Vodafone loss widens to €6.1bn but forecasts stronger growth

Branding for Vodafone is seen on the exterior of a shop in London Britain

Branding for Vodafone is seen on the exterior of a shop in London Britain

British mobile phone giant Vodafone logged on Tuesday an annual net loss of 6.3 billion euros ($6.9 billion) after slashing the value of its troubled Indian division.

Following the deal, Vodafone added today it had partially reversed the Indian impairment - but it still stood at €3.7 billion over the year.

Vodafone raised its final dividend a share by 2% to 10.03 cents, up 2%, giving total dividends per share of 14.77 cents.

Vittorio Colao, Vodafone's CEO, says he expects the company to generate free cash flow of €5 billion next year, compared to $4.1 billion last year.

It predicted a rise in organic adjusted core earnings growth of between 4 and 8 per cent and free cash flow of about 5 billion euros, up from 4.1 billion euros in the previous year.

"We expect to sustain our momentum in the coming financial year, generating free cash flow of around €5bn".

"Our confidence in the outlook is demonstrated by another 2% increase in our dividend".

In March this year Vodafone announced an agreement to combine its subsidiary Vodafone India with Idea Cellular.

The Indian writedown comes after it has suffered from the emergence of a new competitor in the once lucrative market, with new network Jio blowing rivals out the market by offering free calls and data until April 1.

The regulator said Vodafone had misled pay-as-you-go customers, charging them for top-up credit but "providing nothing in return".

Vodafone shares were marked 3.75% higher in the opening 30 minutes of trading in London, the biggest jump since early January, to change hands at 219 pence each, taking the year-to-date gain to around 9.33%, firmly ahead of the 5.6% advance for the Stoxx Europe 600 Telecommunications Index. "The good guidance for 2018 has to be interpreted in that context".

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