Preliminary Results - Part 2

Vodafone Group PLC
29 May 2001

PART 2


OTHER BUSINESS DEVELOPMENTS

Business Reorganisation

On  1 April 2001 the Group implemented the planned reorganisation of its
overall management structure and governance process in response  to  the
rapid expansion of the Group.  Under the overall supervision of the Main
Board,  the  Group now has three Management Committees  to  oversee  the
execution of the Board's strategy and policy and to ensure that Vodafone
remains at the forefront of its industry.

Following  these  changes  Chris  Gent  continues  to  chair  the  Group
Executive  Committee  and is also chairman of  the  newly  formed  Group
Policy Committee.  Julian Horn-Smith, previously Chief Executive of  the
Europe region, is the newly appointed Group Chief Operating Officer  and
chairs the Group Operational Review Committee.

The  Group's  European operations have also been split  into  three  new
regions  from 1 April 2001: Northern Europe, Central Europe and Southern
Europe.  Vittorio Colao, previously Chief Executive of Omnitel Vodafone,
was  appointed  Chief  Executive  of  Southern  Europe  and  Jurgen  von
Kuczkowski,  previously  Chief Executive of D2 Vodafone,  was  appointed
Chief Executive with responsibility for Central Europe.  Both appointees
joined  the Executive Committee.  Peter Bamford becomes Chief  Executive
for Northern Europe, Middle East and Africa.

Project Momentum and Global Brand

On  1  April  2001, Thomas Geitner was appointed Chief  Executive  Group
Products  and  Services  with  new global responsibilities  for  Product
Management  and Innovation, Brand Management, IT and Technology,  Supply
Chain Management and Multi-National Account Management.

These  five  key  functions,  which are being  co-ordinated  across  the
Group's  controlled businesses, supplement the Group's existing regional
structures.   The  initial focus will be in the  three  new  regions  in
Europe  with subsequent rollout to the Group's global businesses.   Each
of  these  new initiatives is currently projected to contribute  towards
the  achievement of after tax cash savings for the Group of £600 million
in  2004  and  to lead to the introduction of 3G services  and  customer
experience of seamless services across the Group's global footprint.

Product  management  and innovation: Vodafone has  begun  to  offer  its
customers  Group-wide product offerings, with services such as EuroCall,
short  code access, and assisted roaming being successfully launched  on
Vodafone networks in Europe. Short code access allows voice products  to
'travel' with the customer, with short code dialling and utilisation  of
the  mailbox  being  identical in each of  the  visited  networks.  With
EuroCall, the Group has introduced a flat-rate single tariff in  Europe,
a service already being used by more than 1.6 million customers.

The  enhanced  data  capabilities of GPRS and UMTS,  together  with  the
deployment of new handsets, will allow a new set of innovative  products
to  be  delivered  to  customers. New products such  as  location  based
services,  mobile  payment facilities (with micro-payment  and  e-Wallet
functionality), prepay and GPRS roaming, unified messaging  and  instant
messaging have target launch dates for 2001/2002.  Further programmes to
enable  access  to the Internet and specific applications  for  business
customers will follow.

Brand  management:  New  seamless products demand  a  single  ubiquitous
Vodafone brand in all markets and its adoption will maximise the  return
from the Group's investment in marketing and application development and
will  increase  customer loyalty. The objective is to rollout  a  common
Vodafone  brand without eroding existing brand equity. In  January  2001
brand  migration  started  in Europe with  new  dual  brand  logos  (for
example,  'D2  Vodafone')  replacing existing  logos.   This  marks  the
beginning  of  a  transition  phase, which will  lead  to  a  consistent
identity  and  brand positioning for all of the Group's subsidiaries  by
early  2002. In parallel, the brand campaign will support the launch  of
Group-wide  services,  such as EuroCall.  It is intended  that  Vodafone
will be one of the world's top brands.

IT and Technology: The next generation of mobile services is expected to
be  accompanied  by the development and implementation  of  standardised
platforms across the Group's networks. GPRS is expected to allow  mobile
data  access  speeds  that  match today's fixed  desktop  computer  with
substantial  reductions  in call set-up times  through  an  'always  on'
capability  for  the  customer, improving the customer  friendliness  of
mobile data applications. The Group's initial focus will be to offer the
benefits  of GPRS technology by the launch of an expanded data  services
portfolio, with harmonised technologies and common billing systems.  The
launch  of  3G  services will provide even more capacity, bandwidth  and
speed  and  is  expected to provide the platform for more  sophisticated
products  such as video streaming and picture messaging.  3G  technology
is  expected to enable mobile to substitute for fixed telephone services
in  the provision of voice and narrow-band data services, as well as for
some broadband applications.

Supply  chain  management:  Global  procurement  initiatives,  initially
concentrating  on  handsets,  interconnect agreements,  IT  and  network
infrastructure,  will  enable  the  Group  to  leverage  its  purchasing
strength,  to improve supply chain processes across Group companies  and
to  develop strategic partnerships with selected suppliers in  order  to
harmonise product and technology planning.

