £ | £ | £ | ||||||
Exercised during the year | £ | £ | £ | ||||||
Expired during the year | £ | £ | £ | ||||||
31 March | £ | £ | £ | ||||||
Summary of options outstanding
| 31 March 2022 |
| 31 March 2021 | ||||||||||
Weighted | Weighted | ||||||||||||
remaining | remaining | ||||||||||||
Weighted | average | Weighted | average | ||||||||||
Outstanding | average | contractual | Outstanding | average | contractual | ||||||||
shares | exercise | life | shares | exercise | life | ||||||||
Millions | price | Months | Millions | price | Months | ||||||||
Vodafone Group Sharesave Plan: |
|
|
|
|
|
|
|
|
|
|
| ||
£ | | £ |
|
| |
| £ |
| |||||
Notes to the consolidated financial statements (continued) | |||
Share awards
Movements in non-vested shares are as follows:
2022 |
| 2021 |
| 2020 | |||||||||||
Weighted | Weighted | Weighted | |||||||||||||
average fair | average fair | average fair | |||||||||||||
value at | value at | value at | |||||||||||||
Millions | grant date | Millions | grant date | Millions | grant date | ||||||||||
1 April |
| | £ |
| | £ |
| | £ | ||||||
Granted |
| | £ |
| | £ |
| | £ | ||||||
Vested |
| ( | £ |
| ( | £ |
| ( | £ | ||||||
Forfeited |
| ( | £ |
| ( | £ |
| ( | £ | ||||||
31 March |
| | £ |
| | £ |
| | £ | ||||||
Other information
The total fair value of shares vested during the year ended 31 March 2022 was £
The compensation cost included in the consolidated income statement in respect of share options and share plans was €
The average share price for the year ended 31 March 2022 was
27. Acquisitions and disposals
The note below provides details of acquisition and disposal transactions for the current year as well as those completed in the prior year. For further details see ‘Critical accounting judgements and key sources of estimation uncertainty’ in note 1 ‘Basis of preparation’ to the consolidated financial statements.
Accounting policies
Business combinations
Acquisitions of subsidiaries are accounted for using the acquisition method. The cost of the acquisition is measured at the aggregate of the fair values at the date of exchange of assets given, liabilities incurred or assumed and equity instruments issued by the Group. Acquisition-related costs are recognised in the consolidated income statement as incurred. The acquiree’s identifiable assets and liabilities are recognised at their fair values at the acquisition date, which is the date on which control is transferred to the Group. Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the Group’s previously held equity interest in the acquiree, if any, over the net amounts of identifiable assets acquired and liabilities assumed at the acquisition date. The interest of the non-controlling shareholders in the acquiree may initially be measured either at fair value or at the non-controlling shareholders’ proportion of the net fair value of the identifiable assets acquired, liabilities and contingent liabilities assumed. The choice of measurement basis is made on an acquisition-by-acquisition basis.
Acquisition of interests from non-controlling shareholders
In transactions with non-controlling parties that do not result in a change in control, the difference between the fair value of the consideration paid or received and the amount by which the non-controlling interest is adjusted is recognised in equity.
Acquisitions
The aggregate cash consideration in respect of purchases of subsidiaries, net of cash acquired, is as follows:
| 2022 |
| 2021 | |
| €m |
| €m | |
Cash consideration paid |
|
| ||
Acquisitions during the year | – | 8 | ||
Net cash acquired |
| – |
| ( |
| – |
| |
Notes to the consolidated financial statements (continued) | |
During the prior year ended 31 March 2021, the Group completed acquisitions for an aggregate consideration of €
Disposals
The difference between the carrying value of the net assets disposed of and the fair value of consideration received is recorded as a gain or loss on disposal. Foreign exchange translation gains or losses relating to subsidiaries, joint arrangements and associates that the Group has disposed of, and that have previously recorded in other comprehensive income or expense, are also recognised as part of the gain or loss on disposal.
The aggregate cash consideration in respect of the disposal of subsidiaries, net of cash disposed, is as follows:
2022 | 2021 | |||
€m | €m | |||
Cash consideration received | ||||
Vodafone New Zealand | – | ( | ||
Tower infrastructure in Italy | – | | ||
Other disposals during the period | – | | ||
Net cash disposed | – | ( | ||
– | |
Other transactions with non-controlling shareholders in subsidiaries
2022 | 2021 | |||
€m | €m | |||
Cash consideration received/(paid) | ||||
Vantage Towers IPO | | | ||
Vantage Towers Greece | – | ( | ||
Other | ( | ( | ||
| |
Vantage Towers IPO
In the comparative period, the Group completed an initial public offering of Vantage Towers AG, with the first day of trading on the Regulated Market of the Frankfurt Stock Exchange being 18 March 2021. The offer consisted solely of a secondary sell-down of existing shares held by Vodafone GmbH. Cash consideration of €
Vantage Towers Greece
In the comparative period on 25 March 2021, the Group exercised its option to purchase the remaining
Other matters
Vodafone Egypt
On 10 November 2021, the Group announced that it had agreed to transfer its
The total consideration is €
Under the terms of the sale and purchase agreement, the cash element of the purchase consideration will be adjusted for any movement in the net debt and agreed working capital of Vodafone Egypt between signing and closing. Completion of the transaction is subject to a number of regulatory approvals, which are expected in the near term.
Notes to the consolidated financial statements (continued) | |||
28. Commitments
A commitment is a contractual obligation to make a payment in the future, mainly in relation to agreements to buy assets such as mobile devices, network infrastructure and IT systems and leases that have not commenced. These amounts are not recorded in the consolidated statement of financial position since we have not yet received the goods or services from the supplier. The amounts below are the minimum amounts that we are committed to pay.
Capital commitments
| Company and subsidiaries |
| Share of joint operations |
| Group | |||||||
2022 | 2021 | 2022 | 2021 | 2022 | 2021 | |||||||
€m | €m | €m | €m | €m | €m | |||||||
Contracts placed for future capital expenditure not provided in the financial statements1 |
| |
| |
| |
| |
| |
| |
Note:
| 1 | Commitment includes contracts placed for property, plant and equipment and intangible assets. |
Leases entered into by the Group but not commenced at 31 March 2022 are disclosed in note 20 ‘Leases’. Included in capital commitments is an amount of €
29. Contingent liabilities and legal proceedings
Contingent liabilities are potential future cash outflows, where the likelihood of payment is considered more than remote, but is not considered probable or cannot be measured reliably.
2022 | 2021 | |||
| €m |
| €m | |
Performance bonds1 |
| |
| |
Other guarantees2 |
| |
| |
Notes:
| 1 | Performance bonds require the Group to make payments to third parties in the event that the Group does not perform what is expected of it under the terms of any related contracts or commercial arrangements. |
| 2 | Other guarantees principally comprise Vodafone Group Plc’s guarantee of the Group’s |
UK pension schemes
The Group’s main defined benefit plan is the Vodafone UK Group Pension Scheme (‘Vodafone UK Plan’) which has two segregated sections, the Vodafone Section and the CWW Section, as detailed in note 25 ‘Post employment benefits’.
The Group has covenanted to provide security in favour of both the Vodafone Section and CWW Section when they are in a deficit position. The deficit is measured on a prescribed basis agreed between the Group and trustee, which differs from the accounting basis reported in note 25 'Post employment benefits'. The Group provides surety bonds as the security.
The level of the security has varied since inception in line with the movement in the Vodafone UK Plan deficit. Due to the improved funding position of the Plan the level of security has reduced significantly over the year. As at 31 March 2022 the Vodafone UK Plan retains security over €
An additional smaller UK defined benefit plan, the THUS Plc Group Scheme, has a guarantee from the Company for up to €
Notes to the consolidated financial statements (continued) | |
Vodafone Idea
As part of the agreement to merge Vodafone India and Idea Cellular in 2017, the parties agreed a mechanism for payments between the Group and Vodafone Idea Limited ('VIL') pursuant to the difference between the crystallisation of certain identified contingent liabilities in relation to legal, regulatory, tax and other matters, and refunds relating to Vodafone India and Idea Cellular. Cash payments or cash receipts relating to these matters must have been made or received by VIL before any amount becomes due from or owed to the Group. Any future payments by the Group to VIL as a result of this agreement would only be made after satisfaction of this and other contractual conditions.
The Group's potential exposure under this mechanism is capped at INR
VIL raised INR
Indus Towers
VIL’s ability to satisfy certain payment obligations under its Master Services Agreements with Indus Towers (the ‘MSAs’) is uncertain and depends on a number of factors including its ability to raise additional funding. Under the terms of the Indus and Bharti Infratel merger in November 2020, a security package was agreed for the benefit of the newly created merged entity, Indus Towers, which could be invoked in the event that VIL was unable to make MSA payments. The security package included the following elements:
| - | A prepayment in cash of INR |
| - | A primary pledge over |
| - | A secondary pledge over shares owned by Vodafone Group in Indus Towers (ranking behind Vodafone's existing lenders for the outstanding bank borrowings of € |
In the event of non-payment of relevant MSA obligations by VIL, Indus Towers would have recourse to the primary pledge shares and, after repayment of the Bank Borrowings in full, any secondary pledged shares, up to the value of the liability cap.
During February and March 2022, the Group announced the disposal of the
Indus Towers has recourse against the secondary pledge to the maximum liability cap, from any proceeds remaining after the settlement of the Bank Borrowings.
Legal Proceedings
The Group is currently involved in a number of legal proceedings, including inquiries from, or discussions with, government authorities that are incidental to its operations.
Notes to the consolidated financial statements (continued) | |||
Legal proceedings where the Group considers that the likelihood of material future outflows of cash or other resources is more than remote are disclosed below. Where the Group assesses that it is probable that the outcome of legal proceedings will result in a financial outflow, and a reliable estimate can be made of the amount of that obligation, a provision is recognised for these amounts.
In all cases, determining the probability of successfully defending a claim against the Group involves the application of judgement as the outcome is inherently uncertain. The determination of the value of any future outflows of cash or other resources, and the timing of such outflows, involves the use of estimates. The costs incurred in complex legal proceedings, regardless of outcome, can be significant.
The Group is not involved in any material proceedings in which any of the Group’s Directors, members of senior management or affiliates are either a party adverse to the Group or have a material interest adverse to the Group.
Indian tax cases
In January 2012, the Supreme Court of India found against the Indian tax authority and in favour of Vodafone International Holdings BV (‘VIHBV’) in proceedings brought after the Indian tax authority alleged potential liability under the Income Tax Act 1961 for the failure by VIHBV to deduct withholding tax from consideration paid to the Hutchison Telecommunications International Limited group (‘HTIL’) in connection with its 2007 disposal to VIHBV of its interests in a wholly-owned Cayman Island incorporated subsidiary that indirectly held interests in Vodafone India Limited (‘Vodafone India’).
