• 13 May 2021

    Philip Jansen, Chief Executive, commenting on the results, said

    “BT comes out of this challenging year as a stronger business with an even greater sense of purpose. Our fantastic colleagues have shown the true colours of BT – delivering resilient connectivity, supporting families and businesses and helping to underpin the heroism of the NHS.

    A number of uncertainties have now been removed. The Wholesale Fixed Telecoms Market Review, 5G spectrum auction and the Government's tax super-deduction give us the green light to build the UK’s next generation digital infrastructure even faster; today we are increasing and accelerating our FTTP target from 20m to 25m homes and businesses by December 2026 to deliver further value to our shareholders and support the Government’s full fibre ambitions. The conclusion of our triennial pension valuation today provides further clarity for shareholders.

    After a number of years of tough work, and as we look to build back better from the pandemic, we’re now pivoting to consistent and predictable growth. We are building a better BT for our customers, for the country, for our shareholders and for those who work for this great company – now and in the future.”

    Key strategic developments:

    • Ofcom's WFTMR1, outcome of recent spectrum auction and Government’s tax super-deduction allows us to increase and accelerate our FTTP build from 20m to 25m premises by December 2026; BT to explore potential joint venture for additional 5m build - see separate press release
    • Agreed triennial pension deficit of £7.98bn and deficit recovery plan comprising: asset-backed funding over 13 years (£180m p.a.) secured against the EE business; and further payments over 10 years (£900m p.a. reducing to £600m p.a. from 1 July 2024) - see separate press release
    • Secured 80MHz of 5G spectrum for a total of £475m in Ofcom's auction allowing us to build on our position as the UK's number one 5G network
    • Significant UK cash tax benefit in 2021/22 and 2022/23, as a large proportion of our capital expenditure is expected to qualify for the proposed 130% tax super-deduction

    Strong operational performance during the Covid-19 pandemic:

    • Strong network performance; BT's broadband networks seamlessly managed a doubling of daytime traffic due to more people being at home during the day; 42% increase in EE mobile data usage over the last 12 months
    • Group NPS2 increased by 7.8 points compared to the prior year baseline, a 19th successive quarter of growth
    • Openreach achieved 2.0m in year FTTP build with record build levels in Q4; increased FTTP connections by 73% to 905k over the last 12 months
    • 5G footprint doubled to 160 locations and 5G ready customer base now over 3.2m; EE named the Fastest Mobile Network by Uswitch in February 2021
    • Tracking ahead on our modernisation plans; delivered gross annualised savings of £764m within the first year of our three-year modernisation programme with an associated cost of £438m

    Financials delivered in line with guidance primarily impacted by Covid-19:

    • Revenue £21,331m, down 7%, primarily due to the impact of Covid-19 on Consumer and our enterprise units, ongoing legacy product declines and divestments, partly offset by higher equipment revenue and Openreach bases in fibre and Ethernet; adjusted2 revenue down 6% in line with expectation
    • Adjusted2 EBITDA £7,415m, down 6% as expected, primarily due to the fall in revenue, special frontline bonus, increased service costs and continued investment in copper-to-fibre migrations and our FTTP base, partly offset by sports rights rebates and cost savings including our modernisation programme, tight cost control, and Covid-19 mitigation actions
    • Reported profit before tax £1,804m, down 23%, primarily due to reduced EBITDA
    • Net cash inflow from operating activities £5,963m; normalised free cash flow2 £1,459m, down 27%, primarily due to reduced EBITDA, higher cash capital expenditure and adverse working capital, offset by a cash receipt from the monetisation of a non-strategic revenue stream generated from our building infrastructure and timing of tax payments
    • Capital expenditure £4,216m, up 6%, primarily due to increased network and equipment investment
    • As previously disclosed, no final dividend for 2020/21, but payments expected to resume at an annual rate of 7.7p per share in 2021/22
    • Outlook for 2021/22: adjusted2 revenue to be broadly flat year on year; adjusted2 EBITDA between £7.5bn-£7.7bn; capital expenditure c.£4.9bn; normalised free cash flow between £1.1bn-£1.3bn.

