At the 2006 AGM Chairman Sir Christopher Bland and his fellow Board members answered questions from shareholders on a wide range of issues, including:
Questions from the 2006 AGM held at London’s Barbican Centre on 12th July 2006
The regulatory environment and fair competition in the marketplace
A shareholder pointed out that, following the reorganisation of BT and the creation of Openreach, a great deal of regulatory pressure now appeared to be being placed on Openreach and asked the Chairman if he considered the situation to be reasonable. Sir Christopher Bland told the meeting that he did consider the situation to be fair. Following the Ofcom review and it’s acceptance of the set of legally binding undertakings that BT proposed, the most heavily regulated parts of BT are now contained within Openreach and the aim of that part of BT is to deliver maximum value for shareholders within an appropriately regulated environment. As a result of the Undertakings and its strategic review Ofcom is now able to begin to consider deregulation outside the Openreach line of business.
Sir Christopher was asked whether he considered BT’s customer service to be at the highest possible standard. The Chairman informed the meeting that constantly improving customer service is a very high priority. He pointed out that whilst there is always room for improvement he believed that BT’s customer service is one of the best in the UK. BT has over 21m customers in the UK and deals with around 1m enquiries a week. To do this well requires a combination of the best in personal service allied with latest call handling technology. Clearly connecting a customer to the person they need to talk to in the quickest and most efficient manner is key. That is why constant improvements to automated call systems are under review with an aim to reduce waiting time to a minimum.
Competitive pricing on Broadband
A shareholder asked if BT was offering the most competitive pricing on Broadband services- especially when other operators seem to be offering free services. The Chairman pointed out that very rarely is anything really for free and advised customers to read the small print very carefully. BT’s offering includes a number of extras including free internet calls, WiFi, BT Fusion and, in the autumn, BT Vision.
Sir Christopher was asked by a shareholder if BT’s research facilities at Adastral Park was doing a effective job and delivering a good return on the investment made in it. The meeting was informed that independent research had placed BT in the top three most innovative companies in the world. The partnership approach to product and service development that lies at the core of the Adastral Park facility has resulted in a solution-oriented route to innovation that has resulted in a notable increase in the registration of new patents.
A bright future for BT Global
The Chairman was asked to comment on a recently announced deal for BT Wholesale in Japan. Sir Christopher asked Andy Green to reply and he informed the meeting that the deal with KDDI in Japan was a joint venture that brought BT’s expertise together with invaluable local market knowledge. The deal was typical of the exciting events talking place in BT Global at present.
Young people and the future
A shareholder asked if BT still offered places to apprentices. The Chairman confirmed that BT does indeed offer training and career opportunities to young people from many different backgrounds. In addition BT is very proud to support a very wide range of exciting initiatives with young people that help develop their communication skills. These initiatives involve partnerships with schools and other establishments that ensure young people also have an opportunity to influence how BT develops it own future.
Share price and performance
A shareholder asked if the Board considered the company’s share price to be fair considering how well BT was performing. The Chairman agreed that the share price was lower than he would like- but also pointed out that neither he nor the Board set the price. He said that he believed that it is now moving in the right direction and pointed out that it now sits at a four year high. BT’s performance has shown 16 consecutive quarters of earnings per share growth, and total shareholder return (up 9.1% over the year to 30 June), has outperformed the Euro Telco sector (down 2% over the same period). Thus far BT’s excellent performance has not translated into a higher share price but he hoped, on behalf of all shareholders, that it soon would.
The Chairman was asked why there was only one woman on the Board of Directors. Sir Christopher pointed out that this was one more than when he became Chairman. He also confirmed that the company is actively seeking to recruit another. Diversity on the board is being addressed, however clearly it is important that this must also be balanced against the skills needed at Board level. BT has an excellent record as a fair and diverse employee and Sir Christopher made it clear that he wished to see this also reflected at Board level.