The Finance Act 2012 of India, which amended various provisions of the Income Tax Act 1961 with retrospective effect, contained provisions intended to tax any gain on transfer of shares in a non-Indian company, which derives substantial value from underlying Indian assets, such as VIHBV’s transaction with HTIL in 2007. Further, it sought to subject a purchaser, such as VIHBV, to a retrospective obligation to withhold tax. On 3 January 2013, VIHBV received a letter from the Indian tax authority reminding it of the tax demand raised prior to the Supreme Court of India’s judgement and updating the interest element of that demand to a total amount of INR
VIHBV initiated arbitration proceedings under the Netherlands-India Bilateral Investment Treaty (‘Dutch BIT’) on 17 April 2014. In September 2020, the arbitration tribunal issued its award unanimously ruling in Vodafone’s favour. The Indian Government applied to set aside the award primarily on jurisdictional grounds. The proceedings have been transferred to the Singapore International Commercial Court (‘SICC’).
Separately, on 24 January 2017, Vodafone Group Plc and Vodafone Consolidated Holdings Limited formally commenced arbitration with the Indian Government under the United Kingdom-India Bilateral Investment Treaty (‘UK BIT’). Although relating to the same underlying facts as the claim under the Dutch BIT, the UK BIT claim is a separate and distinct claim under a different treaty and includes independent claims relating to disputes between the Indian tax authority and Vodafone India Services Private Limited (‘VISPL’) (see below). In 2020, following attempts by the Indian Government to obtain a court injunction preventing Vodafone from progressing the UK BIT arbitration, the Delhi High Court ordered that Vodafone shall proceed with the UK BIT arbitration only if the award already published under the Dutch BIT is set aside.
In August 2021 the Indian Parliament passed new legislation which affects the retrospective effect of the Finance Act 2012. The impact of this legislation on the Dutch and UK BIT proceedings, in particular whether the Indian Government will withdraw its challenge to the arbitration award in the Dutch BIT, is unknown as of the date of this report. The SICC granted a stay in the Dutch BIT proceedings to 15 June 2022.
VIHBV and Vodafone Group Plc will continue to defend vigorously any allegation that VIHBV or Vodafone India is liable to pay tax in connection with the transaction with HTIL. Based on the facts and circumstances of this matter, including the outcome of legal proceedings to date, the Group considers that it is more likely than not that no present obligation exists at 31 March 2022.
VISPL tax claims
VISPL is involved in a number of tax cases. The total value of the claims is approximately €
Of the individual tax claims, the most significant is in the amount of approximately €
Notes to the consolidated financial statements (continued) | |
2015, the Bombay High Court ruled in favour of Vodafone in relation to the options and the call centre sale. The Indian Tax Authority has appealed to the Supreme Court of India. The appeal hearing has been adjourned indefinitely.
While there is some uncertainty as to the outcome of the tax cases involving VISPL, the Group believes it has valid defences and does not consider it probable that a financial outflow will be required to settle these cases.
Other cases in the Group
Spain and UK: TOT v Vodafone Group Plc, VGSL, and Vodafone UK
The Group has been defending cases brought against it in Spain and the UK by TOT Power Control and Top Optimized Technologies (jointly ‘TOT’) alleging breach of confidentiality and patent infringement. In November 2021 TOT withdrew all of its claims against the Group in Spain and the UK as part of an agreed settlement.
Further background relating to these claims is provided in the Group’s Annual Report for the financial year ended 31 March 2021.
Germany: Kabel Deutschland takeover - class actions
The German courts have been determining the adequacy of the mandatory cash offer made to minority shareholders in Vodafone’s takeover of Kabel Deutschland. Hearings took place in May 2019 and a decision was delivered in November 2019 in Vodafone’s favour, rejecting all claims by minority shareholders. A number of shareholders appealed which was rejected by the court in December 2021. Several minority shareholders have filed a further appeal before the Federal Court of Justice. The appeal process is ongoing. While the outcome is uncertain, the Group believes it has valid defences and that the outcome of the appeal will be favourable to Vodafone.
Italy: Iliad v Vodafone Italy
In July 2019, Iliad filed a claim for €
The Group is currently unable to estimate any possible loss in this claim in the event of an adverse judgement but while the outcome is uncertain, the Group believes it has valid defences and that it is probable that no present obligation exists.
Greece: Papistas Holdings SA, Mobile Trade Stores (formerly Papistas SA) and Athanasios and Loukia Papistas v Vodafone Greece
In October 2019, Mr. and Mrs. Papistas, and companies owned or controlled by them, filed several new claims against Vodafone Greece with a total value of approximately €
The amount claimed in these lawsuits is substantial and, if the claimants are successful, the total potential liability could be material. However, we are continuing vigorously to defend the claims and based on the progress of the litigation so far the Group believes that it is highly unlikely that there will be an adverse ruling for the Group. On this basis, the Group does not expect the outcome of these claims to have a material financial impact.
UK: Phones 4U in Administration v Vodafone Limited and Vodafone Group Plc and Others
In December 2018, the administrators of former UK indirect seller, Phones 4U, sued the three main UK mobile network operators (‘MNOs’), including Vodafone, and their parent companies. The administrators allege collusion between the MNOs to pull their business from Phones 4U thereby causing its collapse. Vodafone and the other defendants filed their defences in April 2019 and the Administrators filed their replies in October 2019. Disclosure has taken place and witness statements were filed in December 2021. The judge has also ordered that there should be a split trial between liability and damages. The first trial started in May 2022.
Taking into account all available evidence, the Group assesses it to be more likely than not that a present obligation does not exist and that the allegations of collusion are completely without merit; the Group is vigorously defending the claim. The value of the claim is not pleaded but we understand it to be the total value of the business, allegedly equivalent to approximately £
Notes to the consolidated financial statements (continued) | |||
billion with the addition of alleged exemplary damages. Vodafone’s alleged share of the liability is also not pleaded. The Group is not able to estimate any possible loss in the event of an adverse judgment.
30. Related party transactions
The Group has a number of related parties including joint arrangements and associates, pension schemes and Directors and Executive Committee members (see note 12 ‘Investments in associates and joint arrangements’, note 25 ‘Post employment benefits’ and note 23 ‘Directors and key management compensation’).
Transactions with joint arrangements and associates
Related party transactions with the Group’s joint arrangements and associates primarily comprise fees for the use of products and services including network airtime and access charges, fees for the provision of network infrastructure and cash pooling arrangements. No related party transactions have been entered into during the year which might reasonably affect any decisions made by the users of these consolidated financial statements except as disclosed below.
2022 | 2021 | 2020 | ||||
€m | €m | €m | ||||
Sales of goods and services to associates |
| |
| |
| |
Purchase of goods and services from associates |
| |
| |
| |
Sales of goods and services to joint arrangements |
| |
| |
| |
Purchase of goods and services from joint arrangements |
| |
| |
| |
Interest income receivable from joint arrangements1 | | | | |||
Interest expense payable to joint arrangements1 |
| |
| |
| – |
Trade balances owed: |
|
|
| |||
by associates |
| |
| |
| |
to associates |
| |
| |
| |
by joint arrangements |
| |
| |
| |
to joint arrangements |
| |
| |
| |
Other balances owed by associates | | | – | |||
Other balances owed by joint arrangements1 |
| |
| |
| |
Other balances owed to joint arrangements2 |
| |
| |
| |
Notes:
| 1 | Amounts arise primarily through VodafoneZiggo, TPG Telecom Limited and INWIT S.p.A.. Interest is paid in line with market rates. |
| 2 | Amounts are primarily in relation to leases of tower space from INWIT S.p.A. |
Dividends received from associates and joint ventures are disclosed in the consolidated statement of cash flows.
Transactions with Directors other than compensation
During the three years ended 31 March 2022 and as of 16 June 2022, no Director nor any other executive officer, nor any associate of any Director or any other executive officer, was indebted to the Group. During the three years ended 31 March 2022 and as of 16 June 2022, the Group has not been a party to any other material transaction, or proposed transactions, in which any member of the key management personnel (including Directors, any other executive officer, senior manager, any spouse or relative of any of the foregoing or any relative of such spouse) had or was to have a direct or indirect material interest.
Notes to the consolidated financial statements (continued) | |
31. Related undertakings
A full list of all of our subsidiaries, joint arrangements and associated undertakings is detailed below.
A full list of subsidiaries, joint arrangements and associated undertakings (as defined in the Large and Medium-sized Companies and Groups (Accounts and Reports) Regulations 2008) as at 31 March 2022 is detailed below. No subsidiaries are excluded from the Group consolidation. Unless otherwise stated the Company’s subsidiaries all have share capital consisting solely of ordinary shares and are indirectly held. The percentage held by Group companies reflect both the proportion of nominal capital and voting rights unless otherwise stated. Summarised financial information is provided in respect of the Group's most significant joint arrangements and associates in note 12 'Investments in associates and joint arrangements'.
Subsidiaries
Accounting policies
A subsidiary is an entity directly or indirectly controlled by the Company. Control is achieved where the Company has existing rights that give it the current ability to direct the activities that affect the Company’s returns and exposure or rights to variable returns from the entity. The results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the effective date of acquisition or up to the effective date of disposal, as appropriate. Where necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation. Non-controlling interests in the net assets of consolidated subsidiaries are identified separately from the Group’s equity therein. Non-controlling interests consist of the amount of those interests at the date of the original business combination and the non-controlling shareholder’s share of changes in equity since the date of the combination. Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling interests having a deficit balance.
