Interim Results - Part 2

Vodafone Group Plc
16 November 2004


Vodafone Group Interim Results
For the six months ended 30 September 2004
PART 2


MOBILE TELECOMMUNICATIONS - REGIONAL REVIEW

In October 2004, the Group announced changes to the regional structure of its
operations, effective from 1 January 2005. The following results are presented
in accordance with the current regional structure. Proforma segmental results
for the new structure are provided on page 42. The preliminary results
announcement and Annual Report for the year ending 31 March 2005 will reflect
the new regional structure.

UNITED KINGDOM AND IRELAND

Financial highlights                     Six months to 30 September
--------------------                                 2004      2003   % change
                                                       £m        £m

Turnover        United Kingdom(1)                   2,563     2,167         18
                Ireland                               406       383          6
                Less: intra-segment turnover           (9)       (7)
                                                   -------   -------
                                                    2,960     2,543         16
                                                    ------   -------
Total Group
operating       United Kingdom                        491       549        (11)
profit(2)       Ireland                               146       136          7
                                                    ------   -------
                                                      637       685         (7)
                                                    ------   -------

United Kingdom
--------------

Trading
results         Voice services                      1,879     1,718          9
                Non-voice services                    404       302         34
                                                    ------   -------
                Total service revenue               2,283     2,020         13
                Other revenue(1)                       94        19
                Other direct costs                   (189)     (112)        69
                Interconnect costs                   (410)     (380)         8
                Net acquisition costs(1)             (186)     (117)        59
                Net retention costs(1)               (198)     (147)        35
                Payroll                              (201)     (198)         2
                Other operating expenses             (339)     (299)        13
                Depreciation and amortisation(2)     (363)     (237)        53
                                                    ------   -------
                Total Group operating profit(2)       491       549        (11)
                                                    ------   -------
                EBITDA margin                        33.3%     36.3%

KPIs            Closing Customers ('000)           14,600    13,483          8
                Average monthly ARPU                £26.6     £25.1          6

(1) Turnover for UK includes revenue of £186 million (2003: £128 million) which
    has been excluded from other revenue and deducted from acquisition and 
    retention costs in the trading results
(2) Before goodwill amortisation
See page 37 for definition of terms

United Kingdom

The United Kingdom market continued to be one of the most competitive in which
Vodafone operates in Europe. Nevertheless, Vodafone has been successful in
attracting high value customers through differentiated products, service quality
and network performance.

Turnover increased by 18% to £2,563 million, comprising underlying growth of 7%
and the effect of the acquisition of a number of service providers in the prior
year, including Singlepoint (4U) Limited, which contributed growth of 11%.
Growth in voice revenue resulted from an increase of 7% in the average number of
customers for the six months ended 30 September 2004 compared to the prior
period and the impact of service provider acquisitions. Non-voice revenue
improved to 17.7% of service revenue for the six months ended 30 September 2004
compared to 15.0% for the prior period as usage levels of messaging and other
non-voice offerings, including Vodafone live!, Vodafone Mobile Connect datacards
and BlackBerry from Vodafone devices, increased. The number of Vodafone live!
customers grew to 2,403,000 at 30 September 2004.

Average monthly ARPU increased compared to the prior period, driven by growth in
contract ARPU. The increase was primarily due to rising non-voice revenue and
the impact of service provider acquisitions in the prior year.

Registered customers increased by 4% over the six month period to 14,600,000,
compared to 1% in the six month period to 30 September 2003, demonstrating
Vodafone UK's increased focus on acquisition and retention activities and the
success of new tariffs and services for the corporate and business segments. The
contract customer base was maintained at 40% of total registered customers.

In September 2004, Vodafone UK, along with the other mobile network operators,
excluding the third generation operator, reduced its termination charges by
approximately 30% following the publication by OFCOM, the national regulator, in
June 2004 of its 'Statement on Wholesale Mobile Voice Call Termination'. The
current regulation extends to 31 March 2006 and no further reduction in
termination rates is anticipated during this period.

During the period an agreement was reached to provide wholesale services to BT
and at the end of September 2004, 5,000 BT customers were connected to the
Vodafone network under this agreement.