Multi-national account management: Multinational account management fits
well  with  Vodafone's strong and increasing presence in  the  corporate
sector.  The  Group  has  begun to serve multinational  accounts  across
markets  with competitive price plans and unique pan-European  services.
Major  contracts  signed  so  far are with  business  customers  in  the
accountancy  and  the  FMCG  segments.  Vodafone  expects   demand   for
multinational services to grow in the coming years.

Internet and Mobile Data

During  the year Vodafone continued to implement its strategy to develop
a  global  Internet platform.  The development of the  platform  is  the
responsibility  of  the Vodafone Global Internet and  Platform  Services
organisation located in California.

Important  milestones were reached during the year, including completion
of  the  long-term  platform  road map and  architecture,  building  the
development and deployment team and identifying key technology partners.
The  first  version of the platform has been deployed  in  Vodafone  New
Zealand,  where  customers are currently using mobile Internet  services
with the Vizzavi brand.

The  current version of the platform offers an attractive user interface
including  quick  and easy navigation, integration  of  services  across
multiple  access  devices:  desktop, mobile phones  and  PDAs,  personal
information management (calendar, email), user personalisation  for  web
and  WAP  pages,  local  content  integration,  alerts  on  content  and
information and location-based services for users with WAP phones.

During  2001, we intend to add increased functionality including unified
and  instant  messaging,  mobile commerce, voice navigation,  mobile-PIM
synchronisation,  personal account consolidations,  enhanced  m-commerce
and fully integrated shopping and location-based services. The next full
release of the platform will be available commercially by the end of the
calendar year 2001.

During 2001 the platform will also be deployed for Vodafone operators in
Australia,  Egypt,  and  Romania.  The  Group  is  in  discussions  with
affiliates in Japan, the United States, China and Europe for  their  use
of the entire platform or key elements of it.

Vizzavi,  which  is  already available in The Netherlands,  the  UK  and
France  as a PC and mobile portal, is expected to roll out its  services
to  Germany,  Italy,  Greece, Spain and Portugal by  the  end  of  2001.
Vizzavi  will be well placed to take advantage of the growth in wireless
services  expected with the roll out of GPRS in 2002.  At 31 March  2001
Vizzavi Europe had more than 700,000 customers. Headquartered in London,
the company currently has more than 800 employees in six countries.

In  addition to its core offering, Vizzavi has launched services such as
WAP  games,  e-mail,  picture mail, music streaming,  news  and  finance
content  and  location-based services.  Later this  year,  functionality
such as unified messaging, instant messaging and e-commerce capabilities
will  be  added  to the portal.  With the advent of GPRS's  'always  on'
capability  and the introduction of new devices and technology,  Vizzavi
customers will see continuous enhancements to the portal.

Vodafone  recognises the benefits of creating a strong  portal  offering
which  will  serve  to increase airtime usage, reduce churn  and  create
additional value.  Vizzavi forms a core part of achieving the data  ARPU
targets that the Group has set itself.

Sales of Businesses

Following the Mannesmann transaction, the Group has agreed the sale of a
number  of  businesses  for an aggregate value  of  approximately  £33.3
billion.  Cash  proceeds  during the year totalled  approximately  £27.9
billion,  including  loan repayments to the Group of approximately  £1.9
billion,  the  remaining proceeds of approximately  £5.4  billion  being
subject  to  the  exercise of certain put options and  the  delivery  of
France Telecom shares by Vodafone.

In  April  2000,  Mannesmann reached an agreement with  Siemens  AG  and
Robert  Bosch  GmbH  for  the sale of a controlling  interest  in  Atecs
Mannesmann,  its  engineering and automotive business.  The  transaction
valued Atecs at approximately Eur 9.6 billion, including pension and non-
trading financial liabilities to be assumed on closing.  On 29 September
2000,  a  payment of approximately Eur 3.1 billion (£1.9  billion)  plus
interest was made to Mannesmann in exchange for the pending transfer  of
a  50% plus two shares stake in Atecs Mannesmann, which completed on  17
April  2001 following approval from the relevant European Union  and  US
regulatory authorities.  Atecs Mannesmann also repaid Group loans of Eur
1.55  billion (£1.0 billion) in March 2001.  Further proceeds of between
Eur 3.7 billion and Eur 3.8 billion may be realised upon the exercise of
certain  put options over the remaining stake between 17 April 2001  and
31 December 2003.

The  sale  of Orange to France Telecom was completed on 22 August  2000,
following the receipt of conditional approval by the European Commission
and  approval  by the shareholders of France Telecom.  The consideration
comprised  a  cash  payment of approximately  Eur  21.4  billion  (£13.2
billion),  a  Eur  2.2 billion France Telecom loan note and  113,846,211
France  Telecom  shares,  representing 9.87% of  the  outstanding  share
capital  of France Telecom. In addition, France Telecom assumed Orange's
existing  debts,  and  its  financial obligation  regarding  its  UK  3G
licence,  totalling £4.1 billion. The loan note was  redeemed  in  March
2001 and realised proceeds of £1.4 billion.  The Group also renegotiated
and  exercised its put options over France Telecom shares  for  a  total
value  of approximately Eur 11.6 billion, of which Eur 6.7 billion (£4.2
billion) was received in March 2001 with the balance being receivable in
March 2002. The balancing payment of approximately Eur 4.9 billion (£3.1
billion) is subject to an upward adjustment dependent upon movements  in
France Telecom's share price and currency fluctuations.

