Vodafone Australia records AU$800m loss

Vodafone Australia records AU$800m loss

Summary: Vodafone Australia's parent company Hutchison has revealed that the troubled company lost AU$817.6 million in 2012.

TOPICS: Telcos, Australia

Vodafone Hutchison Australia's (VHA) 50 percent owner Hutchison Telecoms has revealed the extent of the company's financial woes in 2012, recording a total loss of AU$817.6 million.

The report revealed that in the 12 months to December 31, 2012, Vodafone lost 443,000 customers and saw customer revenue decrease by 16.8 percent year on year to AU$1.7 billion.

The numbers confirm the details released by Vodafone Australia's other owner, Vodafone Group, earlier this month. Including resellers, Vodafone's customer base now stands at 6.6 million.

Vodafone has been working to turn around its fortunes, and in 2012, the company completed an overhaul of its 3G network, and has now rolled out DC-HSPA+ or "3G+" to 60 percent of the Vodafone network. Vodafone also reported that call dropouts have reduced by one third in metro areas, and complaints to the Telecommunications Industry Ombudsman (TIO) decreased by 37 percent in 2012.

The company has AU$1.6 billion worth of borrowings due for repayment in June this year, and the telecommunications company is in discussions to refinance the loan, with both parent companies committing to providing funding for Vodafone's network improvements.

Vodafone is also due to launch its 4G network sometime this year, with the company beginning to test out its network in parts of Sydney.

Hutchison's chairman Channing Fok said that Vodafone Australia's turnaround plan has the full support of Hutchison and Vodafone Group.

"VHA is implementing a turnaround plan with the full support of both its shareholders, and has made meaningful inroads to stabilising customer numbers and financial performance. Although continuing losses are anticipated in 2013, [Hutchison] expects improvements in VHA's performance through the year and into 2014."

The results come as law firm Piper Alderman is set to announce this morning that it will commence a class-action lawsuit against Vodafone over its 3G network problems stemming back to 2010. Despite initially indicating that it would only take 10 business days to assess the case, the firm took over two years to put together its suit against the telecommunications company, after getting over 20,000 customers to express interest in pursuing action against Vodafone.

Vodafone said that it was aware that "a law firm which is known for promoting class actions" was repeating its plans to proceed with action against the telco, but said that the firm had not contacted Vodafone since 2010, or provided Vodafone with any of the details of the class action.

"Vodafone would like to hear from any customer who has encountered difficulties with the network and we encourage customers, past and current, to contact us directly so that we can discuss ways to resolve any concerns they have," Vodafone said in a statement.

Topics: Telcos, Australia


Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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  • Off a cliff ....

    When you look at the numbers just released the decline of Vodafone has accelerated in the past 12 months and certainly shows no signs of improving. The company can say what they like about complaints dropping but the fact to be considered is that in losing 443,000 they lost a lot of those that had or would complain so the numbers are artificial to say the least. The acceleration of the decline is inline with the change over of the CEO's back in February. Since coming into the role Bill Morrow has effectively removed all of the previous key executives and replaced them with his own imports .... look how successful that has been. He has also played a game of bluff with the government and lost and now faces the prospect of putting Vodafone into a permanent position of an inferior network once the 700Mhz becomes available to use. His public statements about needing to improve and spending more on the network and so on has done nothing but scare any prospective customers away because 443,000 customers leaving takes into account any new customers who joined as it is a nett so the number not being retained by Vodafone must be very scary. None of this is surprising to anyone working at Vodafone as good staff have been let go , fired, made redundant by a non-caring executive group who have tried to make themselves look in control to the owners. The loss of experience and intellectual knowledge of the business since Morrow ( AKA Sol Tujillo) took over is disgraceful and the major reason why this bunch have no hope of turning this around in a way that compensates for the stunning losses being experienced and disgraceful way staff have been treated. No doubt this will end up as a case study of how not to turn a business around.
    • Theres nothing wrong with Bill Morrow.

      While Bill Morrow removed all previous executives it was because IT WASNT HIS DECISION. He had no say in the matter and was ordered directly by shareholders to remove all previous leadership. The company is in this mess BECAUSE of those previous directors. Dews and Co had no idea what they were doing other than running a very expensive experiment at the behest of myself and other shareholders.

      700mhz is not the be-all and end-all of spectrum. Having 20mhz of capable spectrum in 1800mhz is very valuable because it will give serious bargaining time for 4G. Theres nothing wrong with 1800mhz, not only to mention that 1800mhz 2G is due for spectrum reallocation in 2014. More 4G space. The thing people dont realise about Vodafone because of the recent issues is that they do infact have more sites closer together than Optus itself - hence the roaming agreement. While Vodafone is continuing to flounder and costing me money, the direction they have taken is one of both Bill Morrow AND the shareholder base's directive.

      You complain about numbers in the order of 800 million and 443k customers - these are small. They are not in magnitudes which will cripple Vodafone in any way, the shareholder base I've spoken to every week since this event started in 2010 has been continuously supportive of Morrow because he's up for CEO of Vodafone Group IF he can get this shit sorted. Seems fair compensation for me, I've got no problem in providing more money to a man with a proven track record of fixing company assets.