Vodafone Incurs 41.1 Billion in Losses from 2005

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While a regular dude would be living on the street, maybe even a small coutnry, Vodafone Group posted a massive $41.1 billion loss for 2005 but promised its investors an even larger than expected payout.

Excluding the asset impairment charge, the European-based operator’s revenues witnessed 7.5-percent organic growth and Vodafone added 21.5 million proportional customers during the past year. The company promised to return $17 billion to its shareholders, one-third more than had already been promised.

Vodafone still has plans to cut costs including outsourcing its information technology application development and maintenance activities, regional consolidation of its data centers and cutting more than 400 jobs.

In outlining its strategy, Vodafone indicated that it expected to increasingly rely on emerging markets for its growth, since wireless penetration is lower in developing countries than in much of Europe. The company also said that it will “[dispose] of assets where it believes it cannot earn a superior return” and that it anticipates a “lower level of merger and acquisition activity in the future.” New acquisitions won’t be considered unless they can provide a return within three to five years and must help Vodafone consolidate its presence in a local or regional market, the operator said.

The response the next day was a re-assesment of their strategy... if you re-do strategy you probably didn't know what you were doing in the first place.