Interim Results - Part 2

Vodafone Group Plc
18 November 2003

VODAFONE GROUP PLC 
INTERIM RESULTS
PART 2

Data revenue as a percentage of service revenue, for the year ended 30 September
2003, increased to 15.0% compared with 14.4% for the year ended March 2003, due
to ongoing take-up by customers of the full range of available data products and
services and continued growth in SMS messaging. This has partly been driven by
Vodafone live! which now has over 710,000 UK customers.

At 30 September 2003, Vodafone UK had 13,483,000 registered customers, with
contract customers representing 41% of the total base. Acquisition and retention
costs have increased as a result of additional incentives to grow market share.
Vodafone UK has consolidated its market position through the acquisition of the
service providers Singlepoint and Project Telecom, who had a combined total of
approximately 1.6 million customers on the Vodafone network at the period end.

The UK business continues to invest in high value customers and increased
customer retention, supported by the recent launch of Vodafone's membership of
the Nectar loyalty programme. In a recent market survey, Vodafone UK continued
to rank first in terms of customer satisfaction in the prepaid market and
increased customer satisfaction in the contract segment. Blended churn for the
twelve months to 30 September 2003 decreased when compared to the twelve months
to 31 March 2003, with prepaid churn falling from 34.5% to 33.2% partially
offset by a rise in contract churn from 23.1% to 23.7%. The proportion of active
customers was maintained at 91%.

On 24 July 2003, Vodafone UK reduced its termination charges by RPI minus 15%
(on the weighted average charge for the previous year) to comply with its
licence requirements. This reduction implemented the decision of the Competition
Commission in January 2003. Oftel is required to conduct a market review of call
termination under the new EC regulatory framework brought into force on 25 July
2003. Oftel has proposed a further cut in termination charges in this financial
year and in each of the following two financial years. This review is currently
in progress and is expected to take until early 2004 to complete.

The EBITDA margin fell as operating efficiencies were more than offset by
increased acquisition and retention costs, the reduction in termination rates
and costs associated with Cellular Operations which was acquired at the end of
the previous financial year. Vodafone UK is also experiencing the effect of
increasingly competitive offnet prices in the UK market.


Ireland

Vodafone Ireland's turnover increased by 13% when measured in local currency and
operating profit before goodwill amortisation increased by 25% when measured in
local currency. Turnover benefited from blended ARPU growth of 4%, in part as a
result of strong growth in data revenues, which improved to represent 20.1% of
service revenues for the year ended 30 September 2003.

Vodafone Ireland successfully met Phase 1 of its 3G licence obligation on 1 May
2003 and maintained its leadership with an approximate market share of 55% and a
closing customer base of 1,803,000.

Northern Europe

Financial highlights                          Six months to         % change
                                              30 September
                                          2003            2002
                                            £m              £m      £     €(4)
Turnover        Germany:
                - Voice services         2,099           1,784     18       6
                - Data services            438             345     27      15
                                        ------          ------
                - Total service
                  revenue                2,537           2,129     19       8
                - Equipment and
                  other                    171             122     40      26
                                        ------          ------
                                         2,708           2,251     20       9

                Other Northern 
                Europe                     968             738     31
                                        ------          ------
                                         3,676           2,989     23
                                        ------          ------
Total Group     Germany                    911             775     18       3
operating
profit(1)       Other Northern
                Europe                     778             536     45
                                        ------          ------
                                         1,689           1,311     29
                                        ------          ------

Proportionate   Germany                   46.7%           46.2%
EBITDA
margin(2)       Other Northern
                Europe                    41.1%           40.4%

Key performance indicators (Germany only)

ARPU(3)                                   €312            €313

Churn(3)                                  19.1%           21.2%

Acquisition and retention costs
net of equipment revenues, as a
percentage of service revenues            12.4%           10.3%

(1)  before goodwill amortisation
(2)  see pages 31 and 32 for details of proportionate turnover and EBITDA
(3)  ARPU and churn information represents the twelve month periods ended 30
     September 2003 and 31 March 2003, respectively
(4)  local currency percentage change excluding any Group allocations

Germany

Vodafone Germany performed well in the period, increasing turnover and operating
profit before goodwill amortisation in a highly competitive market where
penetration levels climbed to 74% by the end of June. Vodafone Germany continues
to be the second largest operator by customers with an estimated 38% share of
the market at 30 June 2003.

