Vodafone Group PLC’s new chief executive officer, Margherita Della Valle, yesterday unveiled a plan to revive growth at the telecom giant, pledging to slash jobs and simplify the company’s corporate structure.
Vodafone is to cut about 11,000 roles across the about 104,000 people it employs over the next three years, work to turn around its German business and start a “strategic review” of its Spanish unit, the Newbury, England-based company said in a statement.
Della Valle, a 29-year Vodafone veteran who was previously chief financial officer and interim CEO before she was made permanent in the top role last month, said in the statement that she would reallocate resources to focus on the “quality service our customers expect” and grow the Vodafone Business unit.
Photo: Reuters
“Our performance has not been good enough. To consistently deliver, Vodafone must change,” she said in the statement. “My priorities are customers, simplicity and growth. We will simplify our organization, cutting out complexity to regain our competitiveness.”
The company’s adjusted free cash flow, a closely watched metric, would drop by about 31 percent to 3.3 billion euros (US$3.65 billion) in the fiscal year ending in March, following divestments, but also taking a hit due to “expected working capital movements,” the company said.
Much of the decline is due to a change in German law which affects how Vodafone is able to collect money from customers, a spokesman said.
A company-compiled consensus of analyst estimates had put the figure at 3.6 billion euros.
Earnings before interest, taxes, depreciation and amortization after leases are expected to be 13.3 billion euros in the year ending in March, which Vodafone described as “broadly flat” once factoring in the partial sale of mobile mast unit Vantage Towers AG and divestment of its business in Hungary.
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