Vodafone's cash flow pledge eases concerns over dividend

London

VODAFONE Group promised to milk more of the cash that flows through the world's second-largest mobile phone operation and funnel it back to shareholders after years of investment and expansion.

The stock rose the most in 10 months on Tuesday after the Newbury, England-based carrier forecast a 23 per cent increase in free cash flow to 5 billion euros (S$7.7 billion) this year and continued growth of its dividend.

The pledge eases concerns about the dividend's sustainability, after some analysts had raised the prospect of a cut. Chief executive officer Vittorio Colao is reining in costs, making deals to boost profit and slowing the pace of network investments, leaving him enough ca…