Statutory turnover increased principally as a result of service revenue growth,
driven by a larger customer base, which has increased by 840,000 customers to
23,780,000 at 30 September 2003.

Blended ARPU, for the year ended 30 September 2003, was stable when compared to
the year ended 31 March 2003. Contract ARPU decreased from €519 to €502 due to
the level of new, lower spending, contract customers, while prepaid ARPU
remained stable at €130.

Revenue growth benefited from focus on the acquisition and retention of contract
customers, which accounted for 76% of the net additions in the period. This
increased the proportion of contract customers within the total customer base to
48% from 47% over the six months ended 30 September 2003.

Data revenues represented 17.0% of service revenues for the twelve months ended
30 September 2003, compared to 16.4% for the twelve months ended 31 March 2003,
as a result of improved service offerings including Vodafone live!, which now
has over 1 million customers in Germany.

Activity levels remained unchanged at 92% and blended churn decreased following
a decrease in prepaid churn from 24.8% for the twelve month period ended 31
March 2003 to 20.6%, partially offset by an increase in contract churn from
16.8% to 17.4%.

The growth in operating profit before goodwill amortisation was affected by a
higher depreciation charge in the six months to 30 September 2003 than in the
comparable period, arising from increased investment in the network. In
addition, acquisition and retention costs net of equipment revenues increased to
12.4% of service revenues as a result of the high volume of upgrades and gross
contract connections.

In May 2003, Vodafone Germany became the first operator in Germany to enable
customers to download video clips. In addition, MMS services and content on
Vodafone live! have continued to be extended.

Vodafone Germany's 3G network infrastructure rollout is proceeding according to
plan and in accordance with the licence obligation to provide at least 25%
population coverage by the end of the calendar year 2003. Vodafone Germany
successfully performed call handover between its pilot 3G and 2G networks during
the period.

Other Northern Europe

The Group's other operations in the Northern Europe region experienced good
growth, with proportionate customers increasing by 6% to 14,844,000 in the
period, including the effect of stake increases in the Netherlands, from 97.2%
to 99.8%, and Hungary, from 83.8% to 87.9%.

The increase in statutory turnover for these operations was primarily as a
result of a combination of customer growth and enhanced usage. In the
Netherlands, an 11% increase in revenues when measured in local currency was
driven by both increases in data service usage and revenue, which increased by
37%, and a 3% increase in the customer base. Customer numbers in Sweden and
Hungary also grew, by 4% and 27% respectively, increasing revenues in these
countries.

Turnover growth translated into improved operating profit before goodwill
amortisation in the Netherlands, although EBITDA margins decreased slightly due
to higher net acquisition and retention costs. In Sweden, operating expenses
increased significantly as a result of the cost of fulfilling 3G licence
obligations in relation to population coverage, which led to a decrease in
operating profit before goodwill amortisation.

The Group's associated companies in the Northern Europe region also performed
well in the period. SFR, in which the Group increased its effective stake from
31.9% to 43.9% in the second half of the previous financial year, reported a
strong financial performance, with revenue increasing strongly as a result of a
3% increase in the customer base to 13,770,000 and broadly stable ARPU. The
Group's share of operating profit before goodwill amortisation of SFR grew
strongly as a result of the increased revenues, focus on cost effectiveness
measures and the stake increase.

Proximus, Polkomtel and Swisscom Mobile, which operate in Belgium, Poland and
Switzerland, respectively, also generated growth in both turnover and operating
profit before goodwill amortisation in the period.

