BT Group has reported its FY numbers. Revenue stood at £20.8 billion (€24.2bn), up 1 per cent YoY, and adjusted revenue at £20.8 billion, up 2 per cent on a pro forma basis attributed to price increases and fibre-enabled product sales in Openreach, increased service revenue in Consumer with annual contractual price rises being aided by higher roaming and increased FTTP connections, and partly offset by legacy product declines and a one-off revenue adjustment in Business.

Allison Kirkby, Chief Executive, commented: “BT Group built and connected customers to our next generation networks at record speed and efficiency over the past year, while continuing to grow revenue and EBITDA. Having passed peak capex on our full fibre broadband rollout and achieved our £3 billion cost and service transformation programme a year ahead of schedule, we’ve now reached the inflection point on our long-term strategy. This delivery and greater capex efficiency gives us the confidence to provide new guidance for significantly increased short term cash flow and sets out a path to more than double our normalised free cash flow over the next five years. This enhanced cash flow allows us to increase our dividend for FY24 by 3.9 per cent to 8 pence per share. We’re also setting a further £3 billion of gross annualised cost savings to be reached by the end of FY29.”

“As we move into the next phase of BT Group’s transformation, we are sharpening our focus to be better for our customers and the country, by accelerating the modernisation of our operations, and by exploring options to optimise our global business. This will create a simpler BT Group, fully focused on connecting the UK, and well positioned to generate significant growth for all our stakeholders,” added Kirby.

FY highlights include:

• FTTP build rate accelerated to 1 millio premises passed in the quarter, a record 78k per week. FTTP footprint now over 14 million premises with a further 6 million where initial build is underway; on track to reach 25 million by December 2026. Department for Science, Innovation and Technology has notified Openreach of its preferred bidder status for Project Gigabit cross-regional supplier contract.
• Strong Openreach customer demand for FTTP with net adds of 397k in Q4; total premises connected now over 4.8 million with increased take-up rate of 34 per cent.
• Openreach broadband ARPU in FY24 grew year-on-year by 10 per cent to £15.1 due to price rises and increased volumes and mix of FTTP; Openreach broadband line losses of 491k, a 2 per cent decline in the broadband base, as weaker than expected growth in the broadband market in FY24 did not offset competitor losses which were at comparable levels to FY23; BT expects that the broadband market will recover over the medium term but if it remains weak over the next 12 months then BT expects Openreach’s broadband base to be impacted by moderately higher competitor losses.
• Consumer broadband ARPU in FY24 increased 5 per cent year-on-year to £41.2; Consumer postpaid mobile ARPU increased 9 per cent year-on-year to £19.4; monthly churn for the year remained stable in a competitive market with broadband and postpaid mobile both at 1.1 per cent.
• Business financial performance continues to be impacted by higher input costs, legacy declines, a one off revenue adjustment and prior year one-offs, partly offset by cost transformation and growth in Small & Medium Business (SMB) and Security.
• Retail FTTP base grew year-on-year by 40 per cent to 2.6 million of which Consumer 2.4 million and Business 0.2 million; 5G base 11.1 million, up 29 per cent year-on-year
• Cost transformation target of £3 billion gross annualised cost savings since May 2020 achieved 12 months early, at a cost to achieve of £1.5 billion, £0.1 billion lower than target. Announced further £3 billion gross annualised cost savings by end FY29 at a cost to achieve of £1 billion
• BT Group NPS of 24, up 1.0pts year-on-year, further improving customer experience

Commenting on the results, Neil Shah, Executive Director of Content and Strategy at Edison Group, said:  BT Group’s reported £20.8 billion revenue, up 1 per cent from the previous year, with its consumer revenue showing adjust revenue growth of 4 per cent and showing strong operational performance. Its FTTP base grew to 683k during the year; up 18 per cent year-on-year. However, its business financial performance continued to be impacted, showing pressure reflecting higher input costs and legacy declines, showing 2 per cent decline in adjusted revenue. This was offset by cost transformation and growth in Small & Medium Business (SMB) and Security.”

“This year, BT faced strong geopolitical tension, with conflict in the Middle East region amplifying a wide range of potential impacts, including disruption to suppliers, higher energy costs and increased cyber security threats. This is expected to be a continued risk factor in the future. Moving forward, BT Group’s new guidance for increased short term cash flow and outlook show its desire to deliver consistent growth. BT Group has announced its plans to focus on the UK on the business side, focusing on strong commercial opportunities in the growth of the international secure multicloud market. It will be interesting to see the impact of continued geopolitical tensions, changing technology and other operational costs on BT’s growth,” added Shah.

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Tags: bt, BT Group, kirby, Openreach