Vodafone : Annual Report and Accounts for the year ended 31 March 2024

Vodafone Group Plc

Annual Report 2024

Contents

Strategic report

1	S FY24 highlights
2	S About Vodafone
3	S Operating in a rapidly changing industry
4	S Business model
6	S Key performance indicators

1. Chair's message
2. Chief Executive's statement and strategic roadmap
3. Mega trends

1. Stakeholder engagement

1. Our people strategy

1. Our financial performance

32 S Purpose, sustainability and responsible business

Welcome to our 2024 Annual Report

We continue to use a simplified digital-first approach to our reporting, reflecting how we operate as a business. We provide summaries at the start of each key section, denoted by an S .

New shape of the Group

Following the announced sale of Vodafone Spain and Vodafone Italy as part of right-sizing our portfolio for growth, both businesses are now treated as discontinued operations, and therefore excluded from Group results for continuing operations. Prior periods have also been re-stated to reflect the new shape of the Group.

Environmental, Social and Governance ('ESG') reporting

This year we have incorporated both our full cyber security and climate-related risk reporting into the Annual Report. We also report against a number of voluntary reporting frameworks to help our stakeholders understand our sustainable business performance. Disclosures prepared in accordance with the Global Reporting Initiative ('GRI') and Sustainability Accounting Standards Board ('SASB') guidance can be found in our ESG Addendum and on our website. Our website also includes a wide range of reports which can be found on the links below.

34	Our purpose
35	-	Empowering People
38	-	Protecting the Planet
43	Contribution to Sustainable Development Goals
44	Maintaining Trust
45	-	Protecting data
51	-	Protecting people
53	-	Business integrity
55	Non-financial information
57	Risk management

Corporate website vodafone.com

ESG Addendum investors.vodafone.com/esgaddendum

SASB disclosure investors.vodafone.com/sasb

A-Z of ESG disclosures investors.vodafone.com/esga-z

Investor Relations website investors.vodafone.com

ESG Addendum Methodology document investors.vodafone.com/esgmethodology

Cyber security factsheet investors.vodafone.com/cyber

ESG ratings investors.vodafone.com/esg-ratings

63	-	Long-term viability statement
64	-	Climate-related risk

Governance

70 S Governance at a glance

72	Chair's governance statement
74	Our governance structure
75	Division of responsibilities
76	Our Board

References

Our Annual Report has been designed for easy navigation. We have cross-referenced relevant material and included the below navigation icons. Online content can be accessed by clicking links on the digital version, copying the website address into an internet browser, or scanning the QR code on a mobile device.

Read more		Click to see related	Click or scan to watch related
page reference		content online	video content online

79	Our Executive Committee
80	Our Company purpose, values and culture
81	Board activities and principal decisions
84	Board effectiveness
86	Nominations and Governance Committee
89	Audit and Risk Committee
95	Technology Committee
96	ESG Committee
98	Remuneration Committee

100 Remuneration Policy

1. Annual Report on Remuneration

1. US listing requirements
2. Directors' report

Financials

1. Reporting on our financial performance
2. Directors' statement of responsibility

1. Auditor's report

1. Consolidated financial statements and notes

1. Company financial statements and notes

Watch our video content

Our performance

FY24 update:

Margherita Della Valle, Chief Executive, Luka Mucic, Chief Financial Officer

Purpose pillars

Digital inclusion

Net zero

Our governance

Our digital investor briefings

Vodafone

Digital services &

Vodafone

Social contract

Business

experiences

Technology

Responsible business

Data privacy

Cyber security

Human rights

Responsible

taxation

Other information

1. Non-GAAPmeasures

1. Shareholder information

1. History and development

1. Regulation

1. Form 20-F cross reference guide

1. Forward-lookingstatements
2. Definition of terms

Jean-François van

David Nish,

Amparo Moraleda,

Simon Segars,

Luka Mucic,

Boxmeer, Chair

Senior Independent

Chair of the

Chair of the Technology

Chief Financial

Director

ESG Committee

Committee

Officer

Deborah Kerr,	Stephen Carter,	Delphine Ernotte Cunci,	Christine Ramon,	Hatem Dowidar,
Non-Executive	Non-Executive	Non-Executive	Non-Executive	Non-Executive
Director	Director	Director	Director	Director

This document is the Group's UK Annual Report and is not the Group's Annual Report on Form 20-F that will be filed separately with the US SEC at a later date.

