Member Info for Android101

*possible
*competitive
..aimo

'worry for institutions'
Not sure if institutions are more worried about Vod or interest rates rising. Lagarde says lower interest rates for longer.
Vod liquidity profile is strong.
As reported:
Net cash position = €9.8 billion
Unused facilities = €7.4 billion
Maintain target of 2.5-3.0x leverage
No short-term refinancing requirements
Mandatory convertible bond maturing in March 2022

Vod is shooting for €15.0Bn - €15.4Bn ebitda in 2022 which should see them at the lowest end of the range 2.5/3.0 imo.

The debt profile looks sensible/ manageable if you accept that debt is a cheaper source of capital over the long term. The network asset valuable and the challenge is to leverage more from it as efficiently as ppssible (Vantage etc). Accumulated losses have to be seen in context of building the assets and using next gen technologies to remain cometitive/ economic. Vod is a world leader.

Vod says
'Our mid to long-term debt is primarily financed via corporate bond programmes and short-term funding requirements are met through our commercial paper programme. We use derivative instruments to manage our currency and interest rate risk and collateral support agreements to mitigate the credit risk of banking counterparts.'

https://investors.vodafone.com/debt-investors/financing-strategy

*available

'dividend is well covered by free cash flow
At the end of the day, the strategy is not to continue to spend capex on network at the same historical intensity, hence vantage is sharing those costs across the 'markets'. So [€5Bn] sustainable freecashflow is abailable for divs, interest, taxes etc and any commercially sensible capex. Demand for Enterprise segment capex will probably return when large corporates are ready to spend again ( ie revenue to Vod).

'They can't be all wrong and even the lowest represents > 40% upside from here.'
Yes, keep your head. I added a few more at the end of the day.
The management confirmed FY guidance at Q1 and so I am looking for confirmation at Q2.
GLA

klaw, 16 Nov is the date Vod declares an interim dividend. It has not been declared yet. 16 Nov is the date when we get to see H1 /Q2 performance.
So you cant bank it yet, though Q1 was good and the BoD confirmed FY guidance..

'To be fair, they are doing well in the metropolitan areas, and Mpesa, which is Africa's largest mobile money platform.
Mpesa is apparently used in 10 countries, Kenya, Tanzania, Mozambique, DRC, Lesotho, Ghana, Egypt, Afghanistan, South Africa and Ethiopia.'
Migration has historically been a route out of poverty. Africa and India will experience high levels of migration ands some est. 2.8Bn people will migrate from rural to urban in Africa and Asia over the next 30 years.
Vod Mpesa, 3G, 4G positioned to benefit from the growth in the demand for access/ participation in modern (digital) economies. imo
http://www.viewsoftheworld.net/wp-content/uploads/2017/04/GlobalRuralMigrationMap.png

Are these call centre workers vod employees or through a 3rd party with an appropriate commercial performance contract. Also, we now have Tobi the chatbot!

Does remind me of the lee evans sketch where he is filling in airline travel forms and finally says, 'I only wanted to go on holiday, not work for the ****** company'

The africa model has different economies of scale than Europe. Where europe accounts for a denser network build and debt, africa commercially leverages the partner model, Vod brand ($20Bn value) and less capex intensive imo.

Also, little spoken about is global connectivity and this includes the west africa cable system.

Vod has sold indefeasible rights of use across these systems but has its own use global capacity, a valuable competitive advantage. I cant imagine the global internet without this capacity (google et al)

So there is organic revenue growth at different rates in different countries (Mikey posted a link to a potential rerating of Vod). And then there is the potential sales/ disposal value if Vod think the cable systems are not strategically core. Vod is pregnant with cash/ potential cash imo
https://www.vodafone.com/business/wholesale-services/connectivity/submarine-terrestrial-cable

'a bit of improvement but will it be good enough to make enough profit to cover the dividends?'
At Q1 Vod confirmed full year guidance so, keeping it simple, i am looking for the same in Q2, 16 Nov and confirmation of the interim dividend.