Notes to the consolidated financial statements (continued) | |||
Company name | % of share class held | Share class |
Albania | ||
Autostrada Tirane-Durres, Rruga: “Pavaresia”, Nr 61, Kashar, Tirana, Albania | ||
Vodafone Albania Sh.A | | Ordinary shares |
| ||
ApNet SHPK | | Ordinary shares |
Rruga Ibrahim Rugova, Sky Tower, Kati i 5, Hyrja 2, Tiranë, 1000, Albania | ||
_VOIS Albania ShpK. | | Ordinary shares |
Argentina | ||
Cerrito 348, 5 to B, C1010AAH, Buenos Aires, Argentina | ||
CWGNL S.A. (in process of dissolution) | | Ordinary shares |
Australia | ||
Mills Oakley , Level 7, 151 Clarence Street, Sydney NSW 2000, Australia | ||
Vodafone Enterprise Australia Pty Limited | | Ordinary shares |
Austria | ||
c/o Stolitzka Partner Rechtsanwälte OG, Kärntner Ring 12, 3. Stock, 1010, Wien, Austria | ||
Vodafone Enterprise Austria GmbH | | Ordinary shares |
Bahrain | ||
RSM Bahrain, 3rd Floor Falcon Tower, Diplomatic Area, Manama, PO BOX 11816, Bahrain | ||
Vodafone Enterprise Bahrain W.L.L. | | Ordinary shares |
Belgium | ||
Malta House, rue Archimède 25, 1000 Bruxelles, Belgium | ||
Vodafone Belgium SA/NV | | Ordinary shares |
Brazil | ||
Avenida Cidade Jardim, 400, 7th and 20th Floors, Jardim Paulistano, São Paulo, Brazil, 01454-000 | ||
Vodafone Serviços Empresariais Brasil Ltda. | | Ordinary shares |
Av José Rocha Bonfim, 214, Cond Praça Capital - Edifício Toronto, sls 228/229 13080-900 Jardim Santa Genebra - Campinas, São Paulo, Brazil | ||
Cobra do Brasil Serviços de Telemàtica ltda. (in process of dissolution) | | Ordinary shares |
Av Paulista 37 - 4º andar, Sala 427, Bela Vista, CEP, 01311 - 902, São Paulo, Brazil | ||
Vodafone Empresa Brasil Telecomunicações Ltda | | Ordinary shares |
Bulgaria | ||
10 Tsar Osvoboditel Blvd., 3rd Floor, Spredets Region, Sofia, 1000, Bulgaria | ||
Vodafone Enterprise Bulgaria EOOD | | Ordinary shares |
Canada | ||
c/o ARC Information Services Inc., 3-84 Castlebury Crescent, Toronto ON M2H 1W8, Canada | ||
Vodafone Canada Inc. | | Common shares |
Cayman Islands | ||
One Nexus Way, Camana Bay, Grand Cayman, KY1-9005, Cayman Islands | ||
CGP Investments (Holdings) Limited | | Ordinary shares |
Chile | ||
222 Miraflores, P.28, Santiago, Metrop, 97-763, Chile | ||
Vodafone Enterprise Chile S.A. | | Ordinary shares |
China | ||
Building 21, 11, Kangding St., BDA, Beijing, 100176 - China | ||
Vodafone Automotive Technologies (Beijing) Co, Ltd | | Ordinary shares |
Level 9, Tower 2, China Central Place, Room 941, No.79 Jianguo Road, Chaoyang District, Beijing, 100025, China | ||
Vodafone Enterprise Communications Technical Service (Shanghai) Co., Ltd. Beijing Branch2 | | Branch |
Room 1603, 16th Floor, 1200 Pudong Avenue, Free Trade Zone, Shanghai, China |
Notes to the consolidated financial statements (continued) | |
Vodafone Enterprise Communications Technical Service (Shanghai) Co., Ltd. | | Ordinary shares |
Congo, The Democratic Republic of the | ||
292 Avenue de La Justice, Commune de la Gombe, Kinshasa, The Democratic Republic of the Congo | ||
Vodacom Congo (RDC) SA5 | | Ordinary shares |
Building Comimmo II Ground Floor Right, 3157 Boulevard du 30 Juin, Commune de la Gombe, Kinshasa, DRC Congo, The Democratic Republic of the | ||
Vodacash S.A.5 | | Ordinary shares |
Cyprus | ||
Ali Rıza Efendi Caddesi No:33/A Ortaköy, Lefkoşa, Cyprus | ||
Vodafone Evde Operations Ltd | | Ordinary shares |
Vodafone Mobile Operations Limited | | Ordinary shares |
Czech Republic | ||
náměstí Junkových 2, Prague 5, Czech Republic, 155 00, Czech Republic | ||
Nadace Vodafone Česká Republika | | Trustee |
Oskar Mobil S.R.O. | | Ordinary shares |
Vodafone Czech Republic A.S. | | Ordinary shares |
Vodafone Enterprise Europe (UK) Limited - Czech Branch2 | | Branch |
Praha 4, Nusle, Závišova 502/5, 14000, Czech Republic | ||
Vantage Towers 2 s.r.o. | | Ordinary shares |
Vantage Towers s.r.o. 4 | | Ordinary shares |
Závišova Real Estate, s.r.o. | | Ordinary shares |
Denmark | ||
Tuborg Boulevard 12, 2900, Hellerup, Denmark | ||
Vodafone Enterprise Denmark A/S | | Ordinary (DKK) shares |
Egypt | ||
37 Kaser El Nil St, 4th. Floor,Cairo,Egypt | ||
Starnet | | Ordinary shares |
54 El Batal Ahmed Abed El Aziz, Mohandseen, Giza, Egypt | ||
Sarmady Communications | | Ordinary shares |
Building no. 2109 “VHUB1”, Smart Village, Cairo Alexandria, Egypt | ||
Vodafone International Services LLC | | Ordinary shares |
Site No 15/3C, Central Axis, 6th October City, Egypt | ||
Vodafone Egypt Telecommunications S.A.E. | | Ordinary shares |
Smart Village C3 Vodafone Building, Egypt | ||
Vodafone Data | | Ordinary shares |
Vodafone Building Zahraa EL Maadi, Building A, Service Area D, Maadi, Cairo, Egypt | ||
Vodafone For Trading | | Ordinary shares |
Finland | ||
c/o Eversheds Asianajotoimisto Oy, Fabianinkatu 29 B, Helsinki, 00100, Finland | ||
Vodafone Enterprise Finland OY | | Ordinary shares |
France | ||
1300 route de Cretes, Le WTC, Bat I1, 06560, Valbonne Soph, France | ||
Vodafone Automotive Telematics Development S.A.S | | Ordinary shares |
EuroPlaza Tour, 20 Avenue Andre Prothin, La Défense Cedex-France (149153), 92400, Courbevoie, France | ||
Vodafone Automotive France S.A.S | | Ordinary shares |
Vodafone Enterprise France SAS | | New euro shares |
Rue Champollion, 22300, Lannion, France | ||
Apollo Submarine Cable System Ltd – French Branch2 | | Branch |
Germany | ||
Aachener Str. 746-750, 50933, Köln, Germany |
Notes to the consolidated financial statements (continued) | |||
Arena Sport Rechte Marketing GmbH i.L (in liquidation) | | Ordinary shares |
Altes Forsthaus 2, 67661, Kaiserslautern, Germany | ||
TKS Telepost Kabel-Service Kaiserslautern GmbH3 | | Ordinary shares |
Betastraße 6-8, 85774 Unterföhring, Germany | ||
Kabel Deutschland Holding AG | | Ordinary shares |
Vodafone Customer Care GmbH3 | | Ordinary shares |
Vodafone Deutschland GmbH | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |
Company name | % of share class held | Share class |
Buschurweg 4, 76870, Kandel, Germany | ||
Vodafone Automotive Deutschland GmbH | | Ordinary shares |
Ferdinand-Braun-Platz 1, 40549, Duesseldorf, Germany | ||
Vodafone Enterprise Germany GmbH | | Ordinary shares |
Vodafone GmbH | | Ordinary A shares, Ordinary B shares |
Vodafone Group Services GmbH | | Ordinary shares |
Vodafone Institut für Gesellschaft und Kommunikation GmbH | | Ordinary shares |
Vodafone Stiftung Deutschland Gemeinnutzige GmbH | | Ordinary shares |
Vodafone Vierte Verwaltungs AG | | Ordinary shares |
Vodafone West GmbH | | Ordinary shares |
Friedrich-Wilhelm-Strasse 2, 38100, Braunschweig, Germany | ||
KABELCOM Braunschweig Gesellschaft Fur Breitbandkabel-Kommunikation Mit Beschrankter Haftung3 | | Ordinary shares |
Helmholtzstaße. 2-9, Gerbäude 10587, Berlin, Germany | ||
Vodafone Service GmbH | | Ordinary shares |
Holzmarkt 1, 50676, Köln, North Rhine-Westphalia, Germany | ||
Grandcentrix GmbH | | Ordinary shares |
Nobelstrasse 55, 18059, Rostock, Germany | ||
Urbana Teleunion Rostock GmbH Co.KG3 | | Ordinary shares |
Prinzenallee 11-13, 40549, Düsseldorf, Germany | ||
Vantage Towers AG | | Ordinary shares |
Vantage Towers Erste Verwaltungsgesellschaft mbH4 | | Ordinary shares |
Vantage Towers Zweite Verwaltungsgesellschaft mbH4 | | Ordinary shares |
Seilerstrasse 18, 38440, Wolfsburg, Germany | ||
KABELCOM Wolfsburg Gesellschaft Fur Breitbandkabel-Kommunikation Mit Beschrankter Haftung3 | | Ordinary shares |
Ghana | ||
Manet Tower A, South Liberation Link, Airport City, Accra, Ghana | ||
Ghana Telecommunications Company Limited | | Ordinary shares, Preference shares |
Vodacom Business (Ghana) Limited | | Ordinary shares, Preference shares |
Vodafone Ghana Mobile Financial Services Limited | | Ordinary shares |
Telecom House, Nsawam Road, Accra-North, Greater Accra Region, PMB 221, Ghana | ||
National Communications Backbone Company Limited | | Ordinary shares |
Greece | ||
1-3 Tzavella str, 152 31 Halandri, Athens, Greece | ||
Vodafone-Panafon Hellenic Telecommunications Company S.A. | | Ordinary shares |
12,5 km National Road Athens – Lamia, Metamorfosi / Athens, 14452, Greece | ||
Vodafone Innovus S.A. | | Ordinary shares |
2 Adrianeiou str, Athens, 11525, Greece | ||
Vantage Towers Single Member Societe Anonyme4 | | Ordinary shares |
Pireos 163 Ehelidon, Athens, 11854, Greece | ||
360 Connect S.A. | | Ordinary shares |
Guernsey | ||
Martello Court, Admiral Park, St. Peter Port, GY1 3HB, Guernsey | ||
FB Holdings Limited | | Ordinary shares |
Le Bunt Holdings Limited | | Ordinary shares |
Silver Stream Investments Limited | | Ordinary shares |
Roseneath, The Grange, St Peter Port, GY1 2QJ, Guernsey | ||
VBA Holdings Limited5 | | Ordinary shares |
VBA International Limited5 | | Ordinary shares, |
Hong Kong | ||