This report contains references to Vodafone's website, and other supporting disclosures located thereon such as videos, our ESG Addendum and Methodology document, and our cyber security factsheet, amongst others. These references are for readers' convenience only and information included on Vodafone's website is not incorporated in, and does not form part of, this Annual Report.

1	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

FY24 highlights

Progress against our strategic priorities	FY24 results
We have made good initial progress against our	Our financial performance was slightly ahead
strategic priorities, which are focused on	of expectations for the year.
Customers, Simplicity and Growth.
We have right-sized our European portfolio for growth.
Organic service revenue growth1
During the year we announced:

	- UK: merger of Vodafone UK and Three UK
€8bn	- Italy: sale of Vodafone Italy to Swisscom
€5bn	- Spain: sale of Vodafone Spain to Zegona

We are now focused on growing telecommunications markets, where we have strong assets and good scale.

Progress against our strategic priorities:

Customers

Consumer NPS	Detractors	Revenue
market share

Germany

UK

Other Europe

South Africa

Key: Improved Deteriorated Stable

Network quality

Very good reliability in all European markets. German cable network quality recognised in 4 independent tests

Simplicity

	Europe opex savings1			Productivity1
	€0.4bn			c.5k
	(FY23 and FY24)			role reductions
	Shared operations NPS			Employee engagement
+85%	+75%
		Growth2
	Organic service		B2B organic service
	revenue growth			revenue growth
+6.3%	+5.0%
	Organic adjusted			Adjusted free cash flow
	EBITDAal growth			€2.6bn
+2.2%

Pre-tax return on capital

employed

+7.5%

Notes:

1. Includes Vodafone Italy and Vodafone Spain.
2. These are non-GAAP measures. See page 235 for more information.

		6.6%	6.3%	7.1%
	5.4%
3.4%	3.0%	4.2%	3.6%	4.0%
1.6%
Q4 FY23	Q1 FY24	Q2 FY24	Q3 FY24	Q4 FY24
	Group	Group excluding Turkey

• All segments growing in FY24
• Group growth accelerated in Q4
• Vodafone Business +5.4% growth in Q4

Adjusted EBITDAaL

€14.7bn		+2.2%2
	(2.3)	€12.4bn	€11.0bn
	33.0%	30.0%
FY23	Italy &	FY23	FY24
EBTDAaL	Spain	EBTDAaL	EBTDAaL
(reported)		(re-presented)	(reported)

• On a like-for-like basis +2.2% growth in FY24
• EBITDAaL margin impacted by higher energy costs

Return on capital employed ('ROCE')3

6.8%		1.4pp	8.2%	7.5%

FY23	Italy &	FY23	FY24
(reported)	Spain	(re-presented) (reported)

Pre-tax ROCE

• Higher pre-tax ROCE under the new footprint
• Lower operating profit impacting year-over-year

Full year dividend: 9.0 eurocents per share

Notes:

1. Organic growth. See page 235 for more information.
2. Organic Adjusted EBITDAaL growth.
3. This is a non-GAAP measure. See page 235 for more information..

Click or scan to watch our Group Chief						Read more about our
Executive, Margherita Della Valle					financial performance
and Chief Financial Officer provide					in FY24 on pages
an update on our FY24 results:					21 to 31
investors.vodafone.com/videos

2	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

About Vodafone

We are a leading European and African telecommunications company transforming the way our customers live and work through our technology, platforms, products and services.

Where we operate

We operate mobile and fixed networks in 15 countries and have stakes in a further seven countries through our joint ventures and associates. We also partner with mobile networks in 43 countries outside our footprint. Our portfolio of local markets is supported by corporate services and shared operations, which deliver benefits through scale and standardisation.

How we are structured and what we sell

Our business comprises of infrastructure assets, shared operations, growth platforms and retail and service operations. Our retail and service operations are split across three broad business lines: Vodafone Business, Europe Consumer and Africa Consumer.

