​​​Vodafone set to release 2024 results amid turnaround efforts

​​​Vodafone expects to see revenue and EBITDA growth slow down as re-orientation strategy is being implemented

​Vodafone Group is slated to release its full year 2024 financial results on 14 May 2024, marking nearly two years since the previous CEO Nick Read unveiled his goal to turn around the struggling telecommunications giant.

​Investors will be watching closely to see if Read and his successor Margherita Della Valle’s - CEO since January 2023 - myriad efforts have borne fruit in stabilizing revenues and stemming customer losses across Vodafone's global operations spanning Europe, Africa, Asia Pacific, and the Middle East.

​​Full-year revenue up to March 2024 is expected to decline to EUR43,473 billion compared to EUR45,706 billion for full-year 2023 results. Earnings before interest, taxes, depreciation and amortisation (EBITDA) is expected to slow to EUR12,816 billion versus EUR14,665 billion a year ago and earnings per share (EPS) to 7 Euro cents versus 11 cents for full-year 2023.

​​Key areas of focus will include the company's cost-cutting initiatives, network investments, divestments of underperforming business units, and growth in new services like financial services and the Internet of Things. Of particular interest is the performance of Vodafone's largest profit engine - Germany - where ferocious competition for mobile and broadband customers resulted in six straight quarters of revenue decline before showing signs of improvement last year.

​Vodafone made waves in 2023 by cementing a landmark joint venture with Altice to combine their respective fibre assets in Germany, hoping to accelerate gigabit broadband availability while slashing costs. The deal followed Vodafone's 2021 exit from India and more recently, the sales of its operations in Hungary, Italy, and Spain as part of the telecom giant's push toward greater simplification.

​On the financial front, analysts will zero in on Vodafone's free cash flow, EBITDA, and guidance surrounding its dividend, which was controversially slashed by 40% for the 2023 fiscal year to preserve funds for 5G, fibre, and debt repayment. The reduced dividend nonetheless yields nearly 6% for shareholders - still far superior to market averages - but marked a major shift for a company long prized by investors for income. With Vodafone's debt load hovering around €43 billion, the company has limited wiggle room when it comes to restoring payouts.

​Beyond the numbers, the earnings call will offer insight into Vodafone's M&A strategy after talks to merge with Three UK - intended to gain scale against BT and Virgin Media-O2 - collapsed last year over regulatory concerns. Vodafone will also likely address how it aims to leverage its Vantage Towers infrastructure spin-off across Europe amidst a push toward network sharing deals that lower costs.

​And in the all-important postpaid mobile segment, analysts anticipate another year of subscriber losses industrywide, projecting a 2-3% decline at Vodafone Germany. Intensifying competition from discount brands like 1&1 continues squeezing the Big 3 German carriers, making Vodafone's progress on customer loyalty and 5G coverage more crucial than ever.

​For all of Vodafone's streamlining efforts, the telecom behemoth faces macroeconomic headwinds across continental Europe, currency fluctuations, high energy costs, and the ever-present threat of government intervention on mobile prices.

​After slightly more than a year in her role as CEO Della Valle’s wish to transform Vodafone into a more agile, focused connectivity provider will soon face its biggest test yet in the year-end results. The numbers will reveal whether her strategy is gaining traction or if the former industry leader risks falling further behind.

​Analysts recommendations

​Fundamental analysts are rating Vodafone between a ‘buy’ and a ‘hold’ with LSEG Refinitiv data showing 2 strong buy, 6 buy, 7 hold and 3 sell - with the mean of estimates suggesting a long-term price target of 90.30 pence for the share, roughly 34% above the share’s current price (as of 9 May 2024).

​Vodafone share price technical analysis outlook

​Vodafone’s share price, down nearly 3% year-to-date, has been trading in a wide sideways trading range since the beginning of the year. It has been capped by the January-to-April highs at 71.02p to 71.80p and supported by its 62.70p February low.

​Above this level support can be spotted between the mid-January, mid-March and April lows at 65.92p to 65.54p. While it continues to hold, a retest of the 71p region remains on the cards.

​Vodafone Daily Chart

​A medium-term bullish break out of this wide sideways trading range will only technically occur if a rise and weekly chart close above the 71.80p March peak were to be seen. In this scenario the September 2023 high at 82.56p could be back in the picture.

​A fall through the 65.92p to 65.54p zone would likely lead to the February low at 62.70p being revisited instead, though.

Vodafone Weekly Chart