25th Jul 2024 10:49
(Alliance News) - BT Group PLC on Thursday touted progress in its fibre roll-out, but said legacy issues and pressures in its Business and Consumer units meant revenue fell.
In the three months to June 30, the London-based telecommunications provider said reported pretax profit fell 3.0% to GBP520 million from GBP536 million a year prior. Decreased revenue was broadly offset by a reduction in reported operating costs, BT noted.
Adjusted revenue fell 2.1% to GBP5.05 billion from GBP5.16 billion. This was due to legacy managed contract declines, reduced low margin sales activity and contraction in the business unit, the company said in a statement.
BT also noted a continued shift to mobile SIM only deals and a lower consumer price index benefit in a "competitive market" in consumer.
This was partly offset by price increases and first-to-the-post and ethernet base growth in Openreach, BT added.
Adjusted earnings before interest, tax, depreciation and amortisation rose 1.5% to GBP2.06 billion GBP2.03 billion with tight cost control, including lower staff costs, partly offset by the revenue decline.
BT flagged a record FTTP build of over 1 million premises passed in the quarter at an average build rate of 78,000 per week. The FTTP footprint is now 15 million, BT said.
The company said FTTP demand was strong with orders up 29% year-on-year with net adds of 387,000 in the quarter.
Openreach broadband average revenue per user grew by 6% year-on-year due to price rises and increased volumes of FTTP.
But Openreach broadband line losses of 196,000 reflected higher competitor losses combined with a weaker overall broadband and new homes market, the firm said.
The Business arm continues to be impacted by legacy managed contract declines and reduced low margin sales activity, BT added.
Chief Executive Allison Kirkby reflected on a "solid" start to the financial year, noting "excellent growth in both fibre build and connections, and increased Ebitda."
"Our ongoing cost transformation contributed to Ebitda growth, and more than offset the expected revenue declines in Consumer and Business in the quarter," she added.
Kirkby said BT was "on track to deliver our financial outlook for this year", but stressed "there is much more to do to simplify BT Group and deliver for our customers."
Shares in BT fell 2.9% to 135.65 pence in London on Thursday. The wider FTSE 100 was down 0.9%.
By Jeremy Cutler, Alliance News reporter
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