Since 31 March 2003, Partner Network Agreements have been signed with
Og-Vodafone (formerly Islandssimi hf) in Iceland and Bite GSM in Lithuania.

Southern Europe

Financial highlights                      Six months to           % change
                                           30 September
                                       2003           2002
                                         £m             £m        £      €(4)
Turnover       Italy:
               - Voice services       2,191          1,774       24       11
               - Data services          312            208       50       35
                                     ------         ------
               - Total service
                 revenue              2,503          1,982       26       14
               - Equipment and
                 other                  109            104        5       (6)
                                     ------         ------
                                      2,612          2,086       25       13
               Other Southern
               Europe                 2,223          1,791       24
                                     ------         ------
                                      4,835          3,877       25
                                     ------         ------
Total Group
operating      Italy                  1,113            777       43       27
profit(1)      Other Southern
               Europe                   616            484       27
                                     ------         ------
                                      1,729          1,261       37
                                     ------         ------

Proportionate  Italy                   54.8%          49.4%
EBITDA         Other Southern
margin(2)      Europe                  38.6%          37.1%

Key performance indicators (Italy only)

ARPU(3)                                €355           €347

Churn(3)                               17.2%          17.3%

Acquisition and retention costs
net of equipment revenues, as a
percentage of service revenues          2.6%           3.5%

(1)  before goodwill amortisation and exceptional items
(2)  see pages 31 and 32 for details of proportionate turnover and EBITDA
(3)  ARPU and churn information represents the twelve month periods ended
     30 September 2003 and 31 March 2003, respectively
(4)  local currency percentage change excluding any Group allocations

Italy

Notwithstanding high penetration levels in the Italian market and strong
competition, including that arising as a result of the introduction of a new
competitor at the end of the previous financial year, Vodafone Italy continues
to capture market share and produce excellent results.

In local currency, statutory turnover increased by 13%, driven by a 14% increase
in service revenues, arising from growth in the customer base and ARPU,
partially offset by a 6% decrease in equipment revenues as a result of reduced
handset sales. Data service revenues increased by 35% driven by a 32% increase
in SMS messaging revenues and a 126% increase in other data revenues. Data
revenues represented 12.2% of service revenues during the year ended 30
September 2003, compared to 11.3% in the year ended 31 March 2003.

At 30 September 2003, Vodafone Italy's customer base stood at 19,982,000,
representing an increase of 3% since 31 March 2003, primarily as a result of
successful promotional campaigns. Vodafone Italy has maintained its leadership
in overall customer satisfaction and has notably come first in terms of tariff
satisfaction in recent surveys. Blended churn reduced slightly despite the entry
of a new competitor into the market, mainly as a result of the success of the
Vodafone One loyalty programme and other focused customer base management
activities. Prepaid customers continue to represent 92% of the customer base.

The rise in blended ARPU is mainly attributable to an increase in prepaid ARPU
from €298 for the year ended 31 March 2003 to €304 for the year ended 30
September 2003. Contract ARPU grew from €818 in the year ended 31 March 2003 to
€853 for the year ended 30 September 2003, as a result of a selective customer
acquisition and retention policy targeting high value customers.

In local currency, operating profit before goodwill amortisation and exceptional
items grew by 27%, reflecting both the growth in service revenues and an
excellent EBITDA margin. The EBITDA margin for the six months to 30 September
2003 benefited by 1.4 percentage points as a result of no accrual being made for
a contribution tax levied by the local regulatory authority following a
favourable European Court of Justice ruling on its legality.

Brand awareness has improved since the introduction of the single Vodafone brand
in May 2003 and the launch of Vodafone live! in October 2002, which has
attracted over 430,000 customers since launch.

Other Southern Europe

Proportionate customers for the Group's other operations in the Southern Europe
region increased by 7% during the period, including an increase of 1.7
percentage points arising from stake changes in the Group's operations in
Portugal, Greece, Albania and Malta.