    1 See Glossary on page 3.
    2 On 1 April 2020, Supply Chain and Pelipod, which serve several parts of BT, were transferred from Enterprise to the central procurement team and as a result are now reported in Group ‘Other’ financial results. The prior year comparative for the Enterprise and Other CFU results has been restated to reflect this. Refer to the announcement on 29 June 2020 for further information.

    Webcast

    Q4 and FY 2020/21 results - webcast replay

    Presentation slides

  • 1 April 2021

  • 4 February 2021

    Key strategic developments:

    • Creation of a new technology unit - Digital - to lead our digital innovation agenda from 1 April 2021; Digital will lead the IT, process and business transformation of BT and develop and deliver new growth products, platforms and services
    • Sale agreed of selected business units in Italy
    • Continued progress on our wider modernisation programme including the creation of a standalone procurement company

    Operational:

    • Openreach’s FTTP network now reaches 4.1m premises, built at an average run rate of 42k premises passed per week in the quarter; remains on track to achieve 4.5m by March 2021
    • Openreach's first copper stop-sell now live in Salisbury, extending to 2.2m premises by January 2022
    • FTTP commercial offers extended; all of Openreach's major communications provider customers now selling FTTP with strong increase in sales in Q3; Openreach achieved record 17k FTTP orders per week
    • 5G in 125 locations and 5G  ready customer base now over 2.1m; EE has taken top spot in Rootmetrics' latest national results for the 15th consecutive time with 5G in more places than any other network according to Rootmetrics
    • Consumer fixed ARPC down 5.8% year on year due to commitments to meet our fairness agenda, investment in our long term strategic base and declining voice usage; postpaid mobile ARPC down 6.9% year on year due to increased SIM-only mix, decline in roaming and out of bundle revenue
    • In Consumer, BT brand at its highest NPS1 ever, as evidenced by strong BT sales and churn performance
    • Enterprise retail and wholesale order intakes up 8% to £3.2bn and 5% to £1.2bn respectively on a 12-month rolling basis
    • Global order intake up 1% to £4.1bn on a 12-month rolling basis 

    Financial:

    • Revenue £16,058m, down 7% due primarily to the impact of Covid-19 on Consumer and our enterprise units, ongoing legacy product declines and divestments of domestic businesses in Spain, Latin America and France
    • Adjusted1 EBITDA £5,603m, down 5%, driven by the fall in revenue, partially offset by H1 sports rights rebates, savings from our modernisation programme and other cost initiatives including Covid-19 mitigating actions
    • Reported profit before tax £1,591m, down 17%, due to reduced EBITDA
    • Normalised free cash flow1 £830m, down 17%, due to reduced EBITDA and higher cash capital expenditure, offset by a cash receipt from the monetisation of a non-strategic revenue stream generated from our building infrastructure and timing of tax payments
    • Capital expenditure up 5% to £3,030m, primarily driven by increased fixed and mobile network investment
    • Outlook for 2020/21: Unchanged except for lower end of normalised free cash flow1 outlook range raised to £1.3bn; revised range £1.3bn-£1.5bn; the EBITDA outlook range remains at £7.3bn-£7.5bn

    Philip Jansen, Chief Executive, commenting on the results, said

    During the current Covid-19 pandemic, BT has continued to deliver for our customers and invest in our networks, our modernisation programme, and our products and services in recognition of the ever increasing need for improved and faster connectivity. We delivered results in line with our expectations for the third quarter and remain on track to deliver our 2020/21 outlook despite even greater Covid-19 restrictions than previously forecast. BT has shown again that it has the spirit and determination to step up and deliver for our customers, keeping them connected with a range of initiatives. I am particularly proud of the ongoing work and investments we are making to support school children, SMEs and the NHS during the pandemic.

    We continue to make significant investments in our industry leading networks; with FTTP having now passed over 4m premises and 5G available in 125 towns and cities, we're firmly on track to deliver our March 2021 targets. Openreach FTTP orders accelerated even further to reach another record level of 17k per week. We have demonstrated continued improvement in our operational performance, including acceleration of FTTP and 5G take-up, and customer satisfaction metrics. This reflects our progress in creating valued, reliable, stand out customer experiences and propositions; the next evolution of our flagship convergence proposition, Halo 3+, will drive even further progress.

