Presentation Case Vodafone

8/8/2019 Presentation Case Vodafone

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GeneralVodafone is a mobile

network operator.

Headquartered inBerkshire, England, UK.

The largest mobiletelecommunicationsnetwork company in the

world. (market value of


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GeneralThe name of the company

(Vodafone) comes from

Voice data fone

reflect the provision ofvoice and data servicesover mobile phones.

Vodafone is managed and

organized through two


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Telecommunicati

ons ServicesCalls and SMS.

Vodafone At Home and

Vodafone OfficeVodafone Passport

Vodafone Live!

Vodafone 3G

Vodafone Mobile Connect

data cards and Mobile


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Estimated

penetration

Europe

andEMAPA


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GeneralVodafone is a mobile

network operator.

Headquartered inBerkshire, England, UK.

The largest mobiletelecommunicationsnetwork company in the

world. (market value of


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History1982

As Racal Telecomm, awarded thefirst mobile license in the UK

198

5

First mobile analogue call in the

UK1987

Launched Vodapage, a pagingnetwork covering 80% of thecountry

1988

Listed on the stock exchange

199

1

Separated from Racal Electronics

and since then quoted as


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History1999

Merged with AirTouchCommunications, producing a new

company, Vodafone Airtouch plc

2000

Began operating as the Vodafonegroup Plc.

200

0

Acquired Mannesmann AG and

established Verizon Wireless(grouping the mobile activities ofBell Atlantic and Vodafone

AirTouch in the USA)

200 Introduced Vodafone Live!


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History2005

Launched fixed mobileconvergence product in Germanycalled

Zuhause

200

6

Sold its Japanese unit to Softbank

and Swedish unit to Telenor

2007

Acquired controlling interestHutchison Essar Limited in India;

acquired Tele2 fixed


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EnvironmentAnalysisEU Regulatory:Framework for thecommunicationssector

The impact of EU Framework onVodafone: Vodafone had toreduce its mobile phone

termination rates considerably,


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EnvironmentAnalysisEconomic factors

The most commonindicator for measuring anations economic activity

is gross domestic product(GDP).

This indicator covers the

production activity of


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Economic factors the evolution of constant price

GDP (at fixed 2000 exchangerates) between 1995 and 2008

in the three Triad economies ofthe EU, Japan and the UnitedStates


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Economic factors

For the whole of thisperiod, GDP rose on

average by 2.4% perannum in the EU, whichwas below the average

rate of 3.1% per annumfor the United States, butabove the 1.4% per

annum growth rate


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EnvironmentAnalysisSocial Factors

Populationsocial systems

Consumption patterns

Education

Job markets in the coming

decades


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By 2045, the EU is likely to

have a significantly higherproportion of older personsthan its main global

competitors.


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EnvironmentAnalysisTechnological factors

Research anddevelopment (R&D) is adriving force behind

economic growth, jobcreation, innovation ofnew products, and

increasing quality of


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Telecommunications

Industry Analysis Porters five

forces

analysis is aframeworkthat isusually used

for theindustryanalysis and

business


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Telecommunications

Industry AnalysisCompetitive Rivalry

Telefnica O2TMobile

Orange

3


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Telecommunications

Industry AnalysisNetworks: BargainingPower of Suppliers

Network in Asia-Pacific.Majority-owned

Minority-owned

NoOwnersh

ipAustralia,

India,New

Zealand

Chinamainland,Fiji, India

Afghanistan, Armenia,

Hong Kong,

Indonesia,


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Telecommunications

Industry AnalysisNetwork in Europe.Majority-

owned

Minority-

owned

No

Ownership

Albania,Czech

Republic,Germany,Greece,

Hungary,

Ireland, Italy,

France,Poland

Austria,Belgium,Bulgaria,ChannelIslands,Croatia,

Cyprus,


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Telecommunications

Industry AnalysisNetwork in America.Minorit

y-owned

No Ownership

USA Anguilla, Antigua &Barbuda, Argentina, Aruba,

Barbados, Bermuda,Bonaire, Brazil, CaymanIslands, Chile, Colombia,

Curaao, Dominica,Ecuador El Salvador


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Strategy Review In May 2006, Vodafoneformulated a five point

strategy. maintained or improved share

against largest or referencecompetitors.

increased the share of revenuefrom non-core mobile servicesfrom 10% to 15%

increased ex osure to hi her


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Strategy Review Vodafone has three keyattributes:

Firstly, our scale in technologywith which we continue todrive network and IT savingsthrough consolidation andcentralisation of core activities.

Secondly, our strong presencein the enterprise market, in

large corporates as well as in


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Strategy Review Our strategy will now befocused on four key objectives:

Drive operational performance

Pursue growth opportunities intotal communications

Execute in emerging marketsand strengthen capitaldiscipline.


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Strategy Review


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Financial results Vodafone reportes its results inaccordance with InternationalFinancial Reporting Standards

(IFRS).Year

ended31

March

Turnoverm

Profitbeforetax m

Profitfor theyear m

Basic

EPS(pence

)

Proportion

atecustomers

(m)

200835,478

9,001 6,756 12.56 260

200731,104

(2,383)

(5,297)

(8.94)

206.4

2006*29,350

(14,835)

(21,821)

(35.01)

170.6

34,


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ProductsProducts promoted bythe Company include

Vodafone Live!Vodafone Mobile ConnectUSB Modem

Vodafone Connect toFriends

Vodafone at Home

Vodafone 710


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Corporate

SponsorshipVodafone Sponsored toImprove Awareness and

Perception of the Brand.Manchester United Football Club

Ferrari Formula 1 Team

Home-Start International:worldwide family support charity

UEFA Champions League

Vodafone Oaks and VodafoneDerby horse races


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SWOT Analysis


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SWOT AnalysisStrengthDiversified geographical

portfolio with strongmobiletelecommunicationsoperations in Europe, the

Middle East, Africa, AsiaPacific and to some extentthe US

Network infrastructure


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SWOT AnalysisWeaknessNegative return on assets

(ROA) underperforms keycompetitors like AT&T, BTGroup, Deutsche Telecom

US business not nearly as

strong as European/rest ofthe world operations

80% of its business is

generate in Europe


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SWOT AnalysisOpportunities

Focus on cost reductions

improving returnsMajority stake in

Hutchison Essar in India

Research and developmentof new mobile

technologies


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SWOT AnalysisThreats

Highly competitive market

Still lags behind majorcompetitors in the US

Extremely highpenetration


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Recommendation

s The main goal of the optimalstrategy is to create sustainablevalue for shareholders,

considering both opportunitiesfor benefit and threats tosuccess.

The value of a firm cangenerally be considered as afunction of four key inputs.

Cash flow to the firm


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Recommendation

s With these inputs, it is quiteclear that for a firm to increaseits value, it has to do one or

more of the following.

Generate more cash flowsfrom existing assets

Grow faster or moreefficiently during the high

growth phase

Lengthen the high growth


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Recommendation

sReduce Cost Increase Revenue

Develop and Offer NewProducts

Extend to New Markets

Sell UnprofitableBusinesses


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Documents

Presentation Case Vodafone