Vodafone Spain's turnover for the six months ended 30 September 2003 increased
by 23% to £1,286 million (12% when measured in local currency) as a result of an
increase in the customer base and strong voice and data usage which more than
offset a negative impact of a reduction in the intercarrier rate in November
2002. The EBITDA margin improved, benefiting from reduced acquisition and
retention costs.

Turnover increased in all of the region's other markets. In Portugal, turnover
increased by 5% in local currency, including a 41% increase in data revenues
as a result of Vodafone live! and an MMS bulk offering. Vodafone Portugal was
among the first companies in Europe to offer video MMS services.

AMERICAS

Financial highlights                       Six months to            % change
                                            30 September
                                       2003           2002
                                         £m             £m           £     $(4)

Total Group      Verizon Wireless       712            653           9      16
operating        Other Americas          (7)            (9)        (22)
profit/(loss)(1)                     -------        -------
                                        705            644           9
                                     -------        -------

Proportionate    Verizon Wireless     3,102          2,841           9      17
turnover(2)      Other Americas          31             66         (53)
                                     -------        -------
                                      3,133          2,907           8
                                     -------        -------

Proportionate    Verizon Wireless      35.7%          35.3%
EBITDA           Other Americas         6.5%          12.1%
margin(2)


Key performance indicators (Verizon Wireless only)

ARPU(3)                                $593           $584

Churn(3)                               23.2%          26.5%

Acquisition and retention costs net
of equipment revenues, as a
percentage of service revenues         13.7%          13.1%

(1)  before goodwill amortisation
(2)  see pages 31 and 32 for details of proportionate EBITDA
(3)  ARPU and churn information represents the twelve month periods ended 30
     September 2003 and 31 March 2003, respectively
(4)  local currency percentage change excluding any Group allocations


Verizon Wireless

Within the highly competitive US market, Verizon Wireless continues to
outperform its competitors and ranked first in customer net additions for the
six months ended 30 September 2003, further increasing its lead over the number
two provider. At 30 September 2003, Verizon Wireless' total customer base stood
at 36,026,000, an 8% increase on 31 March 2003. At 30 June 2003, US market
penetration had reached approximately 51%, with Verizon Wireless' market share
at approximately 24%.

The increase in proportionate turnover was primarily due to increased service
revenue from the larger customer base and higher ARPU. Data revenues for the six
months to 30 September 2003 increased by 152% over the comparable period and
have been positively affected by the growth of data products, including 'Get It
Now', and picture messaging. Approximately 28% of the customer base is actively
using a data or SMS product compared to 19% at 31 March 2003. Blended ARPU
increased slightly due to a focus on selling plans with higher access price
points, for which Verizon Wireless incurred a slightly higher average cost to
connect.

Churn decreased due to a reduction in contract churn, attributable to a
combination of the quality of Verizon Wireless' network and customer
satisfaction, which have ranked highest in a number of external surveys, the
success of retention programmes and the adverse effect of MCI's withdrawal from
the wholesale market during the year ended 31 March 2003.

The proportionate EBITDA margin increased from 35.3% to 35.7% principally as a
result of increased cost efficiencies. This was partially offset by increased
acquisition and retention costs, net of equipment revenues, as a percentage of
service revenues resulting from increased gross additions and upgrade
activities.

The Group's share of Verizon Wireless' operating profit before goodwill
amortisation increased by 16%, in local currency, for the six months to 30
September 2003 as a result of the turnover and EBITDA margin performance,
partially offset by a 21% increase in the charge for depreciation. The higher
depreciation charge arose from the level of capital expenditure incurred to
increase network capacity to the levels necessary to satisfy the demands placed
on it through increased usage, a larger customer base and the upgrade to 1xRTT,
which now covers virtually all of Verizon Wireless' coast-to-coast network.