On  9  October 2000, Mannesmann completed the sale of its tubes business
to  Salzgitter for a nominal consideration.  In the period prior to  the
completion of sale, Mannesmann made capital contributions to  the  tubes
business  totalling Eur 271 million. Mannesmann also completed the  sale
of   Les  Manufactures  Horlogeres,  its  luxury  watches  business,  to
Richemont   S.A.   in  December  2000,  for  a  cash  consideration   of
approximately Eur 1.8 billion (£1.1 billion).

On  29  March  2001 the Group completed the sale of Infostrada  to  Enel
S.p.A.   Total  proceeds received at completion for  the  entire  issued
share  capital  of  Infostrada were Eur 7.4 billion (approximately  £4.7
billion)  and  Enel  assumed Infostrada's net debt,  including  Eur  0.8
billion (£0.5 billion) of debt owed to the Group.

On  8  May  2001 the Group announced that agreement had been reached  to
sell  its  100% equity stake in the Austrian telecommunications company,
tele.ring   Telekom  Service  GmbH.   The  transaction  is  subject   to
regulatory approval.

The formation of Verizon Wireless in April 2000 resulted in net proceeds
to  the  Group  of  approximately £2.5 billion  from  a  debt  push-down
arrangement  agreed with the other parties.  Further  proceeds  of  £1.8
billion   have  been  realised  following  the  disposal  of  conflicted
properties in the US, such disposals being a condition of the regulatory
approval of the transaction.


Recent Transactions

On  29 December 2000, the Group completed its acquisition of a total  of
4,061,948 shares in Airtel Movil S.A., representing approximately  52.1%
of  the  issued share capital of Airtel.  The acquisition increased  the
Group's   stake  in  Airtel  to  73.8%.   In  consideration  for   their
shareholdings  Vodafone issued 3,097,446,624 new listed ordinary  shares
to  the  transferring  Airtel shareholders, representing  a  transaction
value of approximately £7.9 billion for the acquired shares.

Following receipt of regulatory approvals and the agreement of  Swisscom
AG's shareholders, a 25% equity interest in Swisscom Mobile was acquired
for  CHF4.5 billion (£1.8 billion) during the first quarter of 2001. The
consideration  for  the  25% stake represents  an  enterprise  value  of
approximately £7.3 billion for Swisscom Mobile, including  net  debt  of
£0.2  billion.  Vodafone satisfied the first £0.85  billion  tranche  of
consideration  by the issue of 422,869,008 new Vodafone shares  and  the
payment  of  CHF25 million in cash. The second tranche of £0.98  billion
will be satisfied in cash or Vodafone Group Plc shares, or a combination
of both, at Vodafone's discretion and is payable by March 2002.

On  4 April 2001 the Group completed its acquisition of a 34.5% stake in
Grupo  Iusacell,  S.A. de C.V., the second largest  mobile  operator  in
Mexico with over 1.7 million customers, for a cash consideration of $973
million.   Verizon Communications Inc., Vodafone's existing  partner  in
Verizon Wireless in the US, owns approximately 37% of Iusacell.

On  12  April  2001, following the second payment of Yen  125.1  billion
(£0.7  billion),  the acquisition of a 15% stake in Japan  Telecom  from
West  Japan  Railway  Company  and Central  Japan  Railway  Company  was
completed.  The initial payment of Yen 124.6 billion (£0.7 billion)  was
made  on  31  January 2001.  On 26 April 2001, the Group  completed  the
acquisition of a further 10% stake in Japan Telecom from AT&T for a cash
consideration of $1.35 billion (£0.9 billion).

On  2  May  2001, Vodafone announced that it had agreed to acquire  BT's
ownership  interests in Japan Telecom and the J-Phone Group for  a  cash
consideration of £3.7 billion, assuming the exercise by BT of its option
over shares in the operating subsidiaries of the J-Phone Group, and  the
acquisition of BT's 17.8% shareholding in Airtel Movil S.A. for  a  cash
consideration  of  £1.1 billion. The acquisition of  BT's  interests  in
Japan  Telecom  and the J-Phone Group are expected to  be  completed  by
August  2001,  conditional  upon  regulatory  approvals  and  procedural
requirements under agreements to which BT is a party and the exercise of
certain  options by BT.  The Airtel transaction is expected to close  by
the  end  of  June 2001 and is conditional upon EU regulatory  approval.
Neither transaction is conditional upon the other.