Level 24, Dorset House, Taikoo Place, 979 King’s Road, Quarry Bay, Hong Kong | ||
Vodafone Enterprise Hong Kong Ltd | | Ordinary shares |
Hungary | ||
40-44 Hungaria Krt., Budapest, H-1087, Hungary | ||
VSSB Vodafone Szolgáltató Központ Budapest Zártkörűen Működő Részvénytársaság | | Registered ordinary shares |
6 Lechner Ödön fasor, Budapest, 1096, Hungary | ||
Vantage Towers Zártkörűen Működő Részvénytársaság4 | Ordinary shares | |
Vodafone Magyarország Távközlési Zártkörűen Működő Részvénytársaság | | Series A Registered common shares |
India |
Notes to the consolidated financial statements (continued) | |||
10th Floor, Tower AB, Global Technology Park, (Maple Tree Building), Marathahalli Outer Ring Road, Devarabeesanahalli Village, Varthur Hobli, Bengaluru, Karnataka, 560103, India | ||
Cable Wireless Networks India Private Limited | | Equity shares |
Cable and Wireless (India) Limited - Branch2 | | Branch |
Cable and Wireless Global (India) Private Limited | | Equity shares |
201 - 206, Shiv Smriti Chambers, 49/A, Dr. Annie Besant Road, Worli, Mumbai, Maharashtra, 400018, India | ||
Omega Telecom Holdings Private Limited | | Equity shares |
Vodafone India Services Private Ltd | | Equity shares |
Business@Mantri, Tower B, Wing no - B1 B2, 3rd Floor, S. No. - 197, Near Hotel Four Points, Lohegaon, Pune, Maharashtra, 411014, India | ||
Vodafone Global Services Private Ltd | | Equity shares |
E-47, Bankra Super Market, Bankra, Howrah, West Bengal, 711403, India | ||
Usha Martin Telematics Limited | | Equity shares |
Ireland | ||
2nd Floor, Palmerston House, Fenian Street, Dublin 2, Ireland | ||
Vodafone International Financing Designated Activity Company | | Ordinary shares |
38/39 Fitzwilliam Square West, Dublin 2,D02 NX53, Ireland | ||
Vodafone Enterprise Global Limited | | Ordinary shares |
Vodafone Global Network Limited | | Ordinary shares |
Mountainview, Leopardstown, Dublin 18, Ireland | ||
Vantage Towers Limited4 | | Ordinary shares |
VF Ireland Property Holdings Limited | | Ordinary euro shares |
Vodafone Group Services Ireland Limited | | Ordinary shares |
Vodafone Ireland Limited | | Ordinary shares |
Vodafone Ireland Marketing Limited | | Ordinary shares |
Vodafone Ireland Retail Limited | | Ordinary shares |
Italy | ||
Piazzale Luigi Cadorna, 4, 20123, Milano, Italy | ||
Vodafone Global Enterprise (Italy) S.R.L. | | Ordinary shares |
SS 33 del Sempione KM 35, 212, 21052 Busto Arsizio (VA), Italy | ||
Vodafone Automotive Italia S.p.A | | Ordinary shares |
Via Astico 41, 21100 Varese, Italy | ||
Vodafone Automotive Electronic Systems S.r.L | | Ordinary shares |
Vodafone Automotive SpA | | Ordinary shares |
Vodafone Automotive Telematics Srl | | Ordinary shares |
Via Jervis 13, 10015, Ivrea, Tourin, Italy | ||
VEI S.r.l. | | Partnership interest shares |
Vodafone Italia S.p.A. | | Ordinary shares |
Via Lorenteggio 240, 20147, Milan, Italy | ||
Vodafone Enterprise Italy S.r.L | | Euro shares |
Vodafone Gestioni S.p.A. | | Ordinary shares |
Vodafone Servizi E Tecnologie S.R.L. | | Equity shares |
Notes to the consolidated financial statements (continued) | |
Company name | % of share class held | Share class |
Via per Carpi 26/B, 42015, Correggio (RE), Italy | ||
VND S.p.A | | Ordinary shares |
Japan | ||
KAKiYa building, 9F, 2-7-17 Shin-Yokohama, Kohoku-ku, Yokoha- City, Kanagawa, 222-0033, Japan | ||
Vodafone Automotive Japan KK | | Ordinary shares |
Marunouchi Trust Tower North 15F, 8-1, Marunouchi 1-chome, Level 15 , Chiyoda-ku, Tokyo, Japan | ||
Vodafone Enterprise U.K. – Japanese Branch2 | | Branch |
Vodafone Global Enterprise (Japan) K.K. | | Ordinary shares |
Jersey | ||
44 Esplanade, St Helier, JE4 9WG, Jersey | ||
Aztec Limited | | Ordinary shares |
Globe Limited | | Ordinary shares |
Plex Limited | | Ordinary shares |
Vizzavi Finance Limited | | Ordinary shares |
Vodafone International 2 Limited | | Ordinary shares |
Vodafone Jersey Dollar Holdings Limited | | Limited liability shares |
Vodafone Jersey Finance | | Ordinary shares |
Vodafone Jersey Yen Holdings Unlimited | | Limited liability shares |
Kenya | ||
6th Floor, ABC Towers, ABC Place, Waiyaki Way, Nairobi, 00100, Kenya | ||
M-PESA Holding Co. Limited | | Equity shares |
Vodafone Kenya Limited5 | | Ordinary voting shares |
The Riverfront, 4th floor, Prof. David Wasawo Drive, Off Riverside Drive, Nairobi, Kenya | ||
Vodacom Business (Kenya) Limited5 | Ordinary shares, Ordinary B shares | |
Korea, Republic of | ||
ASEM Tower Level 37, 517 Yeongdong-daero, Gangnam-gu, Seoul, 135-798, Korea, Republic of | ||
Vodafone Enterprise Korea Limited | | Ordinary shares |
Lesotho | ||
585 Mabile Road, Vodacom Park, Maseru, Lesotho | ||
Vodacom Lesotho (Pty) Limited5 | | Ordinary shares |
Luxembourg | ||
15 rue Edward Steichen, Luxembourg, 2540, Luxembourg | ||
Tomorrow Street GP S.à r.l. | | Ordinary shares |
Vodafone Asset Management Services S.à r.l. | | Ordinary shares |
Vodafone Enterprise Global Businesses S.à r.l. | | Ordinary shares |
Vodafone Enterprise Luxembourg S.A. | | Ordinary euro shares |
Vodafone International 1 S.à r.l. | | Ordinary shares |
Vodafone International M S.à r.l. | | Ordinary shares |
Vodafone Investments Luxembourg S.à r.l. | | Ordinary shares |
Vodafone Luxembourg 5 S.à r.l. | | Ordinary shares |
Vodafone Luxembourg S.à r.l. | | Ordinary shares |
Vodafone Procurement Company S.à r.l. | | Ordinary shares |
Vodafone Roaming Services S.à r.l. | | Ordinary shares |
Vodafone Services Company S.à r.l. | | Ordinary shares |
Malaysia | ||
Suite 13.03, 13th Floor, Menara Tan Tan, 207 Jalan Tun Razak, 50400 Kuala Lumpur, Malaysia | ||
Vodafone Global Enterprise (Malaysia) Sdn Bhd | | Ordinary shares |
Malta | ||
Portomaso Business Tower, Level 15B, St Julians, STJ 4011, Malta | ||
Vodafone Holdings Limited | | ‘A’ Ordinary shares, ‘B’ Ordinary shares |
Vodafone Insurance Limited | | ‘A’ Ordinary shares, ‘B’ Ordinary shares |
Mauritius | ||
10th Floor, Standard Chartered Towers, 19 Cybercity, Ebene, Mauritius | ||
Mobile Wallet VM15 | | Ordinary shares |
Mobile Wallet VM25 | | Ordinary shares |
VBA (Mauritius) Limited5 | | Ordinary shares, Redeemable preference shares |
Vodacom International Limited5 | | Ordinary shares, Non-cumulative preference shares |
Fifth Floor, Ebene Esplanade, 24 Bank Street, Cybercity, Ebene, Mauritius | ||
Al-Amin Investments Limited | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |||
Array Holdings Limited | | Ordinary shares |
Asian Telecommunication Investments (Mauritius) Limited | | Ordinary shares |
CCII (Mauritius), Inc. | | Ordinary shares |
CGP India Investments Ltd. | | Ordinary shares |
Euro Pacific Securities Ltd. | | Ordinary shares |
Mobilvest | | Ordinary shares |
Prime Metals Ltd. | | Ordinary shares |
Trans Crystal Ltd. | | Ordinary shares |
Vodafone Mauritius Ltd. | | Ordinary shares |
Vodafone Tele-Services (India) Holdings Limited | | Ordinary shares |
Vodafone Telecommunications (India) Limited | | Ordinary shares |
Mexico | ||
Avenida Insurgentes Sur No. 1647, Piso 12, despacho 1202, Colonia San José Insurgentes, Alcaldía Benito Juárez, C.P. 03900, Ciudad de México, Mexico | ||
Vodafone Empresa México S.de R.L. de C.V. | | Corporate certificate series A shares, Corporate certificate series B shares |
Mozambique | ||
Rua dos Desportistas, Numero 649, Cidade de Maputo, Mozambique | ||
Vodacom Moçambique, SA5 | | Ordinary shares |
Vodafone M-Pesa, S.A5 | | Ordinary shares |
Netherlands | ||
Rivium Quadrant 173, 15th Floor, 2909 LC, Capelle aan den IJssel, Netherlands | ||
Vodafone Enterprise Netherlands B.V. | | Ordinary shares |
Vodafone Europe B.V. | | Ordinary shares |
Vodafone International Holdings B.V. | | Ordinary shares |
Vodafone Panafon International Holdings B.V. | | Ordinary shares |
Rivium Quadrant 175, 2909 LC, Capelle aan den IJssel, Netherlands | ||
Central Tower Holding Company B.V. 4 | | Ordinary shares and special shares |
Zuid-hollanden 7, Rode Olifant, Spaces, 2596AL, den Haag, Netherlands | ||
IoT.nxt USA BV5 | | Ordinary shares |
IOT.NXT B.V.5 | | Ordinary shares |
IoT.nxt Europe BV5 | | Ordinary shares |
New Zealand | ||
74 Taharoto Road, Takapuna, Auckland, 0622, New Zealand | ||
Vodafone Enterprise Hong Kong Limited -New Zealand Branch2 | | Branch |
Norway | ||
c/o EconPartner AS, Dronning Mauds gate 15, Oslo, 0250, Norway | ||
Vodafone Enterprise Norway AS | | Ordinary shares |
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, United Kingdom | ||
Vodafone Limited – Norway Branch2 | | Branch |
Oman | ||
Knowledge Oasis Muscat, Al-seeb, Muscat, Governorate P.O Box 104 135, Oman | ||
Vodafone Services LLC | | Shares |
Poland | ||
ul. Towarowa 28, 00-839,Warsaw, Poland | ||
Vodafone Business Poland sp. z o.o. | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |
% of share class | ||
held by Group | ||