    As the WFTMR2 consultation process draws to a close we're focused on ensuring the new regulation will create an environment to allow for fair returns across our industry including the additional significant network investment we are poised to undertake. The latest proposals from Ofcom are positive for investment in many areas, but there are key points of clarity still needed to unlock the fibre investment the country needs; and we still need to see concrete progress from Government on the things they can do to support the fibre roll out.

    With no material impact expected from the Brexit deal and our resilient results so far this year I remain confident in our EBITDA expectation of at least £7.9bn for 2022/23. Looking further ahead our new Digital unit will enable us to accelerate our digital and business transformation programmes and to deliver digital platforms that bring together best-in-class services for our customers, further securing a brighter and more sustainable future for the group.

    1 See Glossary on page 5
    2 Wholesale Fixed Telecoms Market Review

     

  • 2 December 2020

    Webcast

  • 4 November 2020

  • 29 October 2020

    Key strategic developments:

    • All of Openreach's major CP1 customers now selling FTTP with strong increase in sales in Q2
    • Consumer aligns pricing policies across all products and services to CPI plus 3.9% per annum to provide consistent, predictable pricing for new and regrading customers and to support network investment

    Operational:

    • Strong operating performance despite the ongoing impact of Covid-19
    • FTTP rollout reached record levels in Q2 with run-rate of 40k premises per week; 3.5m premises passed to date
    • Openreach to stop selling copper products to c.1.8m FTTP-enabled premises by September 2021 latest 
    • 5G-ready customer base now over 1m and 5G now live in 112 towns and cities
    • Strong increase in Consumer FTTP customer base up 60% year on year; fixed and mobile convergence at 21.4%
    • Enterprise agrees landmark partnership with Belfast Harbour to deploy 5G Private Network
    • Modernisation programme delivers £352m gross annualised savings at a cost of £163m

    Financial:

    • Revenue relatively resilient at £10,590m, down 8%, primarily due to the impact of Covid-19 including reduced BT Sport revenue and a reduction in business activity in our enterprise units, and declines in legacy products
    • Adjusted2 EBITDA £3,721m, down 5%, driven by the fall in revenue, partly offset by sports rights rebates, savings from our modernisation programme and other cost initiatives including Covid-19 mitigating actions
    • Reported profit before tax £1,062m, down 20%, driven primarily by reduced EBITDA
    • Net cash inflow from operating activities £2,713m;  normalised free cash flow2 £422m, down 30%, primarily due to reduced EBITDA and offsetting movements in working capital and timing of tax payments
    • Capital expenditure £1,969m, up 5%, primarily driven by fixed and mobile network investment
    • Lower end of the adjusted2 EBITDA outlook range for 2020/21 raised to £7.3bn; revised range £7.3bn - £7.5bn
    • Adjusted2 EBITDA outlook of at least £7.9bn in 2022/23, underpins planned reinstated dividend from 2021/22 and value-creating investment plans

    1 Communications provider
    2 See Glossary on page 2

     

    Philip Jansen, Chief Executive, commenting on the results, said

    "BT delivered financial results in-line with expectations for the first half of the year, thanks to strong operational performance during exceptional circumstances. Customer demand during the pandemic has shown how critical our networks have become, and our significant network investments have helped us double the number of Openreach’s FTTP orders compared to this time last year and have seen our leading 5G network expand to 112 towns and cities across the UK.

    "We continue to invest to make BT more competitive and I’m pleased to see the quality of our products and services improving. At the same time we are firmly on track with the delivery of our modernisation programme and have delivered £352m in cost savings in the first half of the year.

    "This performance has given us confidence to raise the lower end of our EBITDA outlook range for this year and publish an EBITDA expectation of at least £7.9bn for 2022/23, with sustainable growth from this level forward. This growth will be driven by the continued recovery from Covid-19, enhanced by sales of our converged and growth products, and by significant savings from our modernisation and cost saving programme. In combination these factors will more than offset legacy product declines.

    "The growth in EBITDA underpins the planned reinstatement of our dividend next year whilst ensuring that we can continue to drive value-creating investments in our networks and products."