On 21 December 2000 eircom plc announced the proposed demerger of eircom
plc's  mobile communications business, Eircell, to a new company, called
Eircell  2000,  and Vodafone announced a separate offer for  the  entire
share  capital  of  Eircell 2000.  Eircell is the  leading  provider  of
mobile communications in Ireland, with over 1.5 million customers at  31
March  2001.  At the date it was launched, the offer valued  Eircell  at
approximately  Eur  3.6  billion, including the assumption  of  Eur  250
million of net debt. The offer was declared unconditional on 14 May 2001
following  the  receipt of valid acceptances representing  approximately
79.6% of the total shareholding in Eircell. The offer remained open  for
acceptance  until 27 May 2001 and, in accordance with  the  Articles  of
Association  of Eircell, all shareholders were deemed to  have  accepted
the offer at that date.


FINANCIAL REVIEW

Profit and loss account

The  Group  has  completed a number of significant transactions  in  the
year.

The  results and net assets of Mannesmann have been consolidated in  the
Group's  financial statements with effect from 12 April 2000,  the  date
the  acquisition was completed.  Non-core businesses sold following  the
acquisition   of   Mannesmann,  including  Atecs   Mannesmann,   Orange,
Mannesmann's  watches  and  tubes businesses,  Ipulsys,  Infostrada  and
tele.ring, have not been consolidated in the results for the year.

The  results and net assets of Airtel have been fully consolidated  with
effect  from 29 December 2000. Prior to the acquisition of a controlling
interest, the Group's 21.7% interest in Airtel was accounted for  as  an
associated  undertaking within continuing operations  under  the  equity
accounting method.

The  Group's interest in Verizon Wireless, which was formed on  3  April
2000, has been accounted for using equity accounting in the current year
and  the  Group's  share  of  results  is  disclosed  within  continuing
operations.   In the year ended 31 March 2000, turnover of  £2,585m  and
operating  losses of £100m (after goodwill amortisation) in  respect  of
the Group's US businesses were fully consolidated.

Group turnover and total Group operating (loss)/profit

Group  turnover  increased to £15,004m from  £7,873m  last  year.   This
reflects growth in continuing operations from £5,288m to £6,637m,  after
adjusting  for the results of US operations in prior year turnover,  and
includes  £8,367m  in  respect of acquired  businesses.   Turnover  from
continuing operations, including the Group's share of joint ventures and
associated undertakings, increased from £11,521m to £15,155m, reflecting
the strong growth of these businesses.

Total  Group  operating loss of £6,998m for the  year  (31  March  2000:
profit of £796m) is after charging exceptional operating costs of  £320m
(31  March  2000: £30m) and goodwill amortisation of £11,882m (31  March
2000:  £1,712m).   Total  Group  operating  profit,  before  exceptional
operating  costs  and  amortisation of goodwill, increased  to  £5,204m,
compared  with £2,538m last year.  Acquisitions represented  £2,087m  of
the increase with a further increase of £579m to £3,117m from continuing
operations.

Exceptional  operating  items  of £320m  primarily  comprise  impairment
charges  of  £91m  in relation to the carrying value of  certain  assets
within  the  Group's Globalstar service provider businesses, exceptional
reorganisation  costs  of  £85m relating to  the  restructuring  of  the
Group's operations in Germany and the US, and £141m in relation  to  the
Group's share of the restructuring costs incurred by Verizon Wireless.

The  increase  in  the  goodwill amortisation  charge  from  £1,712m  to
£11,882m  is primarily due to amortisation of the goodwill arising  from
the  acquisition  of  Mannesmann, provisionally  calculated  to  be  £83
billion,  goodwill  on formation of the Verizon Wireless  joint  venture
partnership and a full year's amortisation charge for goodwill  relating
to the acquired AirTouch operations (excluding US businesses contributed
to  Verizon  Wireless). These charges for goodwill amortisation  do  not
affect  the cash flows of the Group or the ability of the Group to  make
dividend payments.

Exceptional non-operating items

The  net  profit of £80m from exceptional non-operating items  primarily
comprises  a  profit of £261m relating to the settlement  of  a  hedging
transaction, offset by impairment charges of £193m against  the  Group's
investments  in  Globalstar and Shinsegi Telecom, Inc.   The  profit  of
£954m in the prior year arose mainly on disposal of the Group's interest
in  E-Plus  Mobilfunk  GmbH  as  a  condition  of  EU  approval  of  the
acquisition of Mannesmann.

Interest

Total  Group  interest, including the Group's share of the  net  interest
expense of joint ventures and associated undertakings, increased by £776m
to  £1,177m.  Net interest costs in respect of the Group's net borrowings
increased  by  £517m  to £850m, compared with £333m  (before  exceptional
finance  costs  of  £17m)  in the year to 31  March  2000.  The  increase
includes interest on Mannesmann's debt of £12,551m, which was assumed  at
acquisition on 12 April 2000. Group interest, excluding the Group's share
of   the   net   interest  expense  in  joint  ventures  and   associated
undertakings,  is  covered 6.2 times by Group EBITDA (before  exceptional
operating  costs)  plus  dividends  received  from  joint  ventures   and
associated undertakings.