GLA

'A lot of money appears to be directed at Leo's, but the technological solutions seem to fall into the category of "to complicated", in my opinion.'
Yes, the various interest groups able to move alot of money in the capital markets, investment memorandums etc. Build and go live is completely different.

Always dreamed of running a space hotel and off planet financial services in a lagrange point. Could bolt a station on the side of that for a monthly fee. LoL

'i just hope we get better results here next month'
Me too. Q1 was good. Verizon moving forward with good performance and possibly a bell weather for wider economic uplift.

I am also trying to teach myself TA. The weekly candle has the look of a spinning top or imperfect high wave candle. 'Often the 1st sign of a reversal and a change in momentum.' RSI also hard to call if it wants to go 30 or its gone far enough?
https://invst.ly/we9hv

AIMO and still learning so happy to take any insights

'Has VOD improved financially or has it gone poorer?'
Depends if you believe the management. Is the difference a recurring cost, if so, what is it? If it is not recurring then its not a sustainability issue. For example, reduction in capex, no more spend in India. What are the big capex spends that are continuing. Network costs are lower etc

'I used to be sceptical that the model would work at all, but I can see work arounds for most of the operational problems, but at what cost? '
I am a bit out of date but recall a LEO constellations could generate multiple tax costs depending where the ground earth stations are location. Would depend on double taxation treaties/ interconnect etc and is currently topical for global corporate tech giants paying 15% corporation tax where a service is provided

I recall Irridium passed traffic between the satellites to avoid a ground earth station triggering a tax prescence.

No offence taken. Here is the detail. See Q1 spreadsheet on the link.
Have a look at cashflow, debt reduction etc. I would ignore historic non recurring costs. I use cash as proxy for current and potential future cashflows, not historic cost accounting. Vantage towers network economic cost is not the same as the historic of building towers as the cost is shared. Spain retail shops not required etc
Free cash flow (pre spectrum, restructuring and integration costs) €15.019 Bn
Licence and spectrum payments (1,221)
Restructuring and integration payments (421)
Integration capital expenditure (267)
Free cash flow 3,110
Acquisitions and disposals 447
Equity dividends paid (2,427)
Share buybacks (53)
Foreign exchange (loss)/gain (219)
Other movements on net debt 646
Net debt decrease/(increase) 1,504
Opening net debt (42,047)
Closing net debt (40,543)
https://investors.vodafone.com/reports-information/results-reports-presentations

*25m typo

Vod is producing Free cash flow (pre spectrum, restructuring and integration costs) c.€15Bn pa.
imo is sufficient to pay down debt as required, recently rolled debt fixed at 1.5% out for 60 years (and interest rates might rise), pay 7% div, pay interest est. €1.55Bn net, paying taxes, investing capex, creating vantage asset, m-pesa product growth, 78m marketable homes passed in Europe, organic service revenue growth, 300m diverse mobile subscribers, 25 fixed broadband customers, 20m TV and fixed line voice customers, 7m converged customers in consumer, 3.2m terrabytes data usage.

Lots of facts and no exaggeration!

Mikey, 'heres to another week '
We finished higher than last week, just! Slowly turning imo

Thank you Mole, Cesna

'the next bond converts in March '22. Approx 1.5bn shares will then be issued causing approx 5% dilution again.'

Is the 2nd tranche likely to be bought back in the same way as the 1st tranche.
I can see in June RNS, 'Vodafone has generated net proceeds of U.S.$2,432,850,000 from the sale of the hybrid securities. Vodafone intends to use these net proceeds for general corporate purposes, which may include funding repurchases of ordinary shares issued in connection with the £1,720,000,000 1.50% Subordinated Mandatory Convertible Bonds due 2022.'

Mole, thanks.
'get share float back to March '21 level'

At 1st April, the total number of voting rights in Vodafone was 28,224,193,469.

At 1st October, the total number of voting rights in Vodafone was 27,540,979,833.

If there was dilution, wouldnt the total increase, not decrease?

Still trying to understand this..