2/5/2009 3:12:00 PM
Vodafone scraps managers' bonuses and the employee performance plan
Vodafone is scrapping managers’ bonuses and the employee performance plan, in light of the mediocre results for the final three months of 2008 unveiled this week.
The bad news on bonuses was delivered as revenue dipped 0.7% to £1.23bn, compared with £1.24bn in the same period in 2008; however, the level of decline is reducing, offering an encouraging sign of improvement.
The UK division is expected to play a central role in plans for the group to find £1bn in cost savings.
Vodafone’s UK finance chief, Mark Evans (pictured), told staff in an email: ‘It’s essential we look to make radical steps in our cost efficiency. With revenue falling, and the economy getting tougher by the week, we must look at every pound we invest in this business.
‘Only efficient companies will survive this tough market place, and it’s
vital we look at every aspect of our operating model.’
Vodafone has appeared to suffer by getting caught up in a price war with cheaper rivals. Voice revenues were down 7% to £787m, down £64m from the same period last year.
Vodafone’s prepay also took a battering, with a loss of 158,000 active pay-as-you-go customers during the Christmas period. The company blamed this on ‘a contracting prepay market and the economic situation deteriorating’.
The fall in Vodafone’s revenue could have been even sharper without the success of MVNOs Asda and Lebara, which run on Vodafone’s network, and dongle sales, which took the operator’s data revenues up by 31% from the same period last year.
Vodafone’s exclusive on the BlackBerry Storm has given Vodafone a 60% share of the BlackBerry market, with 125,000 devices sold to date, the company said.