The UK EBITDA margin fell by 3.0 percentage points to 33.3% compared to the six
months to 30 September 2003. This is a result of increased investment in
acquisition and retention activity, leading to higher levels of customer
additions and equipment upgrades, and also the impact of the service provider
acquisitions, which included lower margin non-Vodafone customers. These effects
are partially offset by reduced payroll costs as a percentage of turnover
following the restructuring programme announced in the second half of the
previous financial year. The EBITDA margin in the current period has improved by
1.9 percentage points from the second half of the previous financial year.
Vodafone UK has launched and is executing a structured plan to drive revenue and
margin growth. The key elements of this plan are to sustainably differentiate
and segment the customer base allowing more effective targeted marketing, a
drive to lower costs and to position the organisation for the future. Under the
drive to lower costs, Vodafone UK is continuing to consolidate and simplify its
network and customer service operations. Support costs are also expected to be
reduced. The full benefits from this programme are expected to be realised over
a number of years.

Other revenue and other direct costs have both increased as a result of
non-Vodafone customers acquired as part of service provider acquisitions in the
prior year.

Operating profit before goodwill amortisation was impacted by the factors above
and by an increase in both depreciation and licence amortisation charges,
primarily due to the commencement of 3G services towards the end of the previous
financial year.

Ireland

Vodafone Ireland's turnover increased by 11% when measured in local currency,
benefiting from an increasing customer base and strong growth in voice usage.
Non-voice revenue as a percentage of service revenue was 20.0% for the six
months ended 30 September 2004. Average monthly ARPU grew from €49.2 for the six
months ended 30 September 2003 to €51.4 for the six months ended 30 September
2004, predominantly a result of growth in voice revenue as Ireland continued to
have the highest level of outgoing voice usage per customer in the Group's
controlled mobile businesses. Operating profit before goodwill amortisation
increased by 13% in local currency, principally driven by the increased turnover
combined with improvements in operating efficiency.

Vodafone Ireland successfully maintained its market leadership with an
approximate market share of 54% for the quarter ended 30 June 2004 and a closing
customer base at 30 September 2004 of 1,890,000.

NORTHERN EUROPE

Financial highlights          Six months to 30 September
--------------------                 2004           2003               % change
                                       £m             £m          £           €

Turnover    Germany(1)              2,808          2,773          1           6
            Other Northern Europe     993            988          1
            Less: intra-segment
            turnover                  (23)           (18)
                                    ------         ------
                                    3,778          3,743          1
                                    ------         ------
Total Group
operating   Germany                   876            911         (4)          1
profit(2)   Other Northern Europe     771            778         (1)
                                    ------         ------
                                    1,647          1,689         (2)
                                    ------         ------
Germany
-------

Trading
results     Voice services          2,185          2,163          1           6
            Non-voice services        451            438          3           8
                                    ------         ------
            Total service
            revenue                 2,636          2,601          1           6
            Other revenue(1)           69             63         10          16
            Other direct costs       (158)          (162)        (2)          1
            Interconnect costs       (377)          (383)        (2)          3
            Net acquisition
            costs(1)                 (166)          (166)         -           5
            Net retention
            costs(1)                 (157)          (157)         -           5
            Payroll                  (198)          (193)         3           7
            Other operating          
            expenses                 (331)          (339)        (2)          2
            Depreciation and         
            amortisation(2)          (442)          (353)        25          31
                                    ------         ------
            Total Group
            operating profit(2)       876            911         (4)          1
                                    ------         ------

            EBITDA margin            46.9%          45.6%

KPIs        Closing Customers      
            ('000)                 26,092         23,780                     10
            Average monthly         
            ARPU                    €25.7          €26.6                     (3)

(1) Turnover for Germany includes revenue of £103 million (2003: £109 million) 
    which has been excluded from other revenue and deducted from acquisition 
    and retention costs in the trading results
(2) Before goodwill amortisation
See page 37 for definition of terms

Germany

Vodafone is well positioned in the German mobile market. Its customer base
represented 38% of the market as of 30 June 2004, and, together with the
incumbent operator which has a slightly higher market share, is significantly
ahead of the other two operators. Profitability, in local currency, has improved
and Vodafone Germany's EBITDA margin represents the highest in the market.

The average customer base for the period increased by 9%, compared to the six
months to 30 September 2003, driving the 6% growth in service revenue in local
currency. Customer growth has been a result of the success of competitively
priced offerings such as partner cards, which offer a second SIM card without a
handset to contract customers at a low monthly cost to the customer. For prepaid
customers, connection fees have been reduced. Vodafone Germany benefits from
lower than average subsidies on both of these plans, although partner cards have
had a dilutive effect on contract ARPU. Contract bundles, first introduced in
March 2004 and aimed at acquiring higher value customers, have been successful
in reducing this dilutive effect. Prepaid ARPU has also reduced following a rise
in the number of lower spending customers and a fall in activity level.