Core connectivity products and services in fixed and mobile account for the majority of our revenue. However, our portfolio also includes high return growth areas that leverage and complement our core connectivity business, such as digital services, the Internet of Things ('IoT') and financial services. We market and sell through digital and physical channels.

Europe1

Africa

9 countries

98m mobile customers

17m fixed customers

4m converged customers

6 countries

157m mobile customers

46m FinTech users

Vodafone Business

€8bn

service revenue

We serve private and public sector customers of all sizes with a broad range of connectivity services, supported by our dedicated global network. We have unique scale and capabilities, and are expanding our portfolio of products

and services into growth areas such as unified communications, cloud & security, and IoT.

Europe

Consumer1

€16bn

service revenue

We provide a range of market leading mobile and fixed line connectivity services in our European markets. Our converged plans combine these offerings, providing simplicity and better value for our customers.

Other value added services include our Consumer IoT propositions, as well as security and insurance products.

Africa

Consumer

€5bn

service revenue

We provide a range of mobile services. The demand for mobile data is growing rapidly driven by the lack of fixed broadband access and by increased smartphone penetration. Together with Vodacom's VodaPay super-app and the M-Pesa payment platform, we are the leading provider of financial services, as well as business and merchant services in Africa.

Note:

1. Includes Turkey.

3	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

Operating in a rapidly changing industry

Our governance

Our business is underpinned by our strong governance and risk management framework.

Mega trends

The long-term trends that are shaping our industry and driving new growth opportunities.

Governance

Connected devices

The Board held seven scheduled meetings this year to discuss key strategic matters, our purpose and culture, our people and stakeholder interests. The Nominations and Governance Committee evaluates the composition and performance of the Board and ensures an appropriate balance of independence, skills, knowledge, experience and diversity. The Audit and Risk Committee provides effective governance over the appropriateness of financial reporting of the Group, including the adequacy of related disclosures, the performance of the internal audit function and the external auditor and oversight of the Group's systems of internal control, risk management framework and compliance activities. The Technology Committee supports the Board with fulfilling the technology strategy for the Group, including assessing risks and

Click or scan to watch our Vodafone Business investor briefing: investors.vodafone.com/ vtbriefing

• A wide range of new devices, across all sectors and applications, are increasingly being connected to the internet.
• The Internet of Things ('IoT') is expected to create huge value for businesses and society, unlocking new efficiencies by delivering real-time information.
• As the number of IoT devices increases, physical assets are also communicating with each other in real-time and new digital markets are being established giving birth to the 'Economy of Things'.

exploring new innovations for future growth.

The ESG Committee oversees our Environmental, Social and Governance ('ESG') programme, including our purpose, sustainability and responsible business practices, and our contribution to the societies we operate in under our social contract.

The Remuneration Committee advises the Board on policies for executive remuneration and reward packages for the Chair, executives and senior management team.

Click or scan to watch our Non-

Read more

Executive Directors speak about

on pages 70 to 99

their roles in short video interviews:

investors.vodafone.com/videos

Digital payments

											- Businesses demand reliable and secure mobile
											connectivity as transactions migrate to online
											channels and apps.
Click or scan to watch	- In Africa, increasing smartphone penetration
our Digital Services	drives the adoption of digital payments.
investors.vodafone.com/	- Network operators and a range of FinTech
investor briefing:	startups are using mobile payment
digital-services
											applications to sell additional financial services
											focused products such as insurance and loans.

Adoption of cloud technology

Risk management

Risks are not static and as the environment changes, so do risks - some diminish or increase, while new risks appear. We continuously review and improve our risk processes in order to ensure that the Company has the appropriate level of support in meeting its strategic objectives.

Our risk framework clearly defines roles and responsibilities, and sets out a consistent end-to-end process for identifying and managing risks. We have embedded the risk framework across the Group as this allows us to take a holistic approach and to make meaningful comparisons. Our approach is continuously enhanced,

Click or scan to watch our Vodafone Technology investor briefing: investors.vodafone.com/ vtbriefing

• The cloud is increasingly utilised by businesses and consumers as a more efficient way of sharing compute capacity and services.
• SMEs increasingly understand the benefits of cloud technology but lack the technical expertise or direct relationships with cloud specialists to make an effective transition to the cloud.
• This presents an opportunity for network operators to play a role as a partner to support smaller businesses on their digital transformation journeys.

enabling more dynamic risk detection, modelling of risk interconnectedness and use of data, all of which are improving our risk visibility and our responses.

