- Revenue growth of 1%
- EBITDA decline due to an unacceptable performance in BT Global Services
- Rest of the business delivered good performance with EBITDA growth of 4%, driven by 9% reduction in operating costs
- Total charges of £1.3bn as a result of the completion of contract and financial reviews in BT Global Services
- Specific item charge of £280m relating to the restructuring of BT Global Services, further restructuring charges of approximately £420m in total over the next two financial years
- BT’s retail share of the DSL and LLU net additions at 42% in the quarter – best for four years
- BT Global Services orders of £2.6bn in the quarter and £8.0bn over the past 12 months
- Free cash flow of £1,134m in the quarter
Financial press releases, slides, KPIs and webcasts
Fourth quarter and year to 31 March 2009
Key points for the fourth quarter:
Ian Livingston, Chief Executive, commenting,, said:
“Three out of four of BT's lines of business have performed well in spite of fierce competition and the global economic downturn. However this achievement has been overshadowed by the unacceptable performance of BT Global Services and the resulting charges we have taken. During the year we have changed the leadership of BT Global Services and started to turn the division around.
“With a recovery programme for BT Global Services in place and our heightened focus on costs and customer service, we now want to accelerate our plans for our future networks. We will examine doubling the pace of the roll out of super fast broadband next year within existing capital expenditure plans, bringing fibre based services within the reach of more than a million homes and businesses and securing the jobs of a thousand BT people.
“In the coming year we will extend the record of operational delivery already demonstrated in three out of our four divisions right across the group. We expect to deliver a net reduction in operating costs and capital expenditure of well over £1 billion in 2009/10. This will enable us to generate free cash flow, before any pension deficit payments, in excess of £1 billion in 2009/10 and beyond.
“I believe BT will emerge from the recession a stronger company to the benefit of our customers and shareholders.”
Third quarter to 31 December 2008
Key points for the third quarter:
- Revenue growth of 5% driven by acquisitions and foreign exchange
- EBITDA decline due to poor performance in BT Global Services and one-off charges
- Rest of the business performed ahead of expectations, with EBITDA growth of 5% being the best year on year performance for five years
- Total one-off charges of £336m as a result of the financial and contract reviews in BT Global Services
- Completion of the ongoing contract and operational reviews may result in further substantial one-off charges in the fourth quarter
- Decisive action to improve performance in BT Global Services
- Free cash flow improved due to lower working capital outflow and lower capital expenditure
- Total labour resource reduction of 9,500 in the nine months to 31 December
- BT’s retail share of the DSL and LLU installed base remained steady at 34% (28% share of net additions in the quarter)
- BT Global Services order intake remained steady at £1.8bn in the quarter and £8.3bn over the past 12 months
Ian Livingston, Chief Executive, commenting on the third quarter results, said:
“Three of our businesses performed ahead of expectations in the quarter and the group, excluding Global Services, delivered the best year on year profit growth for five years. However, as previously announced, the group results have been severely impacted by the performance of our Global Services division.
"We need to build a solid base in Global Services from which we can deliver positive cash flows. We have already announced changes in management and are making significant financial and operational changes to the business. We are also trying to change the division's cash flow profile to ensure it’s less concentrated towards the fourth quarter and, as a result, fourth quarter cash inflow in Global Services will be significantly lower than last year's exceptionally high figure.
"With our focus on improving the performance of Global Services, continued cost savings and control on capex across the group, we expect group free cash flow, before any pension deficit payments, to be over £1bn next year.”
Second quarter and half year to 30 September 2008
Key points for the second quarter:
- Revenue of £5,303 million, up 4 per cent
- EBITDA before specific items and leaver costs of £1,429 million, down 1 per cent
- BT Global Services EBITDA before leaver costs of £119 million, down 36 per cent
- Operating profit before specific items and leaver costs of £744 million, down 1 per cent
- Profit before taxation, specific items and leaver costs of £590 million, down 11 per cent
- Earnings per share before specific items and leaver costs of 5.9 pence, down 3 per cent
- Interim dividend maintained at 5.4 pence per share
- Free cash inflow of £369 million, up by £198 million
Ian Livingston, Chief Executive, commenting on the second quarter’s results, said:
“Three out of our four business units, BT Retail, BT Wholesale and Openreach are delivering on or ahead of target. But profits in BT Global Services are simply not good enough and we are taking decisive action to put matters right. We have appointed Hanif Lalani as the new CEO of BT Global Services and he will continue to grow the business while reducing the cost base.
Demand for our BT Global Services proposition remains strong, revenue grew strongly in the quarter and the pipeline is healthy. What we have to do now is translate revenue growth into better profitability.
We continue to expect BT group revenue to grow for the full year. However because of the reduction in profitability in BT Global Services, group EBITDA2 is likely to show a small decline in the current financial year.”
First quarter to 30 June 2008
Key points for the first quarter:
- Revenue of £5,177 million, up 3 per cent
- EBITDA before specific items and leaver costs of £1,433 million, up 1 per cent
- Operating profit before specific items and leaver costs of £742 million, up 4 per cent
- Profit before taxation, specific items and leaver costs of £613 million, down 7 per cent
- Earnings per share before specific items and leaver costs of 6.1 pence, up 2 per cent
- Free cash outflow of £734 million
- 13.0 million broadband end users2 of which BT’s retail share was 35 per cent, with 31 per cent of net additions in the quarter
Ian Livingston, Chief Executive, commenting on the first quarter results, said:
“BT has continued to grow revenue, EBITDA3 and earnings per share3 in the first quarter.
BT Global Services has increased revenue by 13 per cent with strong growth of 33 per cent outside the UK. We achieved total contract wins of £8.2 billion over the last twelve months, and the pipeline of new business remains strong.
BT Retail performed well with revenue growth of 3 per cent and double digit profit growth. BT Wholesale has won managed network solutions contracts of £1.2 billion over the last twelve months.
We are committed to delivering long term shareholder value and will continue to invest in the future growth of our business. We have announced plans to invest £1.5 billion to make fibre-based, super-fast broadband available to as many as 10 million homes in the UK by 2012, dependent upon an appropriate regulatory environment.
Our full year guidance remains unchanged - we continue to expect to deliver growth in revenue, EBITDA3, earnings per share3 and dividends per share in this financial year.”