Non-voice revenue increased by 8% compared to the six months ended 30 September
2003, as a marginal decline in messaging revenue and usage was offset by an 83%
increase in revenue from the Group's other data offerings, primarily Vodafone
live! in the consumer segment and Vodafone Mobile Connect datacards in the
business segment. Non-voice revenue represented 17.1% of service revenue for the
period compared to 16.8% for the six months ended 30 September 2003. Vodafone
Germany became the first operator in the country to offer 3G services in May
2004. The number of Vodafone live! customers increased to 3,570,000 customers at
30 September 2004.

Control over costs has improved EBITDA margin by 1.3 percentage points over the
comparable period to 46.9%. A higher proportion of prepaid additions and lower
contract subsidies, as discussed above, led to net acquisition costs increasing
5% in local currency in spite of a 10% increase in gross customer additions.
Lower loyalty scheme costs had a similar effect on net retention costs, which
increased 5% in local currency on a 10% increase in gross upgrades. Other costs
remained relatively stable compared to the six months ended 30 September 2003.

The commencement of depreciation and amortisation on the 3G network and licence,
following launch of services in the second half of the previous financial year,
impacted operating profit before goodwill amortisation, with the licence
amortisation representing the largest share of this increase.

Vodafone Germany has agreed to reduce its mobile call termination rate with
Deutsche Telekom for incoming calls from Deutsche Telekom fixed lines by 23%
over two years, from 14.3 eurocents per minute to 13.2 eurocents in December
2004 and to 11.0 eurocents in December 2005, subject to regulatory approval.

Other Northern Europe

Proportionate customers for the Group's other operations in the Northern Europe
region increased by 6% in the six month period to 30 September 2004.

Turnover increased marginally in spite of the strengthening of Sterling against
local currencies. Vodafone Netherlands and Vodafone Sweden reported stable
turnover when measured in local currency despite competitive pressures on
pricing and imposed termination rate reductions. Vodafone Hungary continued to
grow strongly, increasing turnover by 38% in local currency, as a result of an
ARPU uplift and an enlarged customer base.

Operating profit before goodwill amortisation decreased, principally as a result
of a decline in the profitability of Vodafone Sweden, due to significantly
higher operating expenses and depreciation charges, following the continuing
cost of developing the 3G network which was launched in July 2004, and increased
acquisition and retention costs as competition intensified. In the Netherlands,
operating profit before goodwill amortisation increased as a result of a release
of a provision, following a successful appeal reducing a fine imposed by the
Dutch Competition Authority on mobile operators for a breach of the Dutch
Competition Act. The effect of this release was partially offset by a rise in
customer acquisition costs. SFR reported strong revenue growth as a result of a
7% increase in the average customer base over the prior period and improved
usage of voice and non-voice services, including Vodafone live! which had 1.4
million SFR customers at 30 September 2004. The Group's share of the operating
profit before goodwill amortisation of SFR increased following this revenue
growth and an improved operating margin.

On 24 September 2004, the Group entered into a sale and purchase agreement to
acquire the remaining 7.2% shareholding in Vodafone Hungary from Antenna
Hungaria Rt. The sale is due to be completed on or before 31 December 2004,
subject to certain conditions.

SOUTHERN EUROPE

Financial highlights             Six months to 30 September
--------------------                     2004          2003            % change

                                           £m            £m         £         €

Turnover   Italy(1)                     2,723         2,634         3         8
           Spain                        1,554         1,330        17        22
           Other Southern Europe        1,087           955        14
           Less: intra-segment
           turnover                       (21)          (16)
                                        ------        ------
                                        5,343         4,903         9
                                        ------        ------
Total 
Group
operating  Italy                        1,127         1,113         1         6
profit(2)  Spain                          397           384         3         8
           Other Southern Europe          283           232        22
                                        ------        ------
                                        1,807         1,729         5
                                        ------        ------
Italy
-----

Trading
results    Voice services               2,239         2,213         1         6
           Non-voice services             369           312        18        24
                                        ------        ------
           Total service revenue        2,608         2,525         3         8
           Other revenue (1)                7             7         -        11
           Other direct costs            (146)         (143)        2         8
           Interconnect costs            (464)         (442)        5        10
           Net acquisition costs(1)       (38)          (32)       19        24
           Net retention costs(1)         (41)          (33)       24        29
           Payroll                       (161)         (152)        6        11
           Other operating
           expenses                      (310)         (301)        3         8
           Depreciation and              
           amortisation(2)               (328)         (316)        4         8
                                        ------        ------
           Total Group operating        
           profit(2)                    1,127         1,113         1         6
                                        ------        ------
           EBITDA margin                 53.4%         54.3%
           

