4th Nov 2021 09:08
(Alliance News) - Telecommunications firm BT Group PLC on Thursday confirmed its financial outlook for the full year, despite a slight slip in earnings in the first half.
BT reported a 2.7% dip in revenue for the six months to September 30 to GBP10.31 billion, driven by a revenue decline in Enterprise & Global. Pretax profit slipped 5.0% to GBP1.01 billion, primarily due to higher finance expenses.
Adjusted earnings before interest, tax, depreciation and amortization totalled GBP3.75 billion, up 0.7% year-on-year, with the revenue decline more than offset by lower costs from the company's restructuring programmes and cost management, and from lower indirect commissions.
BT said it hit its GBP1 billion of gross annualised savings target 18 months earlier than planned, at a cost of GBP571 million. It has brought forward its 2025 financial year target of achieving GBP2 billion in gross annualised savings to 2024, and peak capital expenditure from 2023 is now expected to be GBP4.8 billion, down from GBP5 billion seen previously.
It also reported record Openreach 'fibre to the premises' build in the second quarter, to bring its footprint to nearly six million. As a result, BT said it has decided to retain 100% of the project for shareholders and to remain fully focused on driving build and take-up.
Back in May, the London-based company explored the creation of a joint venture to fund the roll-out of fibre to an additional five million premises. BT said on Thursday it has conducted an extensive review and held discussions with prospective investors, but has decided not to proceed due to costs coming down and take-up ahead of expectations.
Ten communication providers, including Sky and TalkTalk have signed up to Openreach's Equinox long-term FTTP pricing offer.
In addition, BT launched Eagle-i, its flagship security platform that will predict and prevent cyber-attacks for enterprises.
"BT is on track and with results in-line with our expectations, we are today confirming our financial outlook for financial 2022 and financial 2023," said Chief Executive Philip Jansen.
"Looking further out, as we pass the peak of our fibre build and move towards an all-fibre, all-IP network, we expect a reduction in capex of at least GBP1 billion and lower operating costs of GBP500 million. From these two factors alone, by the end of the decade we expect an expansion of at least GBP1.5 billion in normalised free cash flow compared to financial 2022."
BT reinstated its dividend with an interim payout of 2.31p per share.
The stock was trading 5.6% higher in London on Thursday morning at 150.10 pence a share, the best performer in the FTSE 100 index, which was up 0.4%.
By Evelina Grecenko; [email protected]
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