Company name | Companies | Share class |
Portugal | ||
Av. D. João II, nº 36 – 8º Piso, 1998 – 017, Parque das Nações, Lisboa, Portugal | ||
Oni Way - Infocomunicacoes, S.A | | Ordinary shares |
Vantage Towers, S.A.4 | | Ordinary shares |
Vodafone Enterprise Spain, S.L.U. – Portugal Branch2 | | Branch |
Vodafone Portugal – Comunicacoes Pessoais, S.A. | | Ordinary shares |
Romania | ||
1 A Constantin Ghercu Street, 10th Floor, 6th District, Bucharest, Romania | ||
UPC Services S.R.L. (in liquidation) | | Ordinary shares |
201 Barbu Vacarescu, 4th Floor, 2nd District, Bucharest, Romania | ||
Vodafone Romania S.A | | Ordinary shares |
201 Barbu Vacarescu, 5th Floor, 2nd District, Bucharest, Romania | ||
Vodafone External Services S.R.L. | | Ordinary shares |
201 Barbu Vacarescu Street, Mezzanine, District 2, Bucharest, Romania | ||
Vodafone Foundation | | Sole member |
201 Barbu Vacarescu Street, Mezzanine, Room 1, District 2, Bucharest, Romania | ||
Vantage Towers S.R.L.4 | | Ordinary shares |
62D Nordului Street, District 1, Bucharest, Romania | ||
UPC Foundation | | Sole member |
Oltenitei Street no. 2, City Offices Building, 3rd Floor, Bucharest, 4th District, Romania | ||
Vodafone România Technologies SRL | | Ordinary shares |
Sectorul 2, Strada Barbu Văcărescu, Nr. 201, Etaj 1, Bucharest, Romania | ||
Vodafone România M – Payments SRL | | Ordinary shares |
Șoseaua Vestului no. 1A, West Mall Ploiești, First Floor, Ploiești, Romania | ||
Evotracking SRL | | Ordinary shares |
Russian Federation | ||
Build. 2, 14/10, Chayanova str., 125047, Moscow, Russian Federation | ||
Cable Wireless CIS Svyaz LLC | | Charter capital shares |
Serbia | ||
Vladimira Popovića 38-40, New Belgrade, 11070, Serbia | ||
Vodafone Enterprise Equipment Limited Ogranak u Beogradu - Serbia Branch2 | | Branch |
Singapore | ||
Asia Square Tower 2, 12 Marina View, #17-01, 018961, Singapore | ||
Vodafone Enterprise Singapore Pte.Ltd | | Ordinary shares |
Slovakia | ||
Prievozská 6, Bratislava, 821 09, Slovakia | ||
Vodafone Czech Republic A.S. – Slovakia Branch2 | | Branch |
Suché mýto 1, Bratislava, 811 03, Slovakia | ||
Vodafone Global Network Limited – Slovakia Branch2 | | Branch |
South Africa | ||
319 Frere Road, Glenwood, 4001, South Africa | ||
Cable and Wireless Worldwide South Africa (Pty) Ltd | | Ordinary shares |
9 Kinross Street, Germiston South, 1401, South Africa | ||
Vodafone Holdings (SA) Proprietary Limited | | Ordinary shares |
Vodafone Investments (SA) Proprietary Limited | | Ordinary A shares, “B” Ordinary no par value shares |
Bylsbridge Office Park, Building 14m Block C, 1st Floor, Alexandra Road, Centurion,Highveld Ext 73, 0046, South Africa | ||
10T Holdings (Proprietary) Limited5 | Ordinary shares | |
IoT.nxt (Pty) Limited5 | Ordinary shares | |
IOT.nxt Development (Pty) Limited5 | Ordinary shares | |
Vodacom Corporate Park, 082 Vodacom Boulevard, Midrand, 1685, South Africa | ||
GS Telecom (Pty) Limited5 | | Ordinary shares |
Infinity Services Partner Company5 | | Ordinary shares |
Jupicol (Proprietary) Limited5 | | Ordinary shares |
Mezzanine Ware (RF) Proprietary Limited5 | | Ordinary shares |
Motifprops 1 (Proprietary) Limited5 | | Ordinary shares |
Scarlet Ibis Investments 23 (Pty) Limited5 | | Ordinary shares |
Storage Technology Services (Pty) Limited5 | | Ordinary shares |
Vodacom (Pty) Limited5 | | Ordinary shares, Ordinary A shares |
Vodacom Business Africa Group (Pty) Limited5 | | Ordinary shares |
Vodacom Financial Services (Proprietary) Limited5 | | Ordinary shares |
Vodacom Group Limited | | Ordinary shares |
Vodacom Insurance Administration Company (Proprietary) Limited5 | | Ordinary shares |
Vodacom Insurance Company (RF) Limited5 | | Ordinary shares |
Vodacom International Holdings (Pty) Limited5 | | Ordinary shares |
Vodacom Life Assurance Company (RF) Limited5 | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |||
Vodacom Payment Services (Proprietary) Limited5 | | Ordinary shares |
Vodacom Properties No 1 (Proprietary) Limited5 | | Ordinary shares |
Vodacom Properties No.2 (Pty) Limited5 | | Ordinary shares |
Wheatfields Investments 276 (Proprietary) Limited5 | | Ordinary shares |
XLink Communications (Proprietary) Limited5 | | Ordinary A Shares |
Spain | ||
Antracita, 7 – 28045, Madrid , Spain | ||
Vodafone Automotive Iberia S.L. | | Ordinary shares |
Avenida de América 115, 28042, Madrid, Spain | ||
Vodafone Enabler España, S.L. | | Ordinary shares |
Vodafone Energía, S.L. | | Ordinary shares |
Vodafone Enterprise Spain SLU | | Ordinary shares, Ordinary euro shares |
Vodafone España S.A.U. | | Ordinary shares |
Vodafone Holdings Europe S.L.U. | | Ordinary shares |
Vodafone ONO, S.A.U. | | Ordinary shares |
Vodafone Servicios S.L.U. | | Ordinary shares |
Calle San Severo 22, 28042, Madrid, Spain | ||
Vantage Towers, S.L.U. 4 | | Ordinary shares |
Torre Norte Adif, Explanada de la Estación no 7, 29002, Málaga, Spain | ||
Vodafone Intelligent Solutions España, S.L.U. | | Ordinary shares |
Sweden | ||
c/o Hellström advokatbyrå, Box 7305, 103 90, Stockholm, Sweden | ||
Vodafone Enterprise Sweden AB | | Ordinary shares, Shareholder’s contribution shares |
Switzerland | ||
Schiffbaustrasse 2, 8005, Zurich, Switzerland | ||
Vodafone Enterprise Switzerland AG | | Ordinary shares |
Taiwan | ||
22F., No.100, Songren Road., Xinyi District, Taipei City, 11070, Taiwan | ||
Vodafone Global Enterprise Taiwan Limited | | Ordinary shares |
Tanzania, United Republic of | ||
15 Floor, Vodacom Tower, Ursino Estate, Plot No. 23, Bagamoyo Road, Dar es Salaam, Tanzania, United Republic of | ||
M-Pesa Limited5 | | Ordinary A shares, Ordinary B shares |
Shared Networks Tanzania Limited5 | | Ordinary shares |
Vodacom Tanzania Public Limited Company5 | | Ordinary shares |
3rd Floor, Maktaba (Library), ComplexBibi, Titi Mohaned Road, Dar es Salaam, Tanzania, United Republic of | ||
Gateway Communications Tanzania Limited (in liquidation)5 | | Ordinary shares |
Turkey | ||
Büyükdere Caddesi, No: 251, Maslak, Şişli / İstanbul, 34398, Turkey | ||
Vodafone Bilgi Ve Iletisim Hizmetleri AS | | Registered shares |
Vodafone Dagitim, Servis ve Icerik Hizmetleri A.S. | | Ordinary shares |
Vodafone Dijital Yayincilik Hizmetleri A.S. | | Ordinary shares |
Vodafone Holding A.S. | | Registered shares |
Vodafone Kule ve Altyapi Hizmetleri A.S. | | Ordinary shares |
Vodafone Mall Ve Electronik Hizmetler Ticaret AS | | Ordinary shares |
Vodafone Medya Icerik Hizmetleri A.S. | | Ordinary shares |
Vodafone Net İletişim Hizmetleri A.S. | | Ordinary shares |
Vodafone Telekomunikasyon A.S. | | Registered shares |
İTÜ Ayazağa Kampüsü, Koru Yolu, Arı Teknokent Arı 3 Binası, Maslak, İstanbul, 586553, Turkey | ||
Vodafone Teknoloji Hizmetleri A.S. | | Registered shares |
Maslak Mah. AOS 55 Sk. 42 Maslak Sit. B Blok Apt. No: 4/663, Sarıyer Istanbul, Turkey | ||
Vodafone Sigorta Aracilik Hismetleri A.S. | | Ordinary shares |
Maslak Mah.AOS 55. Sok. 42 Maslak B BLOK Sit.No: 4 / 665, | ||
Vodafone Elektronik Para Ve Ödeme Hizmetleri A.S. | | Registered shares |
Maslak Mah. AOS 55.Sokak 42 Maslak Sitesi No:4 Kat 18, Ic Kapi: 664 Sarıyer Istanbul, Turkey | ||
Vodafone Finansman A.S. | | Ordinary shares |
Ukraine | ||
Bohdana Khmelnytskogo Str. 19-21, Kyiv, Ukraine | ||
LLC Vodafone Enterprise Ukraine | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |
% of share class | ||
held by Group | ||
Company name | Companies | Share class |
United Arab Emirates | ||
16-SD 129,Ground Floor, Building 16-Co Work,Dubai Internet | ||
Vodacom Fintech Services FZ-LLC5 | | Ordinary shares |
Office 101, 1st Floor, DIC Building 1, Dubai Internet City, Dubai, United Arab Emirates | ||
Vodafone Enterprise Europe (UK) Limited – Dubai Branch2 | | Branch |
United Kingdom | ||
1-2 Berkeley Square, 99 Berkeley Street, Glasgow, G3 7HR, Scotland | ||
Thus Group Holdings Limited | | Ordinary shares |
Thus Group Limited | | Ordinary shares |
Thus Profit Sharing Trustees Limited | | Ordinary shares |
11 Staple Inn, London,WC1V 7QH,United Kingdom | ||
Vodacom Business Africa Group Services | | Ordinary shares, Preference shares |
Vodacom Investments Company Proprietary Limited5 | | Ordinary shares |
Vodacom UK Limited5 | | Ordinary shares, Non-redeemable ordinary A shares, Ordinary B shares, Non-redeemable preference shares |
784 Upper Newtownards Road, Belfast, BT16 1UD, United Kingdom | ||
Vodafone (NI) Limited | | Ordinary shares |
Edinburgh House, 4 North St. Andrew Street, Edinburgh, EH2 1HJ, United Kingdom | ||
Pinnacle Cellular Group Limited | | Ordinary shares |
Pinnacle Cellular Limited | | Ordinary shares |
Vodafone (Scotland) Limited | | Ordinary shares |
Quarry Corner, Dundonald, Belfast, BT16 1UD, Northern Ireland | ||
Energis (Ireland) Limited | | A Ordinary shares, B Ordinary shares, C Ordinary shares, D Ordinary |