KPIs       Closing customers ('000)    21,686        19,982                   9
           Average monthly  ARPU        €30.3         €30.5                  (1)


(1) Turnover for Italy includes revenue of £108 million (2003: £102 million) 
    which has been excluded from other revenue and deducted from acquisition
    and retention costs in the trading results
(2) Before goodwill amortisation and exceptional items
See page 37 for definition of terms

Italy

Vodafone's strategy in Italy is focused on gaining high value customers. Market
share, in terms of revenue, was approximately 39% for the quarter ended 31 March
2004 compared to a customer market share of approximately 36% at 31 March 2004,
demonstrating the Group's commitment to service such customers. Market
penetration levels, including the effect of customers having a SIM from more
than one mobile operator, are over 100%, but excluding this effect, penetration
was lower.

The increasing customer base continued to be the main driver of service revenue
growth, with average customers for the period 9% higher than the comparative
period. Activity levels among the base, however, declined to 92% at 30 September
2004 from 94% at 30 September 2003, due to competition, resulting in a slightly
reduced average monthly ARPU. Revenue growth over the summer was impacted by
extended promotions providing reductions in airtime charges, which have been
successful in stimulating higher usage.

Improved messaging revenue represents the main proportion of the increase in
non-voice revenue. A 114% increase in revenue from the Group's data offerings,
including Vodafone live! and Vodafone Mobile Connect datacards, also
contributed. By 30 September 2004, Vodafone Italy had 1,643,000 Vodafone live!
customers.

The EBITDA margin fell slightly due to higher interconnect costs as a result of
increased international roaming, and increased investments in acquisition and
retention activities arising from competitive pressures, though these effects
have been partially offset by ongoing operational efficiencies. Operating
profit, before goodwill amortisation and exceptional items, was impacted by the
same factors.



Financial highlights           Six months to 30 September
--------------------                  2004           2003              % change
                                        £m             £m          £          €
Spain
-----
Trading results Voice services       1,246          1,100         13         18
                Non-voice
                services               180            131         37         44
                                     ------         ------
                Total service
                revenue              1,426          1,231         16         21
                Other revenue(1)         1              1          -        (16)
                Other direct
                costs                 (117)           (91)        29         35
                Interconnect costs    (266)          (240)        11         16
                Net acquisition
                costs(1)              (115)           (62)        85         94
                Net retention 
                costs(1)               (75)           (65)        15         21
                Payroll                (66)           (71)        (7)        (3)
                Other operating
                expenses              (224)          (190)        18         23
                Depreciation and
                amortisation(2)       (167)          (129)        29         36
                                     ------         ------
                Total Group
                operating profit(2)    397            384          3          8
                                     ------         ------
                EBITDA margin         36.3%          38.6%

KPIs            Closing Customers
                ('000)               10,452          9,399                   11
                Average monthly
                ARPU                  €35.4          €31.8                   11

(1) Turnover for Spain includes revenue of £127 million (2003: £98 million) 
    which has been excluded from other revenue and deducted from acquisition
    and retention costs in the trading results
(2) Before goodwill amortisation
See page 37 for definition of terms

Spain

Vodafone Spain delivered strong growth during the period, benefiting from
changes to refocus the business on customer segmentation, improved customer
satisfaction and attractive product offerings. These measures have stimulated
usage and new customer acquisitions within a very dynamic market.

In local currency, turnover increased by 22% principally following the 21%
increase in service revenue, due to growth in the average customer base over the
prior period and higher usage per customer. Growth in the customer base of 8%
over the six months ended 30 September 2004 has been due to a successful
acquisition strategy focusing on both new customers and those transferring
numbers from other networks, with the proportion of contract customers improving
to 45% at 30 September 2004, compared to 43% at 31 March 2004 and 30 September
2003. Non-voice revenue increased by 44% and represented 12.6% of service
revenue for the six months ended 30 September 2004. The rise in non-voice
revenue is principally driven by messaging but also by an increase in
non-messaging data revenue from service offerings such as Vodafone live! and
Vodafone Mobile Connect datacard.

Average monthly ARPU increased by 11%, benefiting from the increased percentage
of contract customers and higher usage by contract and prepaid customers
resulting from usage stimulation initiatives and promotions.