    Philip Jansen, Chief Executive sums up BT's half year results

  • 8 October 2020

  • 31 July 2020

    Key strategic developments:

    • BT delivered a strong operating performance and remains committed to supporting our customers and colleagues. Financial results impacted by Covid-19
    • Openreach committed to build FTTP to 3.2m premises in rural areas by 2025/26, subject to enablers including extension of indexation across the whole country. Continued progress towards 20m FTTP target
    • Openreach to stop selling copper products to c.1.2m FTTP-enabled premises in 117 exchange areas from June 2021
    • Further work required to comply with additional restrictions on the use of Huawei equipment but no anticipated impact on coverage or rollout of 5G and full fibre; cost expected to be absorbed within previously reported estimate of £500m
    • Enterprise launched major new scheme to support small businesses in being better positioned for growth following Covid-19
    • 16 successive quarters of improvement in Group NPS1
    • Rob Shuter appointed CEO of Enterprise unit; Gerry McQuade to retire from BT

    Operational:

    • Openreach continues FTTP rollout with 3m FTTP premises now passed; on track to achieve 4.5m by March 2021
    • Consumer fixed ARPC £36.4, down 4% year on year due to continued market competition and residential BT Sport revenue decline; postpaid mobile ARPC £19.6, down 5% due to decline in roaming and out of bundle revenues, and continued trend towards SIM-only; RGUs per address 2.41
    • Postpaid mobile and fixed churn both down to 1% in Q1 due to low market activity during lockdown

    Financial:

    • Revenue £5,248m, down 7% primarily due to the impact of Covid-19, including reduced BT Sport revenue and a reduction in business activity in our enterprise units
    • Adjusted1 EBITDA £1,813m, down 7%, driven by the fall in revenue and continued investment in customer experience, partly offset by Covid-19 mitigating actions and savings from our transformation programmes
    • Reported profit before tax £561m, down 13%, due to reduced EBITDA, higher interest expense, and higher depreciation and amortisation charges; partly offset by the gain on disposal of our Spanish operations
    • Negative Q1 normalised free cash flow1 reflects Covid-19 pressures on EBITDA combined with the usual Q1 pressures on working capital due to the timing of public sector collections, capex creditors and payment of management bonus. Normalised free cash flow1 declined by £372m to an outflow of £(49)m driven by Covid-19 impacts on EBITDA and extended customer payment terms, as well as some one-off cash flows which benefited the prior year including the upfront cash payment received from Cellnex
    • Capital expenditure broadly flat at £927m, with higher network investment offset by lower customer and non-network infrastructure spend
    • Outlook for 2020/21: adjusted1 revenue down 5% - 6%; adjusted1 EBITDA £7.2bn - £7.5bn; reported capital expenditure £4.0bn - £4.3bn; normalised free cash flow1£1.2bn - £1.5bn

    1 See Glossary on page 5

     

    Philip Jansen, Chief Executive, commenting on the results, said

    "Despite Covid-19, BT delivered a strong operating performance in the first quarter and delivered a relatively resilient set of financial results. We continue to invest in the long-term future of the business. We continued to support our customers and colleagues through the crisis, including offering NHS workers on EE unlimited mobile data, and discounts for pubs and clubs on BT Sport until the end of the year. During the quarter Openreach resumed provisioning and repair activity in customer premises, we re-opened the majority of our retail stores, and we saw the restart of the Premier League on BT Sport. Enterprise has today launched the BT Small Business Support Scheme, which will boost cash flow, connectivity and confidence among this critical segment of the economy over the coming months.

    "Throughout this crisis we remain focussed on delivering against our strategic goals to deliver long-term value for shareholders. We reached an important milestone with 3m FTTP premises now passed, welcomed Ofcom’s consultation on our rural FTTP build proposal, and have now deployed 5G to 100 towns and cities. Together with continued improvements in customer experience and our modernisation programme, we are positively positioned for the future.

    "Although uncertainties remain, we are now able to provide an outlook for this financial year. Despite our strong operational performance in the first three months of the year, it is clear that Covid-19 will continue to impact our business as the full economic consequences unfold. Beyond this year and based on current expectations, we expect to return the business to sustainable adjusted EBITDA growth, driven in part by the recovery from Covid-19."

    Slides

  • 7 July 2020

  • 29 June 2020