Taxation

The  effective  rate  of  taxation for the  year,  before  goodwill  and
exceptional  non-operating items, increased to 33.9% from 32.5%  in  the
year  ended 31 March 2000.  The 1.4% increase in the effective tax  rate
is  primarily the result of the integration of the Mannesmann businesses
into  the Group's result. The results of the Mannesmann businesses  have
been consolidated since acquisition on 12 April 2000.

Pro forma proportionate financial information

Due  to the significance of the acquisition of Mannesmann and the merger
with  AirTouch on the results for each of the years ended 31 March  2001
and   31   March  2000,  unaudited  pro  forma  proportionate  financial
information has been presented on the basis that these transactions took
place on 1 April in each financial year. The following discussion of pro
forma proportionate Group turnover and EBITDA, before exceptional items,
provides a more direct comparison of year-on-year operating performance.

Mobile operations

Pro  forma  proportionate  turnover for the  Group's  mobile  businesses
increased  by  over 29% to £21,428m and pro forma proportionate  EBITDA,
before  exceptional  items, increased by 28% from  £5,504m  to  £7,043m,
reflecting  the strong progress of the business following the Mannesmann
transaction and formation of Verizon Wireless.

After  making  adjustments  for  acquisitions  completed  in  the  year,
primarily the increased stakes in Airtel in Spain, the J-Phone Group  in
Japan  and the acquisition of shareholdings in Swisscom Mobile and China
Mobile,  underlying  growth  in  both  mobile  pro  forma  proportionate
turnover and EBITDA, at constant exchange rates, was 25%.

In  Continental Europe pro forma proportionate turnover grew  by  almost
21%   to   £9,743m.  This  increase  comprised  strong  organic  growth,
reflecting  the  rapid growth in customer numbers in all major  markets,
the  Group's increased shareholding in Airtel and the acquisition of  an
equity interest in Swisscom Mobile.

Pro  forma  proportionate  EBITDA for Continental  Europe  increased  by
almost  22%  to £3,534m. A reduction in EBITDA margin of 6%  in  Germany
impacted  this  result, the decrease being due  to  the  high  level  of
connection costs resulting from record customer growth, particularly  in
the  first  half  of  the  financial year. The  increase  in  pro  forma
proportionate EBITDA reflects strong trading throughout the region  with
particularly  strong margin improvements in the Group's subsidiaries  in
Italy, Greece, the Netherlands and Spain.

Proportionate  turnover  in  the UK increased  by  17%  to  £3,458m  and
proportionate  EBITDA  increased by 14% to £1,068m,  reflecting  further
strong  prepay customer growth and the increased usage of data services,
offset by the impact of tariff reductions.

In the United States, proportionate turnover and EBITDA were £5,008m and
£1,627m,  respectively,  resulting in an  EBITDA  margin  of  32%.  This
reflects the profitable trading of Verizon Wireless during the year,  as
the  business  has focused on gaining high value customers  through  new
customer  additions and the migration of existing analogue customers  to
digital price plans.

The  Asia  Pacific  region  saw an increase in pro  forma  proportionate
turnover  of  over  80%  to  £2,771m  and  an  increase  in  pro   forma
proportionate  EBITDA of almost 56% to £587m. This comprised  underlying
organic  growth  of  50% and 28%, respectively, with the  balance  being
primarily  due  to the acquisition of increased stakes  in  the  J-Phone
Group  and  the acquisition of a 2.18% stake in China Mobile during  the
year.

The  Middle  East and Africa region reported an increase  in  pro  forma
proportionate EBITDA of almost 60% to £227m. Strong growth  occurred  in
both the Group's subsidiary in Egypt and associated undertaking in South
Africa.

Other operations

Pro  forma  proportionate  turnover  in  the  Group's  other  operations
remained  relatively  constant at £802m. Pro forma proportionate  EBITDA
was  an overall loss of £27m primarily as a result of the Group's  share
of the losses incurred by Vizzavi Europe.

Exchange rates

The net impact of movements in exchange rates was not significant to the
year  on  year increases in pro forma proportionate turnover and EBITDA,
with  the  effect  of adverse exchange rate movements against  the  Euro
being  offset by favourable movements against the US dollar and Japanese
yen.

Earnings per share

Basic  earnings  per  share,  before  goodwill  and  exceptional  items,
decreased by 20% from 4.71p to 3.75p, primarily  reflecting the dilution
arising  from the issue of new shares in connection with the  Mannesmann
acquisition.

Basic  earnings  per share, after goodwill and exceptional  items,  fell
from  1.80p  last year to a loss per share of 15.89p in the year  to  31
March  2001.  The loss per share of 15.89p includes a charge  of  19.34p
per  share  (2000: 6.32p per share) in relation to the  amortisation  of
goodwill.

Dividends

The  proposed final dividend of 0.714p produces a total for the year  of
1.402p,  an  increase of 5% over last year, and reflects the  continuing
strong  trading  performance and operating cash flow generation  of  the
Group's  operations.  The  dividend  was  covered  2.4  times  by  Group
earnings, before goodwill amortisation, compared with 3.5 times  in  the
year ended 31 March 2000.

