It also aims to more than triple operating free cash flow at VodafoneThree by fiscal 2032
By Adrià Calatayud
Vodafone Group is dialing up its cost-savings target for its U.K. unit VodafoneThree, saying it expects the business to be a key driver of the group's midterm ambitions.
The U.K. telecommunications group said Thursday that it now expects annual cost savings at VodafoneThree to reach 1 billion pounds ($1.32 billion) by the year ending in March 2032, up from a previous target of 700 million pounds by fiscal 2030.
Vodafone also said it expects the unit's adjusted earnings before interest, taxes, depreciation and amortization after leases -- a key profitability metric in the telecom industry -- to grow by mid-to-high single percentage digits annually between fiscal 2025 and fiscal 2032.
It also aims to more than triple operating free cash flow at VodafoneThree by fiscal 2032 relative to a fiscal 2025 baseline.
The group took full ownership of VodafoneThree in July after completing the buyout of the 49% stake held by former partner CK Hutchison Group Telecom Holding for 4.3 billion pounds. Vodafone and CK formed the business last year by merging their respective Vodafone UK and Three UK units.
The business maintained good commercial momentum after the merger and Vodafone sees it as a driver of a group-wide midterm goal of reaching double-digit organic growth in adjusted free cash flow, it said.