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, United Kingdom | ||
Apollo Submarine Cable System | | Ordinary shares |
Bluefish Communications Limited | | Ordinary A shares, Ordinary B shares, Ordinary C shares, Ordinary D shares |
Cable Wireless Aspac Holdings Limited | | Ordinary shares |
Cable Wireless CIS Services Limited | | Ordinary shares |
Cable Wireless Communications Data Network Services Limited | | 'A' Ordinary shares, 'B' Ordinary shares |
Cable Wireless Europe Holdings Limited | | Ordinary shares |
Cable Wireless Global Business Services Limited | | Ordinary shares |
Cable Wireless Global Holding Limited | | Ordinary shares |
Cable Wireless Global Telecommunication Services Limited | | Ordinary shares |
Cable Wireless UK Holdings Limited | | Ordinary shares |
Cable Wireless Worldwide Limited | | Ordinary shares, Redeemable preference shares |
Cable Wireless Worldwide Voice Messaging Limited | | Ordinary shares |
Cable and Wireless (India) Limited | | Ordinary shares |
Cable and Wireless Nominee Limited | | Ordinary shares |
Central Communications Group Limited | | Ordinary shares, Ordinary A shares |
Energis Communications Limited | | Ordinary shares |
Energis Squared Limited | | Ordinary shares |
General Mobile Corporation | | Ordinary shares |
London Hydraulic Power Company (The) | | Ordinary shares, |
MetroHoldings Limited | | Ordinary shares |
ML Integration Group Limited | | Ordinary shares |
Navtrak Limited | | Ordinary shares |
Project Telecom Holdings Limited1 | | Ordinary shares |
Rian Mobile Limited | | Ordinary shares |
Talkland International Limited (in | | Ordinary shares |
Talkmobile Limited | | Ordinary shares |
The Eastern Leasing Company Limited | | Ordinary shares |
Thus Limited | | Ordinary shares |
Vizzavi Limited | | Ordinary shares |
Voda Limited | | Ordinary shares |
Vodafone (New Zealand) Hedging Limited | | Ordinary shares |
Vodafone 2. | | Ordinary shares |
Vodafone 4 UK | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |||
Vodafone 5 Limited | | Ordinary shares |
Vodafone 5 UK | | Ordinary shares |
Vodafone 6 UK | | Ordinary shares |
Vodafone Americas 4 | | Ordinary shares |
Vodafone Automotive UK Limited | | Ordinary shares |
Vodafone Benelux Limited | | Ordinary shares, Preference shares |
Vodafone Cellular Limited1 | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |
% of share class | ||
held by Group | ||
Company name | Companies | Share class |
Vodafone Consolidated Holdings Limited | | Ordinary shares |
Vodafone Corporate Limited | | Ordinary shares |
Vodafone Corporate Secretaries Limited1 | | Ordinary shares |
Vodafone DC Pension Trustee Company Limited1 | | Ordinary shares |
Vodafone Distribution Holdings Limited | | Ordinary shares |
Vodafone Enterprise Corporate Secretaries Limited | | Ordinary shares |
Vodafone Enterprise Equipment Limited | | Ordinary shares |
Vodafone Enterprise Europe (UK) Limited | | Ordinary shares |
Vodafone Enterprise U.K. | | Ordinary shares |
Vodafone Euro Hedging Limited | | Ordinary shares |
Vodafone Euro Hedging Two | | Ordinary shares |
Vodafone Europe UK | | Ordinary shares |
Vodafone European Investments1 | | Ordinary shares |
Vodafone European Portal Limited1 | | Ordinary shares |
Vodafone Finance Limited 1 | | Ordinary shares |
Vodafone Finance Luxembourg Limited | | Ordinary shares |
Vodafone Finance Sweden | | Ordinary shares, Ordinary deferred |
Vodafone Finance UK Limited | | Ordinary shares |
Vodafone Financial Operations | | Ordinary shares |
Vodafone Global Content Services Limited | | Ordinary shares, 5% fixed rate non-voting preference shares |
Vodafone Global Enterprise Limited | | Ordinary shares, Deferred shares, B deferred shares |
Vodafone Group (Directors) Trustee Limited1 | | Ordinary shares |
Vodafone Group Pension Trustee Limited1 | | Ordinary shares |
Vodafone Group Services Limited | | Ordinary shares, Deferred shares |
Vodafone Group Services No.2 Limited1 | | Ordinary shares |
Vodafone Group Share Trustee Limited1 | | Ordinary shares |
Vodafone Holdings Luxembourg Limited | | Ordinary shares |
Vodafone Intermediate Enterprises Limited | | Ordinary shares |
Vodafone International 2 Limited – UK Branch2 | | Branch |
Vodafone International Holdings Limited | | Ordinary shares |
Vodafone International Operations Limited | | Ordinary shares |
Vodafone Investment UK | | Ordinary shares |
Vodafone Investments Australia Limited | | Ordinary shares |
Vodafone Investments Limited1 | | Ordinary shares, Zero coupon redeemable preference shares |
Vodafone IP Licensing Limited1 | | Ordinary shares |
Vodafone Limited | | Ordinary shares |
Vodafone Marketing UK | | Ordinary shares |
Vodafone Mobile Communications Limited | | Ordinary shares |
Vodafone Mobile Enterprises Limited | | A-ordinary shares, Ordinary one pound shares |
Vodafone Mobile Network Limited | | A-ordinary shares, Ordinary one pound shares |
Vodafone Nominees Limited1 | | Ordinary shares |
Vodafone Oceania Limited | | Ordinary shares |
Vodafone Old Show Ground Site Management Limited | | Ordinary shares |
Vodafone Overseas Finance Limited | | Ordinary shares |
Vodafone Overseas Holdings Limited | | Ordinary shares |
Vodafone Panafon UK | | Ordinary shares |
Vodafone Partner Services Limited | | Ordinary shares, Redeemable preference shares |
Vodafone Property Investments Limited | | Ordinary shares |
Vodafone Retail (Holdings) Limited | | Ordinary shares |
Vodafone Sales Services Limited | | Ordinary shares |
Vodafone UK Foundation | | Sole member |
Vodafone UK Limited1 | | Ordinary shares |
Vodafone Ventures Limited1 | | Ordinary shares |
Vodafone Worldwide Holdings Limited | | Ordinary shares; Cumulative preference |
Vodafone Yen Finance Limited | | Ordinary shares |
Vodafone-Central Limited | | Ordinary shares |
Vodaphone Limited | | Ordinary shares |
Vodata Limited | | Ordinary shares |
Your Communications Group Limited | | B Ordinary shares, Redeemable preference shares |
United States |
Notes to the consolidated financial statements (continued) | |||
1209 Orange, Orange Street,Wilmington,New Castle DE | ||
IoT nxt USA Inc5 | | Common stock |
145 West 45th St., 8th Floor, New York NY 10036, United States | ||
Cable Wireless Americas | | Common stock shares |
Vodafone Americas Virginia Inc. | | Common stock shares |
Vodafone US Inc. | | Common stock shares |
1615 Platte Street, Suite 02-115, Denver CO 80202, United States | ||
Vodafone Americas Foundation | | Trustee |
2711 Centerville Road, Suite 400, Wilmington, Delaware 19808, United States | ||
Unitymedia Finance LLC | | Sole member |
Notes to the consolidated financial statements (continued) | |
Associated undertakings and joint arrangements
Company Name | % of share | Share Class |
Australia | ||
Ground Floor, 55 Clarence Street, Sydney NSW 2000, Australia | ||
FTTB Wholesale Pty Ltd | | Ordinary shares |
Level 1, 177 Pacific Highway, North Sydney NSW 2060, Australia | ||
3.6 GHz Spectrum Pty Ltd | | Ordinary shares |
AAPT Limited | | Ordinary shares |
ACN 088 889 230 Pty Ltd | | Ordinary shares |
ACN 139 798 404 Pty Ltd | | Ordinary shares |
Adam Internet Holdings Pty Ltd | | Ordinary shares |
Adam Internet Pty Ltd | | A shares, B shares, Ordinary shares |
Agile Pty Ltd | | Ordinary shares |
AlchemyIT Pty Ltd | | Ordinary shares |
Blue Call Pty Ltd | | Ordinary shares |
Cable Licence Holdings Pty Ltd | | A shares, B shares |
Chariot Pty Ltd | | Ordinary shares |
Chime Communications Pty Ltd | | Ordinary shares |
Connect Internet Solutions Pty Limited | | Ordinary shares |
Connect West Pty Ltd | | No 1 Ordinary shares |
Destra Communications Pty Ltd | | Ordinary shares |
Digiplus Contracts Pty Ltd | | Ordinary shares |
Digiplus Holdings Pty Ltd | | Ordinary shares |
Digiplus Investments Pty Ltd | | Ordinary shares |
Digiplus Pty Ltd | | Ordinary shares |
H3GA Properties (No.3) Pty Limited | | Ordinary shares |
Hosteddesktop.com Pty Ltd | | Ordinary shares |
iHug Pty Ltd | | No 1 Ordinary shares |
iiNet (Ozemail) Pty Ltd | | Ordinary shares |
iiNet Labs Pty Ltd | | Ordinary shares |
iiNet Limited | | Ordinary shares |
Internode Pty Ltd | | B shares, Ordinary shares |
IntraPower Pty Limited | | Ordinary shares |
Intrapower Terrestrial Pty Ltd | | Ordinary shares |
IP Group Pty Ltd | | Ordinary shares |
IP Services Xchange Pty Ltd | | A shares, B shares |
Jiva Pty Ltd | | Ordinary shares |
Kooee Communications Pty Ltd | | Ordinary shares |
Kooee Mobile Pty Ltd | | Ordinary shares |
Kooee Pty Ltd | | A shares, B shares |
Mercury Connect Pty Ltd | | E shares, Ordinary shares |
Mobile JV Pty Limited | | Ordinary shares |
Mobileworld Communications Pty Limited | | Ordinary shares |
Mobileworld Operating Pty Ltd | | Ordinary shares |
Netspace Online Systems Pty Ltd | | Ordinary shares |
