Assignment Overview:
Our purpose
We connect for a better future
Our aim is to improve one billion lives and halve our environmental impact
Our strategy
A converged communications technology leader, enabling the digital society
Our priorities
To extend our competitive advantage and improve returns by:
During the past year we have experienced a significant fall in our share price. Despite good performance in most markets, we faced increasing competition in Spain and Italy, as well as pressures in South Africa during the second half of the year. Although we met our financial guidance, our revenue growth slowed during the year and 5G spectrum auction costs were high, reducing our financial headroom and contributing to downward pressure on our share price. A decline in the value of our listed stake in Vodafone Idea was a further headwind.
Rebasing the dividend to support Vodafoneās transformation and rebuild headroom
Vodafone is at a key point of transformation ā deepening customer engagement, accelerating digital transformation, radically simplifying our operations, generating better returns from our infrastructure assets, and continuing to optimize our portfolio. In order to support these goals and to rebuild the headroom, the Board has made the decision to rebase the dividend to 9 euro cents per share. This will help us to reduce debt and move to the lower end of our targeted 2.5x-3.0x leverage range in the next few years. On pages 24 and 25, Margherita describes the comprehensive program of further deleveraging actions that we are taking, including the sale of our business in New Zealand for ā¬2.1 billion which we announced in May 2019.
Evolving our strategy to address industry headwinds
1. What are the key drivers of change in the communications industry as a whole? What do you expect their impact to be over the next five years?
2. How do you expect the UK communications industry to converge in this ever-changing global business environment? How attractive will that industry be?
3. After reading Vodafoneās strategic report from 2019, critically evaluate its strategy in relation to the key drivers of change in the communications industry you identified in response to question 1.
