LONDON-Vodafone Group plc said it expects to file a $48 billion charge to its assets related to the value of goodwill, or the difference between an asset’s value and how much the company paid for it.
Most of the goodwill charge is expected to be attributable to Vodafone Germany; Vodafone acquired German telecom operator Mannesmann in 2000 “at a time when share prices in the telecommunications sector were significantly higher than today,” Vodafone noted. Vodafone Italy and Vodafone Japan also could be affected, the company said.
The operator also lowered its overall mobile revenue expectations. The company now expects growth between 5 and 6.5 percent for the year ending March 31, 2007, down from earlier forecasts of 6 to 9 percent growth. The company cited an increasingly competitive industry for the revised expectations.
Vodafone said that under recently adopted international accounting rules, its annual review of its assets will result in the charge, due to a “lower view of growth prospects, particularly in the medium to long term.”