Our Board oversees principal and emerging risks, which are reported to the various management committees and the Board throughout the year. Additionally, risk owners are invited to present in-depthreviews to ensure that risks are continuously monitored, and appropriate treatment plans are implemented to bring each risk within an acceptable tolerance level.

Click or scan to watch our privacy and

Read more

cyber experts explain how we protect

on pages 57 to 63

customer data and our networks:

investors.vodafone.com/videos

Generative artificial intelligence ('Gen AI')

- The full range of potential applications and

long-term impacts of Gen AI are only starting

to be understood.

Click or scan to learn

- The technology is widely expected to drive

more about how Vodafone

significant economic benefit globally through

works with artificial

productivity increases and new business

intelligence ('AI'):

opportunities.

investors.vodafone.com/

artificial-intelligence

- Potential applications include AI-generated

content for marketing campaigns, customer

care and back-office activities.

Read more

on pages 10 to11

4	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

Business Model

Our investment case

We operate in growing markets, where we hold strong positions with good local scale. We have a sustainable and predictable financial profile, and have compelling structural drivers in Vodafone Business, Africa and in our portfolio of investments.

1 Strong positions in growing markets

2Focus on driving operational excellence

3Sustainable and predictable financial profile

4Structural growth drivers

Attractive markets

Germany

UK

Other Europe

Africa

Market size

€57bn

€56bn

€28bn1

€18bn

+3.2%

+3.4%

+3.1%

+6.8%

Majority three player markets, all growing over the last three years

Strong assets

Vodafone revenue mix

38%

19%

23%2

20%

Service revenue growth3

0.2%

5.0%

4.2%

9.2%

Vodafone growing faster than the market in most regions

Right-sized for growth & reorganised for operational excellence

Europe1

Africa4

Business

Investments

- 9 countries

- 6 countries

- Connectivity

- Operations

- 98m mobile

- 157m mobile

- Communications

- Infrastructure

customers

customers

services

- Innovation

- 17m fixed customers

- 46m FinTech users

- Cloud & Security

- Partner Markets

- Internet of Things

(43 countries)

Shared Operations	- Technology and	- Roaming and carrier	- Network services
- Procurement
		operations	services
Cash flows		Robust balance sheet	Attractive returns
- Growing free cash flow per	- Long dated and low cost debt	- Secure and growing dividend
share		2.25-2.75x	programme
			- Long-term share buyback

target leverage range

Vodafone Business	Africa	Investments & innovation
Digital service growth	Financial service growth
+11%	+20%

Notes:

1. Includes Turkey.
2. Includes Turkey and Common Functions.
3. Organic growth. See page 235 for more information.
4. Excludes Safaricom.

5	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

Clear and consistent strategic priorities

To drive operational excellence across the Group.

Creating long-term value for our stakeholders

We are committed to delivering value and building strong relationships with all of our stakeholders.

Our priorities

Customers

• Delivering the simple and predictable experience our customers expect
• Getting the basics right and refocusing our resources towards improving customer experience

Simplicity

• Become a simple and faster business
• Simplify our operations and executing on our cost programmes to improve profitability

Growth

• Right-sizingthe portfolio for growth
• Significant opportunity to grow in:
• • Business
  • Africa
  • Vodafone Investments

Well positioned to take advantage of the key mega trends shaping our industry

Our customers	310m		1	22m
	mobile customers		broadband
	18m			customers1
	1
	TV customers
Our people	93,000		75%
	employees and		employee
	contractors			engagement index
Our suppliers	8,000			€19bn
	suppliers			spend
	€6.3bn
	capital additions
Our local	€40m
communities and
non-governmental	donated in contributions and in-kind
organisations	services, combined with our technology, to
improve health and education, and provide
('NGOs')
emergency response across 21 countries.
and regulators	€2.6bn		€9.3bn
Government	total direct			total tax and
	contribution across2	economic
	63				contribution2
	2
	markets
Our investors	Secure and		Sustainable
	growing			returns
	dividend

				Read more	Notes:
Read more			on pages 12-14	1.	Includes VodafoneZiggo and Safaricom.
on pages 9 to 11				2.	FY23.

