Vodafone losses soar to £14.9bn

Vodafone chief Arun Sarin said that the firm is "reviewing its strategy" in Europe

Vodafone has announced losses of £14.9bn before tax, despite a 6.7 per cent increase in total telecoms sales which boosted revenues to £28.1bn. 

The firm announced a strategy update to deal with its losses in which it will outsource services such as application development and maintenance to reduce overheads in Europe.

Vodafone also plans to enter the fixed-phone market to offer a package of converged services to businesses and consumers.

"We have been reviewing our strategy given our continuing desire to meet our customers' changing requirements," said Vodafone chief executive Arun Sarin.

"I am encouraged by the opportunity to broaden our range of services, and our more focused efforts to drive cost reduction and revenue stimulation in Europe, while we capitalise on growth opportunities in our emerging market businesses."

However, the £14.9bn loss was not bad news for investors, who are set to get a return of £3bn on top of the £6bn already promised following the sale of Vodafone Japan to Softbank.

Vodafone stressed that it will continue "delivering value and superior returns to shareholders".

"In the past year we have announced returns of £10.2bn to shareholders through dividends and buybacks, and the dividend pay out ratio has been increased to 60 per cent of earnings," the company said in its financial statement. "We have also committed to a further £9bn return via a 'B' share arrangement."