Numillar IPS Pty Ltd | | Ordinary shares |
Orchid Human Resources Pty Ltd | | Ordinary shares |
PIPE International (Australia) Pty Ltd | | Ordinary shares |
PIPE Networks Pty Limited | | Ordinary shares |
PIPE Transmission Pty Limited | | Ordinary shares |
PowerTel Limited | | Ordinary shares |
Request Broadband Pty Ltd | | Ordinary shares |
Soul Communications Pty Ltd | | Ordinary shares |
Soul Contracts Pty Ltd | | Ordinary shares |
Soul Pattinson Telecommunications Pty Ltd | | Ordinary shares |
SPT Telecommunications Pty Ltd | | Ordinary shares |
SPTCom Pty Ltd | | Ordinary shares |
Telecom Enterprises Australia Pty Limited | | Ordinary shares |
Telecom New Zealand Australia Pty Ltd | | Ordinary shares, Redeemable preference shares |
TPG Corporation Limited | | Ordinary shares |
TPG Energy Pty Ltd | | Ordinary shares |
TPG Finance Pty Limited | | Ordinary shares |
TPG Holdings Pty Ltd | | Ordinary shares |
TPG Internet Pty Ltd | | Ordinary shares |
TPG JV Company Pty Ltd | | Ordinary shares |
TPG Network Pty Ltd | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |||
TPG Telecom Limited | | Ordinary shares |
TransACT Broadcasting Pty Ltd | | Ordinary shares |
TransACT Capital Communications Pty Ltd | | Ordinary shares |
TransACT Communications Pty Ltd | | Ordinary shares |
TransACT Victoria Communications Pty Ltd | | Ordinary shares |
TransACT Victoria Holdings Pty Ltd | | Ordinary shares |
Transflicks Pty Ltd | | Ordinary shares |
Trusted Cloud Pty Ltd | | Ordinary shares |
Trusted Cloud Solutions Pty Ltd | | Ordinary shares |
Value Added Network Pty Ltd | | Ordinary shares |
Virtual Desktop Pty Ltd | | Ordinary shares |
Vodafone Australia Pty Limited | | Ordinary shares, Class B shares, Redeemable preference shares |
Vodafone Foundation Australia Pty Limited | | Ordinary shares |
Vodafone Hutchison Receivables Pty Limited | | Ordinary shares |
Vodafone Hutchison Spectrum Pty Limited | | Ordinary shares |
Vodafone Network Pty Limited | | Ordinary shares |
Vodafone Pty Limited | | Ordinary shares |
VtalkVoip Pty Ltd | | Ordinary shares |
Westnet Pty Ltd | | Ordinary shares |
Bermuda | ||
Clarendon House, 2 Church St, Hamilton, HM11, Bermuda | ||
PPC 1 Limited | | Ordinary shares |
Czech Republic | ||
U Rajské zahrady 1912/3, Praha 3, 130 00, Czech Republic | ||
COOP Mobil s.r.o. | | Ordinary shares |
Egypt | ||
23 Kasr El Nil St, Cairo, 11211, Egypt | ||
Wataneya Telecommunications S.A.E | | Ordinary shares |
Ethiopia | ||
Kirkos Sub-City, Woreda 01, House No. New, (Safaricom HQ), Addis Ababa, Ethiopia | ||
Safaricom Telecommunications Ethiopia Private Limited Company 5 | | Ordinary shares |
Germany | ||
38 Berliner Allee, 40212, Düsseldorf, Germany | ||
MNP Deutschland Gesellschaft | | Partnership share |
Nobelstrasse 55, 18059, Rostock, Germany | ||
Verwaltung “Urbana Teleunion” Rostock GmbH3 | | Ordinary shares |
Greece | ||
43–45 Valtetsiou Str., Athens, Greece | ||
Safenet N.P,A. | | Ordinary shares |
56 Kifisias Avenue Delfwn , Marousi, 151 25, Greece | ||
Tilegnous IKE | | Ordinary shares |
Marathonos Ave 18 km Pylou, Pallini, Attica, 15351, Greece | ||
Victus Networks S.A. | | Ordinary shares |
India | ||
10th Floor, Birla Centurion, Century Mills Compound, Pandurang Budhkar Marg, Worli, Mumbai, Maharashtra, 400030, India | ||
Vodafone Foundation7 | | Equity shares |
Vodafone Idea Shared Services Limited7 | | Equity shares |
Vodafone Idea Technology Solutions Limited7 | | Equity shares |
Vodafone m-pesa Limited7 | | Equity shares |
You Broadband India Limited7 | | Equity shares |
A-19, Mohan Co-operative Industrial Estate, Mathura Road, New Delhi, Delhi, 110044, India | ||
FireFly Networks Limited7 | | Equity shares |
A4, Aditya Birla Centre, S.K. Ahire Marg, Worli, Mumbai, Maharashtra, 400030, India | ||
Aditya Birla Idea Payments Bank Limited (in liquidation)7 | | Equity shares |
Building No.10, Tower-A, 4th Floor,DLF Cyber City,Gurugram, | ||
Indus Towers Limited | | Ordinary shares |
Suman Tower Plot No. 18, Sector No. 11, Gandhinagar, 382011, Gujarat, India | ||
Vodafone Idea Limited | | Equity shares |
Vodafone Idea Manpower Services Limited7 | | Equity shares |
Vodafone House, Corporate Road, Prahladnagar, Off S. G. Highway, Ahmedabad, Gujarat, 380051, India | ||
Connect (India) Mobile Technologies Private Limited7 | | Equity shares |
Vodafone Idea Business Services Limited7 | | Equity shares |
Vodafone Idea Communication Systems Limited7 | | Equity shares |
Vodafone Idea Telecom Infrastructure Limited7 | | Equity shares |
Ireland |
Notes to the consolidated financial statements (continued) | |
The Herbert Building, The Park, Carrickmines, Dublin, Ireland | ||
Siro DAC | | Ordinary shares |
Siro JV Holdco Limited | | Ordinary B shares |
Italy | ||
Via Gaetana Negri 1, 20123, Milano, Italy | ||
Infrastrutture Wireless Italiane S.p.A4 | | Ordinary shares |
Kenya | ||
LR No. 13263, Safaricom House, Waiyaki Way, PO Box 66827-00800, Nairobi, Kenya | ||
Safaricom PLC6 | | Ordinary shares |
Safaricom House, Waiyaki Way Westlands, Nairobi, Kenya | ||
M-PESA Africa Limited5 | | Ordinary shares |
Luxembourg | ||
15 rue Edward Steichen, Luxembourg, 2540, Luxembourg | ||
Tomorrow Street SCA | | Ordinary A shares, Ordinary B shares, Ordinary C shares |
Netherlands | ||
3 More London Riverside, London, SE1 2AQ, United Kingdom | ||
Global Partnership for Ethiopia B.V.5 | | Ordinary shares |
Avenue Ceramique 300, 6221 Kx, Maastricht, Netherlands | ||
Vodafone Libertel B.V. | | Ordinary shares |
Boven Vredenburgpassage 128, 3511 WR, Utrecht, Netherlands | ||
Amsterdamse Beheer- en Consultingmaatschappij B.V. | | Ordinary shares |
Esprit Telecom B.V. | | Ordinary shares |
FinCo Partner 1 B.V. | | Ordinary shares |
LGE HoldCo V B.V. | | Ordinary shares |
LGE HoldCo VI B.V. | | Ordinary shares |
LGE Holdco VII B.V. | | Ordinary shares |
LGE HoldCo VIII B.V. | | Ordinary shares |
Vodafone Financial Services B.V. | | Ordinary shares |
Vodafone Nederland Holding I B.V. | | Ordinary shares |
Vodafone Nederland Holding II B.V. | | Ordinary shares |
VodafoneZiggo Employment B.V. | | Ordinary shares |
VodafoneZiggo Group B.V. | | Ordinary shares |
VodafoneZiggo Group Holding B.V. | | Ordinary shares |
VZ Financing I B.V. | | Ordinary shares |
VZ Financing II B.V. | | Ordinary shares |
VZ FinCo B.V. | | Ordinary shares |
VZ PropCo B.V. | | Ordinary shares |
VZ Secured Financing B.V. | | Ordinary shares |
XB Facilities B.V. | | Ordinary shares |
Ziggo B.V. | | Ordinary shares |
Ziggo Deelnemingen B.V. | | Ordinary shares |
Ziggo Finance 2 B.V. | | Ordinary shares |
Ziggo Netwerk II B.V. | | Ordinary shares |
Ziggo Real Estate B.V. | | Ordinary shares |
Ziggo Services B.V. | | Ordinary shares |
Ziggo Services Employment B.V. | | Ordinary shares |
Ziggo Services Netwerk 2 B.V. | | Ordinary shares |
Ziggo Zakelijk Services B.V. | | Ordinary shares |
Zoranet Connectivity Services B.V. | | Ordinary shares |
ZUM B.V. | | Ordinary shares |
Media Parkboulevard 2, 1217 WE Hilversum, Netherlands | ||
Liberty Global Content Netherlands B.V. | | Ordinary shares |
Winschoterdiep 60, 9723 AB Groningen, Netherlands | ||
Zesko B.V. | | Ordinary shares |
Ziggo Bond Company B.V. | | Ordinary shares |
Ziggo Netwerk B.V. | | Ordinary shares |
New Zealand | ||
Tompkins Wake, Level 11, 41 Shortland Street, Auckland 1010, New Zealand | ||
iiNet (New Zealand) AKL Limited | | Ordinary shares |
Unit 17, 24 Allright Place, Mt Wellington, Auckland, New Zealand | ||
TPG (NZ) Pty Ltd | | Ordinary shares |
Philippines | ||
22F Robinson Equitable Tower, ADB Ave, Corner Povega St, Ortigas Center, Pasig City, Philippines | ||
Orchid Cybertech Services Inc | | Ordinary shares |
Portugal | ||
Espaço Sete Rios, LEAP Rua de Campolide, 351, 0.05 , 1070-034, Lisboa, Portugal | ||
Dualgrid – Gestão de Redes Partilhadas, S.A. | | Ordinary shares |
Notes to the consolidated financial statements (continued) | |||
Rua Pedro e Inês, Lote 2.08.01, 1990-075, Parque das Nações, Lisboa, Portugal | ||
Sport TV Portugal, S.A. | | Nominative shares |
Romania | ||
Floor 3, Module 2, Connected Buildings III, Nr. 10A, Dimitrie Pompei Boulevard, Bucharest, Sector 2, Romania | ||
Netgrid Telecom SRL | | Ordinary shares |
Russian Federation | ||
Building 3, 11, Promyshlennaya Street, Moscow 115 516 | ||
Autoconnex Limited | | Ordinary shares |
South Africa | ||
76 Maude Street, Sandton, Johannesberg, 2196, South Africa | ||
Waterberg Lodge (Proprietary) Limited5 | | Ordinary shares |
Building 13,Ground Floor, East Thornhill Office Park, 94 Bekker | ||
Number Portability Company (Pty) Ltd5 | | Ordinary shares |
Rigel Park, Block A, 446 Rigel Avenue, Erasmusrand, Pretoria, 0181, South Africa | ||
Canard Spatial Technologies(Pty) Ltd5 | | Ordinary shares |
AfriGis(Pty) Ltd5 | | Ordinary shares |
