 "Vodafone to increase dividend for first time in 8 yrs after Germany growth")
Vodafone's shareholders will be rewarded with the first dividend increase in eight years after a return to growth in Germany helped the European mobile and broadband operator upgrade its earnings outlook.
Shares in the British company, which are trading at two-and-a-half-year highs, rose 5 per cent to 94 pence after it reported on Tuesday a 5.9 per cent rise in first-half adjusted earnings to 5.73 billion euros ($6.68 billion).
The group slashed its dividend by 40 per cent in May 2019 after the cost of buying 5G spectrum caused its debt to balloon.
Chief Executive Margherita Della Valle has reshaped Vodafone since she took over in January 2023, merging with rival Three in Britain to become the market leader and exiting tough markets in Spain and Italy.
It is now the biggest or one of the biggest players in each of its markets and it has a growth strategy that underpins its medium-term outlook to increase free cash flow.
"It's been a long time since this happened in Vodafone and we are pleased that we are able to share this with our investors," Della Valle told reporters on Tuesday.
She said a new progressive dividend policy would deliver an expected increase of 2.5 per cent in the year to the end of March 2026.
RETURN TO GROWTH IN GERMANY
Vodafone returned to growth in Germany in the second quarter after the impact of a 2024 change in TV subscription rules ended.
It also said it had made a fast start in bringing together the Vodafone and Three networks in Britain.
"In the second quarter, we saw service revenue accelerating, with good performances in the UK, Turkey and Africa, and a return to top-line growth in Germany," Della Valle said.
The company expects to be at the "upper end" of its full-year forecasts for adjusted core earnings of 11.3-11.6 billion euros and group adjusted free cash flow of 2.4-2.6 billion euros.
You’ve reached your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%