Employees

The  Company  and  its  subsidiary undertakings  employed  approximately
56,800 people at 31 March 2001, including 29,800 employees in businesses
acquired  during  the year.  This compares with 25,600 employees  at  31
March  2000,  after excluding 15,100 people employed in the US  wireless
businesses transferred to Verizon Wireless. Of the total employees at 31
March 2001, 81% worked outside the United Kingdom.

Measurement of prepay churn and active customers

The  Group's global policy for the measurement of prepay customer  churn
by  subsidiaries  is  to  adopt  the local  market  practice  agreed  by
operators  for  the purposes of market share comparisons.   If  a  local
policy  is  not  in  place, the Group's policy is to  exclude  from  the
measurement  of  total registered customers those prepay  customers  who
have not used their mobile phones for over six months.

Active  customers are defined as registered customers who have  made  or
received  a  call  in  the last three months or,  where  information  on
incoming  calls is not available, defined as customers who have  made  a
chargeable call in the last three months.

Balance sheet

Total  fixed assets have increased in the year from £150,851m last  year
to £154,375m at 31 March 2001.

At  31 March 2000, the Group's interest in Mannesmann AG was included in
fixed asset investments at a cost of £101,246m.  Following completion on
12  April  2000,  and  the  consolidation of the  acquired  net  assets,
goodwill  has  been  provisionally calculated  to  be  £83,028m  and  is
included in intangible assets.

The  assets  of  the US businesses contributed to Verizon Wireless  have
been  treated as having been disposed, including attributed goodwill  of
£19.5  billion arising from the AirTouch transaction that was previously
included  in intangible fixed assets. The Group's interest  in  the  new
venture  has  been  equity  accounted within investments  in  associated
undertakings at an initial value of £19,809m.

The remaining increase in intangible assets primarily comprises £13,347m
in  respect  of  3G licences acquired in the year and  goodwill  on  the
acquisition  of  a  controlling  interest  in  Airtel  of  approximately
£7,740m.  The increase in tangible fixed assets from £6,307m to £10,586m
includes  fixed assets from acquisitions of £4,840m.  Other fixed  asset
investments  at  31 March 2001 include the Group's equity  interests  in
China  Mobile  (2.18%)  and Japan Telecom (7.5%),  which  were  acquired
during the year.

Current  asset investments with an aggregate value of £13,211m primarily
comprise the Group's remaining interest in Atecs Mannesmann, a balancing
payment of approximately £3,092m receivable from the exercise of  a  put
option over France Telecom shares and liquid investments with a value of
£7,593m.   The  liquid investments arose primarily from the  receipt  of
sales  proceeds  following the disposal of Infostrada  and  receipts  in
relation  to the France Telecom shares and loan notes received from  the
disposal of Orange.

Equity shareholders' funds

Total  equity  shareholders' funds at 31 March 2001 had  increased  from
£140,833m  at  31  March  2000  to  £145,393m.  The  movement  primarily
comprises  new  share  capital and share premium of  £9,950m,  including
shares  issued  as consideration for acquisitions completed  during  the
year,  net currency translation gains of £5,197m, offset by a  loss  for
the  year  of  £9,763m  (after goodwill amortisation  of  £11,882m)  and
dividends paid and declared in respect of the year totalling £887m.

Cash flows and funding

Cash  generated  from  operating activities increased  by  £2,077m  from
£2,510m  to  £4,587m for the year, due primarily to the  growth  in  the
Group's  operations  and the inclusion of the operating  cash  flows  of
acquired  businesses. The principal cash outflows in the period  related
to  the purchase of intangible assets (£13,163m), primarily 3G licences,
purchases  of  tangible  fixed assets (£3,698m), acquisitions  of  fixed
asset  investments (£3,254m), primarily China Mobile and  Japan  Telecom
and the payment of taxation (£1,585m) and equity dividends (£773m).

Cash  proceeds,  including  loan repayments,  were  generated  from  the
disposal of certain assets as set out below.

                                            £ billion
                                                     
 Orange                                          18.7
Infostrada                                        5.2
Atecs Mannesmann                                  2.9
Mannesmann's watches and clocks businesses        1.1
                                                ------
                                                  27.9
                                                ======

In  addition, approximately £4.3 billion was received upon the formation
of Verizon Wireless and the disposal of certain conflicted properties in
the US.

The  resulting net cash inflow, before repayment of debt and  management
of  liquid resources, was £13,744m.  This cash inflow was offset by  the
consolidation  of  the  net  debt of Mannesmann  and  Airtel,  totalling
£13,184m  at  acquisition,  and  other  non-cash  movements  of   £639m,
primarily relating to exchange movements. These movements resulted in  a
small  increase in net debt at 31 March 2001 to £6,722m,  compared  with
£6,643m last year.

Net  debt  at  31  March  2001 represented 5.4% of  the  Group's  market
capitalisation.  This represented a reduction of £6.5 billion  from  net
debt  of  £13.2 billion at 30 September 2000, primarily due to  proceeds
received  in  the second half of the year from the disposal of  non-core
businesses, offset by payments for 3G licences and other investments.

