Vodafone incurs loss; to cut 400 jobs

Vodafone, the mobile phone giant headed by NRI chief executive Arun Sarin, on Tuesday announced annual losses of 14.85 billion pounds and said it planned to cut 400 jobs at its headquarters in Newbury in the UK.

The massive bottom-line deficit was caused by the company writing down the value of its assets, including the worth of its £100 billion acquisition of Germany's Mannesmann in 2000.

Vodafone wrote down £23.5 billion in its accounts, but ahead of that charge it achieved profits of £8.79 billion for the year to March 31, compared with £7.8 billion a year earlier.

The bottom-line figure of £14.85 billion compares with the previous low from the company of £13.54 billion in 2002, when it reported a number of non-cash exceptional items.

Sarin said the underlying performance of the group remained good after outperforming its competitors in an "increasingly challenging marketplace".

He also outlined an updated strategy for the business as Vodafone looks to tackle slowing revenue growth from its existing mobile operations and also address the impact of competition from broadband.

Vodafone said it would look to target new sources of revenue, including through packages to meet customers' growing voice and broadband data service needs.

The company also announced a plan to cut costs through outsourcing and the reduction of group overheads, including through the loss of 400 jobs at its corporate centre in Newbury, Berkshire.