On December 31, Nick Read will leave his position as CEO of the Vodafone Group. He will continue to serve as a board adviser until March 2023.
Margherita Della Valle, the organization’s CFO, has been named the interim Group CEO and will hold both positions until a new CEO is chosen. In a statement, Vodafone stated that “she will quicken the execution of the company’s plan to improve operational performance and deliver shareholder value.”
Read has been a Vodafone employee for more than 20 years.
Vodafone Chairman Jean-François van Boxmeer said, “During his four years as CEO, he led Vodafone through the pandemic, ensuring that our customers remained connected with their families and businesses. He has focused Vodafone in Europe and Africa as a converged connectivity provider and led the industry in Europe in unlocking value from tower infrastructure.”
Nick Read’s current base income is £1,081,500 ($1,136,964) a year, plus a bonus that can be up to 200% of base pay, along with other incentive programmes and benefits, according to compensation data disclosed by Vodafone. Della Valle’s pay will be increased to correspond with Read’s.
This morning, New Street Research analyst James Ratzer wrote: “The board has concluded clearly that a new leader can bring greater performance for the company. Finally, we believe that delayed M&A delivery and German fixed-line performance are the areas where things failed.
In November, Read revealed that the business encountered a slump in Europe during its fiscal Q2 2023 results call. And he said that it was taking steps like preparing and adjusting its price plans to account for inflation and planning to reduce its costs by €1 billion over the next 3.5 years.
Ratzer said New Street agrees with the board that the number one priority should be to improve the operational performance of the company. “We are supportive of Vodafone’s intention to lift pricing in a lot of its markets and also launch a renewed cost-cutting program.”
In comparison to the mobile industry, Read leaves Vodafone in a better position than he did, he continued.
The merger of Vodafone and Three in the UK is currently being discussed.
The plan for fixed line in Germany, according to Ratzer, will present the largest challenge for a new CEO. He added that recent IT issues with the new Telecom Law’s deployment were a major contributing factor. “Part of this has been pushed by the pandemic pressuring all German rivals vs DT,” he said.
From the perspective of its shareholders, New Street is worried about the capital expenditures of adding more fiber and would prefer a DOCSIS upgrade path.