The  Group remains committed to maintaining a strong financial  position
as  demonstrated  by  its credit ratings of P-1/F1/A-1  short  term  and
A2/A/A  long  term from Moody's, Fitch Ratings and Standard and  Poor's,
respectively.  The credit ratings reflect the financial strength of  the
Group  and  were re-confirmed by each of the rating agencies  on  2  May
2001,  following the announcement of the acquisition of  further  equity
interests  in  Japan and Spain, which is being financed in  part  by  an
offering   of  1.825  billion  new  Vodafone  ordinary  shares   raising
approximately £3.5 billion.

The  Group's preservation of its credit ratings has enabled it to access
a  wide  range  of  debt finance including commercial paper,  bonds  and
committed  bank  facilities. The Group has dollar  and  Euro  commercial
paper  programmes for US$15 billion and £2 billion, respectively,  which
it  uses  to meet its short term liquidity requirements.  The commercial
paper  facilities  are  backed  by a US$14.55  billion  (£10.2  billion)
committed  bank facility, which expires in September 2001,  with  a  one
year  term-out  option.   The  Group also has  £13.5  billion  (sterling
equivalent) of capital market debt in issue, with maturities  from  June
2001 to February 2030.


CONSOLIDATED PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31 MARCH 2001

                                            Year ended   Year ended
                                              31 March     31 March
                                                  2001         2000
                                                    £m           £m
Turnover: Group and share of joint                                 
ventures
  and associated undertakings
- Continuing operations                         15,155       11,521
- Acquisitions                                   8,838            -
                                              --------     --------
                                                23,993       11,521
                                                                   
Less: Share of joint ventures and                                  
  associated undertakings                      (8,989)      (3,648)
                                              --------     --------
                                                15,004        7,873
                                              ========     ========
                                                                   
Group turnover (Note 2)                                            
- Continuing operations*                         6,637        7,873
- Acquisitions                                   8,367            -
                                              --------     --------
                                                15,004        7,873
                                              ========     ========
Operating (loss)/profit                                            
- Continuing operations*                         1,044          981
- Acquisitions                                 (7,483)            -
                                              --------     --------
                                               (6,439)          981
Share of operating loss in joint                                   
  ventures and associated undertakings
- Continuing operations                           (26)        (185)
- Acquisitions                                   (533)            -
                                              --------     --------
Total Group operating (loss)/profit            (6,998)          796
(Note 2)
                                                                   
Exceptional non-operating items  (Note 3)           80          954
                                              --------     --------
(Loss)/profit on ordinary activities           (6,918)        1,750
before interest
                                                                   
Net interest payable                           (1,177)        (401)
                                                                   
- Group                                          (850)        (350)
- Share of joint ventures and                                      
    associated undertakings                      (327)         (51)
                                              --------     --------
(Loss)/profit on ordinary activities                               
  before taxation                              (8,095)        1,349
                                                                   
Tax on (loss)/profit on ordinary                                   
  activities (Note 4)                          (1,290)        (685)
                                                                   
- Group                                        (1,118)        (494)
- Share of joint ventures and                                      
    associated undertakings                      (172)        (191)
                                              --------     --------
(Loss)/profit on ordinary activities                               
  after taxation                               (9,385)          664
                                                                   
Minority interests                               (378)        (177)
                                              --------     --------
(Loss)/profit for the financial year           (9,763)          487
                                                                   
Equity dividends (Note 5)                        (887)        (620)
                                              --------     --------
Retained loss for the Group and its share                          
of
  joint ventures and associated               (10,650)        (133)
undertakings
                                              ========     ========
Basic (loss)/earnings per share (Note 6)      (15.89)p        1.80p
Diluted (loss)/earnings per share             (15.90)p        1.78p
Adjusted basic earnings per share (Note          3.75p        4.71p
6)

*  The  AirTouch  US  Cellular  business is included  within  continuing
subsidiary operations in prior year comparatives, but not in the current
year. See Note 1 - Basis of Preparation.



CONSOLIDATED BALANCE SHEET
31 MARCH 2001

                                               31 March      31 March
                                                   2001          2000
                                                     £m            £m
Fixed assets                                                         
Intangible assets                               108,839        22,206
Tangible assets                                  10,586         6,307
Investments                                      34,950       122,338
                                                                     
Investments in joint ventures:                                       
- Share of gross assets                               -         2,912
- Share of gross liabilities                          -         (241)
- Loans to joint ventures                            85             -
                                               --------      --------
                                                     85         2,671
Investments in associated undertakings           31,910        17,979
Other investments                                 2,955       101,688
                                               --------      --------
                                                154,375       150,851
Current assets                                 ========      ========
Stocks                                              316           190
Debtors                                           4,095         2,138
Investments                                      13,211            30
Cash at bank and in hand                             68           159
                                               --------      --------
                                                 17,690         2,517
                                                                     
