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> Record £14.9bn loss at Vodafone
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Vodafone made a £14.9bn ($27.9bn) loss last year - a record for a UK firm - after writing down the value of assets.
It incurred one-off costs of more than £23.5bn, mainly as a result of writing down the value of German business Mannesmann, which it bought in 2000.
The firm said it would also cut 400 jobs as part of a move to reduce costs.
Excluding one-off costs, Vodafone made a £8.8bn profit and it said its overall performance had exceeded expectations, after adding 21 million new customers.
Pressure growing
Vodafone warned earlier this year that its assets may be worth up to £28bn less than previously calculated and that it would be overhauling its operations in an effort to boost its growth.
Sales have been under pressure over the past year with the firm coming up against tougher competition.
It decided to sell its Japanese business for £8.9bn after failing to make much headway in the country.
However, it saw continued growth in other key markets such as Germany, Spain and the United States.
Vodafone said the market remained "challenging" and that it needed to do more to meet customer demands for new products.
But it stressed that its business remained fundamentally healthy, despite the huge loss.
"Vodafone has met or exceeded expectations, outperforming its competitors in an increasingly challenging marketplace," said chief executive Arun Sarin.
"Vodafone is well positioned to deliver on its strategy."
New focus
A new strategic focus will see Vodafone concentrate on growing sales in emerging countries such as India, reducing costs in more mature European markets and seeking to be more innovative.
Mr Sarin has been under pressure from investors as the firm's previously buoyant sales growth has slowed.
Revenue growth is set to slow to between 5% and 6.5% next year while profit margins from mobile phone activities are set to be 1% lower.
Mr Sarin has sought to stamp his authority over the company by restructuring the firm's senior management and pulling out of markets such as Japan where Vodafone's position was uncompetitive.
Mr Sarin stressed that Vodafone may exit other markets which did not offer strong long term growth prospects and that future acquisitions would be subject to "strict criteria".
However, Vodafone gave a vote of confidence to its US joint venture business Verizon Wireless, which some analysts want it to sell.
Verizon Wireless's market share grew to 25% in the US, as it added more than three million new customers, while Vodafone's share of profit from the business rose by more than 21%.
Via BBC NEWS
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Posted: 2006-05-30 10:23:47
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Vodafone warned earlier this year that its assets may be worth up to £28bn less than previously calculated and that it would be overhauling its operations in an effort to boost its growth.
How can you miscalculate 28 billion pounds worth of assets?
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Posted: 2006-05-30 10:25:44
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Only @ Vodafone.
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Posted: 2006-05-30 10:32:11
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i like how the beat the record for the biggest loss also, the previsous record being held by themselves..
good job voda.
fatreg
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Posted: 2006-05-30 10:58:26
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easily done mate! i often mistakeably forget about a fiver or tena iv spent on a drunken friday night. they just forgot about a rather large piss up! i promise you it will be alcohol related!
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Posted: 2006-05-30 11:16:36
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Vodafone cheifs must be drunk at all times then i guess:D
That's a heck of a lot of money....
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Posted: 2006-05-30 11:20:19
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ye it is a rather latge amount thinkin about it. maybe he got drunk and bought a small country?
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Posted: 2006-05-30 11:21:34
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I know Voda never hold back when it comes to freebies for sales staff and such. Even for the plebs at electronics stores (where I've worked), racing give-aways etc...
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Posted: 2006-05-30 12:55:22
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prehaps they should concerntrate more on removing the shitty red branding from their phones that way people would buy them
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Posted: 2006-05-30 13:02:14
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On 2006-05-30 10:25:44, methylated_spirit wrote:
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Vodafone warned earlier this year that its assets may be worth up to £28bn less than previously calculated and that it would be overhauling its operations in an effort to boost its growth.
How can you miscalculate 28 billion pounds worth of assets?
Simple!
This is because when they bought Mannesmann they OVER VALUED the share value of the company. In the years when Vodafone wanted the "expansion" strategy they bought the shares at a very high price in a bid to take over Mannesmann - and now they are worth a lot less, thus they miscalculated their assets.
So basically they probably werent drunk, but in my experience their CS acts like drunks.....
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[ This Message was edited by: Esater on 2006-05-30 12:28 ]
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Posted: 2006-05-30 13:22:31
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