6	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

Financial and non-financial performance

Key Performance Indicators

Our progress

We measure our success by tracking key performance indicators that reflect our strategic, operational and financial progress and performance.

Financial results summary1

					2024	2023	2022
			Group revenue	€m	36,717	37,672	37,010
		Group service revenue	€m	29,912	30,318	30,207
		Operating profit	€m	3,665	14,451	5,740
	Adjusted EBITDAaL2	€m	11,019	12,424	12,693
		Profit for the financial year (continuing operations)	€m	1,570	12,582	2,588
		Basic earnings per share (continuing operations)	€c	4.45	43.66	7.07
	Adjusted basic earnings per share2	€c	7.47	11.28	10.18
		Cash inflow from operating activities	€m	16,557	18,054	18,081
		Adjusted free cash flow2	€m	2,600	4,139	4,560
		Net debt2	€m	(33,242)	(33,250)	(39,711)
		Total dividends per share	€c	9.00	9.00	9.00

Performance against our strategic priorities1

Customers

Consumer NPS

Germany

UK

Other Europe

South Africa

Detractors

Germany

UK

Other Europe

South Africa

2024

			2024
	Simplicity
Europe opex savings3 (FY23 and FY24)	€bn	0.4
Employee engagement index4,5	%	75
Shared operations NPS4	%	85
Productivity (role reductions)3	thousand	c.5

2024

Growth2

Revenue market share

Germany

UK

Other Europe

South Africa

Key: Improved Deteriorated Stable

Network quality

Very good reliability in all European markets. German cable network quality recognised in 4 independent tests.

Notes:

1. The results for the year ended 31 March 2024 exclude Vodafone Spain and Vodafone Italy and therefore, except as otherwise described, the results for the year ended 31 March 2023 and 31 March 2022 have been re-presented to reflect that.
2. These are non-GAAP measures. See page 235 for more information.
3. Includes Vodafone Italy and Vodafone Spain.

Organic service revenue growth	%	6.3
B2B organic service revenue growth	%	5.0
Organic adjusted EBITDAaL growth	%	2.2
Adjusted free cash flow	€bn	2.6
Pre-tax return on capital employed	%	7.5

1. As at May 2024.
2. The employee engagement index is based on an average index of responses to three questions: satisfaction working at Vodafone; experiencing positive emotions at work; and recommending us as an employer.

7	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

A purpose-led, sustainable and responsible business

We want to enable a digital, inclusive and sustainable society. To underpin the delivery of our purpose, we ensure that we operate in a responsible way. Acting lawfully and with integrity is critical to our long-term success.

Empowering People1,2		2024	2023	2022
4G population coverage (outdoor 1Mbps) - Europe2	%	99	99	99
4G population coverage (outdoor 1Mbps) - Africa3	%	74	70	66
4G population coverage (outdoor 1Mbps) - Group2	%	85	83	80
Cumulative V-Hub unique visitors4	million	3.3	2.3	3.65
Customers connected to our financial inclusion services6	million	66.2	60.7	54.5
Protecting our Planet1,2		2024	2023	2022
Energy use
Total energy use	GWh	5,217	5,052	4,926
Mobile and fixed access network and technology centres energy use	%	93	93	93
Percentage of purchased electricity from renewable sources	%	84	75	69
Percentage of purchased electricity from renewable sources in Europe	%	100	100	93
Greenhouse gas emissions ('GHGs')
Total Scope 1 and Scope 2 GHG emissions (market-based method)	m tonnes CO2e	0.69	0.91	1.02
Total Scope 3 GHG emissions	m tonnes CO2e	6.07	6.92	6.91
Total customer emissions avoided due to our green digital solutions7	m tonnes CO2e	32.8	24.9	13.5
Waste
Total network waste (including hazardous waste)	metric tonnes	6,205	7,716	6,367
Network waste reused or recycled	%	96	95	96
Maintaining Trust1		2024	2023	2022
Our people
Average number of employees and contractors	thousand	93	91	90
Employee turnover rate (voluntary)	%	9	12	14
Women on the Board	%	42	54	50
Women in management and senior leadership roles	%	35	33	31
Women as a percentage of employees	%	39	39	39
Health & safety
Number of lost-time incidents - employees and contractors	#	18	13	9
Lost-time incident rate per 200,000 hours8	#	0.02	0.01	0.01
Code of Conduct
Completed 'Doing What's Right' employee training5	%	94	92	89
Number of 'Speak Up' reports5	#	649	505	642
Tax and economic contribution
Total tax and economic contributions9	€bn	-	9.3	8.2
Responsible supply chain
Total spend10	€bn	19	21	20
Number of direct suppliers10,11	thousand	8	9	9
Number of site assessments conducted collectively by JAC12 initiative members	#	150	83	71

