Vodafone Group has released its financial report for 2019

Vodafone has announced that it is on course to reduce operational expense across the group by €1.2 billion, by the end of 2021.

In its Annual Report for 2019, Vodafone said that it had brought this target forward from its original target date of 2023.

"During the year, given strong early progress in our operating transformation we decided to accelerate the implementation timeline for our ‘Digital Vodafone’ programme from five years to three years. As a result we now expect to reduce net operating expenses in Europe and common functions by at least €1.2 billion by the end of FY21 compared to the FY18 levels, implying an annual run rate saving of c.€400 million," said Vodafone’s chief financial officer,  Margherita Della Valle.

Della Valle said that by reducing opex, Vodafone would give itself the financial head room it needs to operate comfortably, whilst simultaneously boosting EBIDTA.  

"I am pleased to confirm that we achieved this run-rate in FY19, and we are well on track to deliver a similar result in FY20. In addition, in our Rest of the World region we grew opex below local inflation levels, a result we expect to sustain going forwards. Combined with further mid-term opportunities to improve distribution efficiency and reduce commercial costs by selling through digital channels, we expect to continue to expand our EBITDA margins, building on the momentum of the past few years," she added.

Della Valle also stated that the company was heavily focussed on capitalising on the benefits of its forthcoming acquisition of Liberty Global’s assets in Central and Eastern Europe.

"We will also be highly focused on realising the substantial opex and capex synergies created by the announced Liberty Global transaction. We target €535 million of run-rate synergies in Germany and CEE by the fifth-year post completion. In addition, we have significant further synergies to capture in our Joint Ventures in India and the Netherlands," she concluded. 

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