Creditors: amounts falling due within one year (12,377)       (4,441)
                                               --------      --------
Net current assets/(liabilities)                  5,313       (1,924)
                                               --------      --------
Total assets less current liabilities           159,688       148,927
                                                                     
Creditors:  amounts falling due after          
  more than one year                           (11,235)       (6,374)
                                                                     
Provisions for liabilities and charges            (671)         (193)
                                                                     
Investments in joint ventures:                                       
- Share of gross assets                              88             -
- Share of gross liabilities                      (146)             -
                                               --------      --------
                                                   (58)             -
Other provisions                                  (613)         (193)
                                               --------      --------
                                                147,782       142,360
                                               ========      ========
Capital and reserves                                                 
Called up share capital                           4,054         3,797
Share premium account                            48,292        39,577
Merger reserve                                   96,914        96,914
Other reserve                                     1,024         1,120
Profit and loss account                         (5,869)         (575)
Shares to be issued                                 978             -
                                               --------      --------
Total equity shareholders' funds                145,393       140,833
                                                                     
Minority interests                                2,389         1,527
                                               --------      --------
                                                147,782       142,360
                                               ========      ========



CONSOLIDATED CASH FLOW
FOR THE YEAR ENDED 31 MARCH 2001

                                             Year ended    Year ended
                                               31 March      31 March
                                                   2001          2000
                                                     £m            £m
                                                                     
Net cash inflow from operating                                       
  activities (Note 7)                             4,587         2,510
Dividends received from joint                                        
  ventures and associated undertakings              353           236
Net cash outflow for returns on                                      
  investments and
  servicing of finance                             (47)         (406)
Taxation                                        (1,585)         (325)
Net cash outflow for capital expenditure                             
  and financial investment (Note 8)            (19,011)         (756)
Net cash inflow/(outflow) for                                        
  acquisitions and disposals (Note 9)            30,653       (4,756)
Equity dividends paid                             (773)         (221)
                                               --------      --------
Cash inflow/(outflow) before                                         
  management of liquid
  resources and financing                        14,177       (3,718)
                                                                     
Management of liquid resources                  (7,541)          (33)
                                                                     
Net cash inflow/(outflow) from financing:                            
  Issue of ordinary share capital                    65           362
  Issue of shares to minorities                      44            37
  (Decrease)/increase in debt due                                    
    within one year                             (4,774)           149
  (Decrease)/increase in debt due                                    
    after more than one year                    (2,026)         3,319
                                               --------      --------
(Decrease)/increase in cash in the year            (55)           116
                                               ========      ========
                                                                     
Reconciliation of net cash flow to                                   
  movement in net debt
(Decrease)/increase in cash in the year            (55)           116
Cash outflow/(inflow) from                                           
  decrease/(increase) in debt                     6,800       (3,468)
Cash outflow from management of liquid            
  resources                                       7,541            33
                                               --------      --------
                                                                     
Decrease/(increase) in net debt resulting        
  from cash flows                                14,286       (3,319)
                                                                     
Debt acquired on acquisition of                (13,726)       (2,133)
subsidiaries
Translation difference                            (629)           316
Other movements                                    (10)             1
                                               --------      --------
Increase in net debt in the year                   (79)       (5,135)
                                                                     
Opening net debt                                (6,643)       (1,508)
                                               --------      --------
Closing net debt (Note 10)                      (6,722)       (6,643)
                                               ========      ========


CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 31 MARCH 2001


                                             Year ended    Year ended
                                               31 March      31 March
                                                   2001          2000
                                                     £m            £m
                                                                     
(Loss)/profit for the financial year                                 
-  Group                                        (8,658)           914
-  Share of joint ventures and                                       
     associated undertakings                    (1,105)         (427)
                                               --------      --------
                                                (9,763)           487
                                               --------      --------
Currency translation                                                 
-  Group                                          2,743         (355)
-  Share of joint ventures and                                       
     associated undertakings                      2,454         (775)
                                               --------      --------
                                                  5,197       (1,130)
                                               --------      --------
Total recognised gains and losses for                                
  the year                                      (4,566)         (643)
                                               ========      ========
                                                                     
                                                                     
                                                                     
MOVEMENTS IN EQUITY SHAREHOLDERS' FUNDS                              
  FOR THE YEAR ENDED 31 MARCH 2001
                                                                     
                                                                     
(Loss)/profit for the financial year            (9,763)           487
Equity dividends                                  (887)         (620)
                                               --------      --------
                                               (10,650)         (133)
                                                                     
Currency translation                              5,197       (1,130)
New share capital subscribed                      8,972       140,037
Scrip dividends                                      67            81
Goodwill transferred to the profit                                   
  and loss account in
  respect of business disposals                       1            18
Unvested option consideration                         -         1,165
Shares to be issued                                 978             -
Other                                               (5)          (20)
                                               --------      --------
Net movement in equity shareholders'              4,560       140,018
funds
                                                                     
Opening equity shareholders' funds              140,833           815
                                               --------      --------
Closing equity shareholders' funds              145,393       140,833
                                               ========      ========




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