Notes:

1. Information relating to 2023 and 2022 has been restated to reflect portfolio changes completed during FY23 and FY24.
2. Operations in Italy and Spain have been classified as discontinued operations in line with 'IFRS 5 - Non-current Assets Held for Sale and Discontinued Operations'. All remaining operations are reported as continuing operations. This disaggregation of information has been reflected in all comparative periods.
3. Based on coverage in Africa, including Egypt.
4. Includes 100% of data relating to Vodafone Ziggo.
5. Includes Vodafone Italy and Vodafone Spain.
6. Includes 100% of data relating to Safaricom.
7. The avoided emissions for 2022 have been restated to 13.5 million tonnes CO2e (previously 15.6 million tonnes CO2e) resulting from the incorrect calculation of emissions avoided in fleet management solutions.

1. Total Recordable Incident Rate ('TRIR') is an industry-standard calculation that is based on the assumption that 100 employees work a combined 200,000 hours p.a (equivalent to 40 hours per week, for 50 weeks of the year per employee).
2. Includes direct taxes, non-taxation based revenue mechanisms, such as payments for the right to use spectrum, and indirect taxes collected on behalf of governments around the world, excludes joint ventures and associates. The FY24 figure will be finalised during FY25. For more information, refer to our Tax and Economic Contribution reports, available at: vodafone.com/tax.
3. Unique suppliers based on suppliers' ultimate parent company.
4. Excludes Vodafone Automotive.
5. Joint Alliance for CSR.

8	Vodafone Group Plc	Strategic report	Governance	Financials	Other information
Annual Report 2024

Chair's message

Reshaping Vodafone for growth

This has been a year of significant change as we aim to deliver our purpose to connect for a better future. We have taken all the steps needed to transform our portfolio and good progress has been made with our strategic priorities of Customers, Simplicity and Growth.

Portfolio transformed, good initial strategic progress

As I said last year, the Company has underperformed and further change is needed to drive sustainable value creation for our shareholders. The Board and I have been pleased with Margherita's pace and decisiveness over the last year and we have seen the first impacts of our focus on our new strategic priorities of Customers, Simplicity and Growth. Whilst there is much more to do, we are making faster and more decisive commercial decisions, customer satisfaction has seen broad-based improvements, and we have moved towards a commercial model for our shared operations. Vodafone Business growth is accelerating as we are strengthening our position as the leading platform for businesses, supported by unique strategic partnerships. We are also forging partnerships that leverage our existing strengths, unlock value and accelerate growth.

The shape of the Group has also changed as we focus on markets where we can grow and earn returns on our investments in excess of our cost of capital; this was not possible organically in UK, Spain or Italy. With our reshaped footprint, Vodafone will have strong positions with good local scale in each of our markets, and this will ensure we can deliver sustainable and predictable growth and a step-up in returns.

Board composition

Following an extensive and rigorous search, I was delighted to welcome Luka Mucic as Chief Financial Officer and an Executive Director of the Board in September 2023. Luka brings substantial experience in finance, international leadership and enterprise & technology solutions. Luka has been very supportive of the transformation of Vodafone and I am confident that his track record and expertise will aid the delivery of our strategic priorities.