On 23 May 2003, Verizon Wireless completed a transaction with Northcoast
Communications L.L.C., to purchase 50 Personal Communications ('PCS') licences
and related network assets for approximately $762 million in cash. The PCS
licences cover large portions of the East Coast and Midwest, serving
approximately 47 million people.

As part of a broader collaboration, on 1 August 2003, the Group and Verizon
Wireless announced their intention to develop a dual branded 'Verizon Vodafone'
laptop data card service for business customers working and travelling between
the US and Europe. The data card will be based on Vodafone's data card service,
Vodafone Mobile Connect Card, which Verizon Wireless will develop and market
under licence from Vodafone. In addition, Vodafone and Verizon Wireless are
working together on joint global contracts for content, international account
management, SMS messaging between the CDMA and GSM networks of Verizon Wireless
and Vodafone, as well as ongoing best practice sharing.

Verizon Wireless continues to expand its product base, with the launch during
the period of a new walkie-talkie product called 'Push to Talk', a picture
messaging service to complement its 'Get It Now' data product and a selected
Wireless LAN service that enables high speed wireless data service coverage in a
number of travel-related venues such as hotels and airports.

The Federal Communications Commission has set 24 November 2003 as the start date
for wireless local number portability compliance.

Other Americas

On 29 July 2003, the Group completed the disposal of its stake in the Mexican
mobile operator Grupo Iusacell.

ASIA PACIFIC

Financial highlights                  Six months to                % change
                                       30 September
                                   2003           2002
                                     £m             £m           £        Y(4)
Turnover       Japan:
               - Voice services   2,462          2,415           2           5
               - Data services      680            585          16          19
                                 ------         ------
               - Total
                 service revenue  3,142          3,000           5           8
               - Equipment
                 and other          727            731          (1)          1
                                 ------         ------
                                  3,869          3,731           4           6
               Other Asia
               Pacific              488            395          24
                                 ------         ------
                                  4,357          4,126           6
                                 ------         ------

Total Group    Japan                672            696          (3)         (1)
operating      Other Asia
profit(1)      Pacific               64             38          68
                                 ------         ------
                                    736            734           -
                                 ------         ------

Proportionate  Japan               32.4%          32.0%
EBITDA         Other Asia
margin(2)      Pacific             38.5%          37.8%


Key performance indicators (Japan only)

ARPU(3)                         Y84,818        Y87,159

Churn(3)                           23.4%          23.3%

Acquisition and retention
costs net of equipment
revenues, as a percentage of
service revenues                   18.1%          20.0%

(1)  before goodwill amortisation
(2)  see pages 31 and 32 for details of proportionate turnover and EBITDA
(3)  ARPU and churn information represents the twelve month periods ended 30
     September 2003 and 31 March 2003, respectively
(4)  local currency percentage change excluding any Group allocations

Japan

Japan's mobile telecommunications market remained robust as mobile services
continued to expand, driven by the roll out of high speed 3G and other data
services. Market penetration increased by three percentage points to 62% at 30
September 2003, compared to 59% at 31 March 2003.

Vodafone Japan's market share improved marginally from 18.5% to 18.6% in the
period, with net additions of 628,000 resulting in period end customers of
14,540,000. The key drivers of this growth have been the continued success of
J-Sky services, which have now been rebranded as Vodafone live! services, and
the new prepaid offering, launched in February 2003. In addition, in May 2003
Vodafone Japan launched the popular J-SH53 handset, which was the world's first
megapixel camera phone. However, customer growth has slowed in the last quarter
and Vodafone Japan has captured a significantly reduced level of the total
market net additions as a result of its competitors offering a wider and more
attractive range of handsets and price plans. In line with the adoption of the
single Vodafone brand on 1 October 2003, Vodafone Japan prepared a range of
measures, including new price plans, handsets and services, to ensure a
successful brand launch associated with value to the customer and targeted at
stimulating growth in net connections.