Vodacom Corporate Park, 082 Vodacom Boulevard, Midrand, 1685, South Africa | ||
M-Pesa S.A (Proprietary) Limited5 | | Ordinary shares |
Tanzania, United Republic of | ||
Plot No. 23, Ursino Estate, Bagamoyo Road, Dar es Salaam, Tanzania, United Republic of | ||
Vodacom Trust Limited (in liquidation)5 | | Ordinary A shares, Ordinary B shares |
Turkey | ||
Çifte Havuzlar Mah Eski Londra Asfaltı Cad No: 151/1E/301, Esenler, Istanbul, Turkey | ||
FGS Bilgi Islem Urunler Sanayi ve Ticaret AS | | Ordinary shares |
United Kingdom | ||
24/25 The Shard, 32 London Bridge Street, London, SE1 9SG, United Kingdom | ||
Digital Mobile Spectrum Limited | | Ordinary shares |
3 More London Riverside, London, SE1 2AQ,United Kingdom | ||
VodaFamily Ethiopia Holding Company Limited5 | | Ordinary shares |
Griffin House, 161 Hammersmith Road, London, W6 8BS, United Kingdom | ||
Cable Wireless Trade Mark Management Limited | | Ordinary A shares, Ordinary B shares |
Hive 2, 1530 Arlington Business Park, Theale, Reading, Berkshire, RG7 4SA, United Kingdom | ||
Cornerstone Telecommunications Infrastructure Limited4 | | Ordinary shares |
Vodafone House, The Connection, Newbury, Berkshire, RG14 2FN, United Kingdom | ||
Vodafone Hutchison (Australia) Holdings Limited | | Ordinary shares |
United States | ||
251 Little Falls Drive, Wilmington DE 19808, United States | ||
LG Financing Partnership | | Partnership interest |
PPC 1 (US) Inc. | | Ordinary shares |
Ziggo Financing Partnership | | Partnership interest |
Notes:
| 1 | Directly held by Vodafone Group Plc. |
| 2 | Branches. |
| 3 | Shareholding is indirect through Vodafone Deutschland GmbH. |
| 4 | Shareholding is indirect through Vantage Towers A.G. |
| 5 | Shareholding is indirect through Vodacom Group Limited. The indirect shareholding is calculated using the |
| 6 | At 31 March 2022 the fair value of Safaricom Plc was KES |
| 7 | Includes the indirect interest held through Vodafone Idea Limited. |
Notes to the consolidated financial statements (continued) | |
Selected financial information
The table below shows selected financial information in respect of subsidiaries that have non-controlling interests that are material to the Group1.
Vodafone Egypt | Vantage Towers | |||||||||
Vodacom Group Limited | Telecommunications S.A.E | A.G. | ||||||||
2022 | 2021 | 2022 | 2021 | 2022 | ||||||
€m | €m | €m | €m | €m | ||||||
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Note:
1 | Vantage Towers A.G. was listed on the Frankfurt Stock exchange on 18 March 2021, resulting in the recognition of non-controlling interests of € |
Notes to the consolidated financial statements (continued) | |||
32. Subsidiaries exempt from audit
The following UK subsidiaries will take advantage of the audit exemption set out within section 479A of the Companies Act 2006 for the year ended 31 March 2022.
Name | Registration number | Name | Registration number |
| |||
Bluefish Communications Limited | 5142610 | Vodafone Enterprise Europe (UK) Limited | 3137479 | ||||
Cable Wireless Aspac Holdings Limited | 4705342 | Vodafone Euro Hedging Limited | 3954207 | ||||
Cable Wireless CIS Services Limited | 2964774 | Vodafone Euro Hedging Two | 4055111 | ||||
Cable Wireless Europe Holdings Limited | 4659719 | Vodafone Europe UK | 5798451 | ||||
Cable Wireless Global Business Services Limited | 3537591 | Vodafone European Investments | 3961908 | ||||
Cable Wireless Global Holding Limited | 3740694 | Vodafone European Portal Limited | 3973442 | ||||
Cable Wireless UK Holdings Limited | 3840888 | Vodafone Finance Luxembourg Limited | 5754479 | ||||
Cable Wireless Worldwide Limited | 7029206 | Vodafone Finance Sweden | 2139168 | ||||
Cable Wireless Worldwide Voice Messaging | 1981417 | Vodafone Finance UK Limited | 3922620 | ||||
Limited | Vodafone Financial Operations | 4016558 | |||||
Cable Wireless Nominee Limited | 3249884 | Vodafone Global Content Services Limited | 4064873 | ||||
Energis (Ireland) Limited | NI035793 | Vodafone Holdings Luxembourg Limited | 4200970 | ||||
Energis Communications Limited | 2630471 | Vodafone Intermediate Enterprises Limited | 3869137 | ||||
Energis Squared Limited | 3037442 | Vodafone International Holdings Limited | 2797426 | ||||
General Mobile Corporation Limited | 2585763 | Vodafone International Operations Limited | 2797438 | ||||
London Hydraulic Power Company (The) | ZC000055 | Vodafone Investment UK | 5798385 | ||||
MetroHoldings Limited | 3511122 | Vodafone Investments Limited | 1530514 | ||||
ML Integration Group Limited | 3252903 | Vodafone IP Licensing Limited | 6846238 | ||||
Talkland International Limited | 2354106 | Vodafone Marketing UK | 6858585 | ||||
The Eastern Leasing Company Limited | 1672832 | Vodafone Mobile Communications Limited | 3942221 | ||||
Thus Group Holdings Limited | SC192666 | Vodafone Mobile Enterprises Limited | 3961390 | ||||
Thus Group Limited | SC226738 | Vodafone Mobile Network Limited | 3961482 | ||||
Voda Limited | 1847509 | Vodafone Nominees Limited | 1172051 | ||||
Vodafone 2. | 4083193 | Vodafone Oceania Limited | 3973427 | ||||
Vodafone 4 UK | 6357658 | Vodafone Overseas Finance Limited | 4171115 | ||||
Vodafone 5 Limited | 6688527 | Vodafone Overseas Holdings Limited | 2809758 | ||||
Vodafone 5 UK | 2960479 | Vodafone Panafon UK | 6326918 | ||||
Vodafone 6 UK | 8809444 | Vodafone Property Investments Limited | 3903420 | ||||
Vodafone Americas 4 | 6389457 | Vodafone UK Limited | 2227940 | ||||
Vodafone Benelux Limited | 4200960 | Vodafone Worldwide Holdings Limited | 3294074 | ||||
Vodafone Cellular Limited | 896318 | Vodafone Yen Finance Limited | 4373166 | ||||
Vodafone Consolidated Holdings Limited | 5754561 | Vodaphone Limited | 2373469 | ||||
Vodafone Corporate Secretaries Limited | 2357692 | Vodata Limited | 2502373 | ||||
Vodafone Enterprise Corporate Secretaries Limited | 2303594 | Your Communications Group Limited | 4171876 | ||||
Vodafone Enterprise Equipment Limited | 1648524 |
Index of Exhibits to the Company’s Annual Report on Form 20-F for the financial year ended March 31, 2022
1.1 | Articles of Association of the Company, as adopted on July 27, 2021. |
2.1 | |
2.2 | |
2.3 | |
2.4 | |
2.5 | |
2.6 | |
2.7 | Description of Securities Registered under Section 12 of the Exchange Act. |
4.1 | |
4.2 | |
4.3 | |
4.4 | |
4.5 | |
4.6 |
4.7 | |
4.8 | |
4.9 | |
4.10 | |
4.11 | |
4.12 | |
4.13 | |
4.14 | |
4.15 | |
4.16 | |
4.17 | Letter of Appointment of Olaf Klaus Meijer Swantee dated 10 March 2021 |
4.18 | Letter of Appointment of Jean-François van Boxmeer dated 21 May 2020. |
4.19 | Letter of Appointment of Deborah Kerr dated 28 September 2021. |
4.20 | |
4.21 | Letter of Appointment of Delphine Ernotte Cunci dated 18 May 2022. |
4.22 | |
4.23 | |
4.24 | |
4.25 |
4.26 | |
4.27 | |
4.28 | |
8. | |
12. | |
13. | |
15.1 | |
99.1 | |
101.INS | Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document |
101.SCH | Inline XBRL Taxonomy Extension Schema |
101.CAL | Inline XBRL Taxonomy Extension Schema Calculation Linkbase |
101.DEF | Inline XBRL Taxonomy Extension Schema Definition Linkbase |
101.LAB | Inline XBRL Taxonomy Extension Schema Label Linkbase |
101.PRE | Inline XBRL Taxonomy Extension Schema Presentation Linkbase |
104 | Cover Page Interactive Date File (formatted as Inline XBRL and contained in Exhibit 101) |
* The schedules to the Sale and Purchase Agreement have been omitted from this filing pursuant to Item 601(b)(2) of Regulation S-K. Copies of such schedules will be furnished to the SEC upon its request; provided, however, that confidential treatment may be requested pursuant to Rule 24b-2 of the Exchange Act for any schedule so furnished.
** The schedules to the Transitional Services Agreement have been omitted from this filing. Copies of such schedules will be furnished to the SEC upon its request; provided, however, that confidential treatment may be requested pursuant to Rule 24b-2 of the Exchange Act for any schedule so furnished. Certain identified confidential information in this exhibit has been omitted because such identified confidential information (i) is not material and (ii) is the type that the registrant treats as private or confidential.
***Certain identified confidential information in this exhibit has been omitted because such identified confidential information (i) is not material and (ii) is the type that the registrant treats as private or confidential.
Page 3 of 3
Signature
The registrant hereby certifies that it meets all of the requirements for filing on Form 20-F and that it has duly caused and authorised the undersigned to sign this Annual Report on its behalf.
Vodafone Group Plc | |
Registrant | |
/s/ R E S Martin | |
Rosemary Martin | |
Group General Counsel and Company Secretary | |
Date: 16 June 2022 | |