The strong growth in the customer base has resulted in increased acquisition
costs and has contributed to the decrease in the EBITDA margin by 2.3 percentage
points to 36.3%. Operating profit before goodwill amortisation was impacted by
the factors above in addition to both increased depreciation and licence
amortisation charges, primarily due to the commencement of 3G services in the
second half of the previous financial year.

On 1 November 2004, Vodafone Spain's termination rates were reduced by 10.5%,
following guidance from the national regulator.

Other Southern Europe

Proportionate customers for the Group's other operations in the Southern Europe
region increased by 6% in the six month period to 30 September 2004.

Turnover increased by 14%, driven by strong service revenue growth, as a result
of higher usage of both voice and non-voice products in all other Group
subsidiaries in Southern Europe. In Greece, service revenue increased by 18% in
local currency, boosted by strong voice usage growth, a 26% increase in data
revenue and a 16% increase in visitor revenue benefiting from the Olympics
hosted by Athens in August 2004. Service revenue in Vodafone Portugal increased
by 15% in local currency driven by a larger customer base, growth in visitor
revenue benefiting from the UEFA Euro 2004 football tournament and increased
blended ARPU, partially offset by lower termination rates.

EBITDA margins also improved in these operations, following increased turnover,
improved acquisition costs and controlled operating expenses, partially offset
by higher interconnect costs and increased retention costs from a higher level
of equipment upgrades. Operating profit before goodwill amortisation increased,
although depreciation charges were higher primarily as a result of investment in
3G networks. The Group's associated undertaking Mobifon obtained a 3G licence in
Romania in October 2004 for $35 million (£19 million).

AMERICAS

Financial highlights          Six months to 30 September
--------------------                  2004          2003              % change
                                        £m            £m          £          $
Total Group
operating       
profit/         Verizon Wireless       885           712         24         40
(loss)(1)       Other Americas           -            (7)         -
                                     ------        ------     ------
                                       885           705         26
                                     ------        ------     ------
Proportionate   Verizon Wireless     3,433         3,102         11         24
turnover        Other Americas           -            31          -
                                     ------        ------     ------
                                     3,433         3,133         10
                                     ------        ------     ------
Proportionate
EBITDA
margin          Verizon  Wireless     39.3%         35.7%

Verizon Wireless
----------------

KPIs            Closing             
                customers ('000)    42,118        36,026                    17
                Average monthly
                ARPU                 $53.2         $50.6                     5
                Acquisition and
                retention costs
                as a percentage
                of service
                revenue               12.3%         13.7%

(1) Before goodwill amortisation
See page 37 for definition of terms

Verizon Wireless

In a highly competitive US market, Verizon Wireless continued to outperform its
competitors and ranked first in customer net additions for the six months ended
30 September 2004. The total customer base increased by 8% over the period to
42,118,000. At 30 June 2004, US market penetration had reached approximately
58%, with Verizon Wireless' market share at approximately 24%.

In local currency, proportionate turnover increased by 24% over the prior period
driven by the larger customer base and increasing ARPU primarily due to
customers migrating to higher access price plans and growth in non-voice service
revenue. Non-voice services, such as picture messaging and 'Get It Now',
contributed to a 169% increase in non-voice service revenue over the prior
period.

Churn rates continued to improve and are amongst the lowest in the market
despite the expansion of local number portability from the 100 largest
metropolitan service areas to a nationwide basis on 24 May 2004. The low churn
rate is attributable in part to the quality and coverage of Verizon Wireless'
network and the success of retention programmes such as the 'Worry Free
Guarantee', which includes the 'New Every Two' plan.

The proportionate EBITDA margin increased by 3.6 percentage points to 39.3%,
which reflects increased cost efficiencies. Verizon Wireless has achieved
sustained cost containment through the reduction of interconnect and leased line
rates as well as other operating expenses efficiencies. In local currency, the
Group's share of Verizon Wireless' operating profit before goodwill amortisation
increased by 40%.

Verizon Wireless is expanding its BroadbandAccess service nationally. Powered by
its Evolution-Data Optimized wide-area network, the service is currently
available in more than 14 major metropolitan areas and 24 airports with the
expansion on target to cover one third of Verizon Wireless' network by the end
of 2004.

Additionally, Verizon Wireless continued to acquire spectrum, which enables
network capacity expansion to meet customers' growing demand for services.
Agreements reached include the purchase of spectrum in New York City, Arkansas,
62 markets in Western and Midwestern states and, in November 2004, all of
NextWave's PCS spectrum licences, which cover 23 markets across the country.

Other Americas

The Group disposed of its stake in the Mexican mobile operator Grupo Iusacell
during the previous financial year.







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