We have also welcomed Hatem Dowidar, Group Chief Executive Officer of e&, to our Board as a Non-Executive Director from 19 February 2024. Hatem represents our largest shareholder and brings extensive telecommunications experience. He also knows us well after holding various Vodafone leadership positions prior to joining e&. Hatem's appointment to the Board marks the next phase of our strategic relationship with e&.

Last year, the Board approved the creation of a Technology Committee as a Committee of the Board. I have been pleased to see the Committee and its expert membership bring additional insight to the Board and Vodafone, in its first year overseeing the Group's technology strategy and considering how it supports the overall Company strategy today, and in the future.

FY24 financial performance & new capital allocation framework

Our financial results for FY24 were ahead of expectations and we achieved our financial guidance for the year.

Total revenue declined 2.5% to €36.7 billion, with Group organic service revenue growing by 6.3%1 this year. This was driven by growth in Europe, Africa and Business.

Our reported financials were also impacted by adverse currency movements during the year.

Adjusted EBITDAaL increased by 2.2%1 on an organic basis as good service revenue progress was partially offset by higher energy costs and inflationary impacts. Adjusted free cash flow was €2.6 billion1, reflecting lower adjusted EBITDAaL. Group return on capital employed

Notes:

1. This is a non-GAAP measure. See page 235 for more information.
2. Proforma ratio after adjusting for foreign exchange and M&A.

increased as a result of the right-sizing of our portfolio, however decreased year-on-year to 7.5% on a pre-tax basis due to lower operating profit1. Group operating profit decreased by 74.6% to €3.7 billion, primarily reflecting business disposals in the prior financial year and adverse foreign exchange rate movements, and as a result basic earnings per share decreased to 7.47 eurocents. Our balance sheet position remains robust, with Group leverage now at 2.5x2.The Board has declared a total dividend per share of 9.0 eurocents with respect to FY24, implying a final dividend per share of 4.5 eurocents, which will be paid on 2 August 2024 following shareholder approval at our AGM.

In March 2024, we announced a new capital allocation framework as the execution of our portfolio right-sizing has provided the necessary clarity over the future shape of the Group. Under our new capital allocation framework, we will continue our disciplined investment approach, supporting our network, strategy and growth levers; adopt a new lower target leverage range with built-in flexibility; re-base the FY25 dividend to 4.5 eurocents per share to reflect the reshaped Group, with an ambition to grow over time; and return surplus capital to shareholders through share buybacks.

Connectivity drives competitiveness

As the economies and societies in Vodafone's markets continue to evolve, our role in providing digital connectivity and solutions grows in importance, not only for our customers but for policymakers too. Our digital services help to improve lives, transform industrial productivity, drive growth and secure infrastructure. We remain firmly committed to supporting Europe's and Africa's digital ambitions for the benefit of their citizens and businesses.

In Africa, connectivity that enables our customers to access the internet and make mobile money transfers is fundamental to the economic development of the six countries in which we operate. As more customers wish to move to more advanced technologies, Vodafone is working with international partners and multilateral institutions to tackle the challenge of smartphone affordability.

In Europe, a 'connectivity chasm' is opening with regions like North America and Asia. There is a risk that in the future Europeans will have inferior access to the latest digital innovations simply because of outdated public policies. As a result, Europe will lack the advanced connectivity that is essential to its global competitiveness.

Though European policymakers have made some progress, the telecommunications market in Europe remains highly fragmented and more needs to be done to create the right environment for investing in next-generation connectivity. With structurally low returns on capital in European markets and its wider importance to competitiveness, connectivity must be a priority for European politicians as they seek to reverse the continent's declining productivity and share of global output.

This is an important year for Europe. European Parliament elections and a new European Commission give political leaders the rare chance to change course and return the continent to its position as a global economic leader. They must take it.

The year ahead

On behalf of the Board, I would like to thank all our colleagues across the Group who have continued to work tirelessly to support our transformation as we focus on our customers, become a simpler business, and accelerate growth.

As we enter FY25, I am confident that Margherita and her management team will continue to make progress on our strategic priorities. The 'reshaped Vodafone' will be a best-in-class telco in Europe & Africa and the leading platform for businesses, ultimately delivering value for all our stakeholders.

Jean-François van Boxmeer

Chair