Vodafone Group Plc

Good morning everyone and thank you for joining us. Before moving to Q&A, I will briefly provide an update on our performance in FY26 as well as our growth outlook. Vodafone is now entering a new chapter as a simpler and stronger business. Simpler because we have gone through a significant transformation over the last three years, covering all aspects of our business, including portfolio, capital structure and operating model. And we are stronger because our continued operational progress with our strategic priorities of customer simplicity and growth. With these foundations and the range of opportunities across our diversified and balanced portfolio, we are in a strong position to grow in FY27 and beyond. And as I mentioned growth, that leads me on to our financial results. We are pleased with our performance in FY26 as we have achieved the upper end of our expectations. Group service revenue growth remained strong in the fourth quarter at 5.1% with growth across both Europe and Africa. In Germany, despite the ongoing pressure in TV and the mobile market remaining competitive, our performance has improved, as we are now growing in B2B and consumer broadband. These improvements are direct results of our actions. In consumer broadband, we have continued to improve customer satisfaction and increased front book prices, and our value equation is working. And in B2B, we are benefiting from the capabilities we have developed in digital services, including cloud, security, and AI. In our emerging markets, we grew service revenue in Europe during the year. Our second largest division, Africa, reported a great set of results yesterday, with strong performances across all of our markets, delivering its highest service revenue growth in almost two decades. On profitability, We delivered 4.5% organic growth in adjusted EBITDA for FY26, fully in line with the upper end of our guidance. We also generated 2.6 billion of adjusted free cash flow, continuing the cash growth trajectory we have been building since FY24. And following our announcement of a progressive dividend policy, we increased the full year FY26 dividend by 2.5%. For FY27, we are guiding for continued good growth in both adjusted EBITDA and adjusted free cash flow. But let me move beyond financials for a moment to give you an update on where we are operationally and our confidence for the medium term. As you know, we are now focusing our resources on markets with sustainable structures where we have scale and strong positions. And with our new portfolio, we are entering an exciting new era for connectivity. We are operating in a more supportive environment with sustainable pricing models embedded in more markets than ever before, increasingly pro-investment spectrum decisions, and a better understanding of the benefits of in-market scale. But now let me look at our strategic progress in each of our markets, starting with Germany. I'm particularly pleased that we continue to deliver consistent NPS improvements across all segments, quarter after quarter, with our highest ever levels in mobile and cable. This is supported by the customer care initiatives that we are rolling out across our markets, such as our Ask Once commitment. In terms of the year ahead, we will continue to focus on becoming the market leader in customer experience, a one-stop-shop provider for fixed, mobile, and TV, and the trusted B2B partner of choice. Whilst we currently operate in a challenging market environment in Germany, I am confident that we are taking the right actions for the long-term health of the business. Turning to the UK, We are still less than a year ahead into our integration, but we have made significant progress. The latest independent tests have continued to show the considerable mobile network quality improvements we are delivering for our customers. And we can see this feeding through to our results with step changes in both customer satisfaction and loyalty. We have also recorded our fastest ever year of home broadband customer growth. with the largest gigabit footprint of any operator. This year is an important one for us in the UK. Not only have we announced that we will be taking full ownership of Vodafone 3, but we will also deliver the first meaningful cost and capex synergies. And we will continue to drive revenue synergies with our multi-brand portfolio, unified store footprint, and significant cross-selling opportunities. As an example, just yesterday, we announced that we are bringing fixed wireless access to a further 3.7 million homes. And finally, on Africa, we continue to expand beyond connectivity as we're on Africa's largest fintech platform, with over 100 million users now and millions of merchants. We are really excited about the future in Africa, with structural growth opportunities from population and customer growth, rising smartphone penetration, and growing data usage. Bringing all this back to our growth outlook. Our growth will be driven by our differentiated assets, strong market positions, and attractive opportunities across Europe, Africa, and B2B. After the transformation of the last three years, we are a simpler and stronger business. We have a clear strategy, and to continue the execution of our priorities, we are well positioned for growth. And our confidence in our growth portfolio is reflected in our mid-term ambition to deliver double-digit organic growth in adjusted free cash flow. And with that, Pilar and I are looking forward to your questions.

Thank you, Margarita. As a reminder, please only pose one question to give all analysts a chance to speak. The first question this morning comes from Robert Grindle at Deutsche Numis. Robert, please go ahead.

Good morning and thank you. Before we get into the full year results detail, I'd like to revisit the reinstatement after quite some time, your midterm targets to drive double-digit free cash flow growth, which you just mentioned. To my mind, this is a step change in your confidence interval about prospects over multiple years. Why do you feel that now is the time to reinstate a longer-term outlook? And what is underlying your raised level of confidence? Thank you.