Turnover for Vodafone Japan increased by 6% in local currency over the
comparable period, primarily driven by service revenue growth. Vodafone Japan
continues to have the highest ARPU in the Group and, although ARPU declined as
expected, data and content revenues continued to increase.

Net acquisition costs decreased due to more cost efficient purchasing and
increased prepaid connections. In addition, Vodafone Japan has continued to
streamline operations in areas such as customer care, logistics and billing
system management. In April 2003, Vodafone Japan opened a new customer service
centre, consolidating the service centres in eastern Japan so as to reduce
overall operating costs and improve service levels. These benefits were
partially offset by an increase in provisions for slow moving handset stocks and
incremental overheads in operating the 3G network. The EBITDA margin increased
slightly to 32.4% for the six month period ended 30 September 2003. Operating
profit before goodwill amortisation decreased, principally due to a £58 million
increase in the depreciation charge as a result of the commencement of 3G
commercial services.

Vodafone Japan launched 3G services in December 2002 and has expanded its 3G
network to 11,300 operational 3G base stations covering 95.9% of the population
at 30 September 2003. 3G growth is expected to continue with the launch of
Vodafone branded products and services. International roaming services, enabled
by the launch of the W-CDMA 3G network, also increased significantly, with voice
roaming services available in 81 countries and regions using 116 operators at 30
September 2003.

Other Asia Pacific

In an intensely competitive environment, Vodafone Australia increased its
customer base by 2% in the six months ended 30 September 2003, notwithstanding
heavy subsidisation of handsets by competitors. The contract base declined by 5%
but the prepaid base increased by 9%, helped by new service offerings. Early
September 2003 saw the launch of 'red SIM', a new mass market proposition
supported by an integrated brand campaign designed to raise the profile of the
business in the Australian market place.

Compared to the same period last year, turnover and EBITDA increased as a result
of the growth in the customer base. Blended ARPU declined from AUD633 to AUD587
compared to the year ended 31 March 2003 as a result of the continued change in
base from access-based plans with subsidies, to non-subsidised plans with no
access fees. Data revenues increased by 39% compared to the same period last
year, from increased SMS volumes, use of WAP browsing services and Vodafone
live! customers.

Vodafone New Zealand continued to grow both turnover and EBITDA margins compared
to the same period last year. Blended ARPU increased to NZD665 from NZD663
compared to the year ended 31 March 2003. The business has continued to focus on
controlling operating expenditure while maintaining revenue growth. Customers
increased by 11% since 31 March 2003 to 1,429,000 customers.

China Mobile (Hong Kong) Limited, in which the Group has a 3.27% stake,
increased its customer base by 9% to 135,001,000 in the six months to 30
September 2003. This growth in the period was despite a slowdown in April and
May due to the outbreak of Severe Acute Respiratory Syndrome. ARPU fell as
competition increased, particularly at the low end of the market, driven by the
limited mobility PHS service rolled out nationwide by China's fixed-line
operators. SMS volumes increased by 57% to 48.4 billion messages sent in the six
months ended 30 September 2003 compared to 30.8 billion in the six months ended
31 March 2003.

The Group disposed of its interest in its Indian associate, RPG Cellular
Services Ltd, during the period.

A new Partner Network Agreement was announced with M1 in Singapore on 3 November
2003, being the first Vodafone partner in this region.

MIDDLE EAST AND AFRICA

Financial highlights                         Six months to
                                              30 September
                                             2003       2002          % change
                                               £m         £m

Turnover                                      157        143                10

Total Group operating profit(1)               140         88                59

Proportionate EBITDA margin(2)               48.3%      45.8%

(1)  before goodwill amortisation
(2)  see pages 31 and 32 for details of proportionate turnover and EBITDA

The Group's operations in the Middle East and Africa region comprise Vodafone
Egypt and the Group's associated companies in South Africa (Vodacom) and Kenya
(Safaricom). In addition, the Group has a Partner Network Agreement with
MTC-Vodafone, which is the one of the leading mobile operators in Kuwait.









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