BT Group maintains guidance, says turnaround programme on track

Writer, Stock Market Wire
Thursday, January 31, 2019 - 07:55

BT Group on Thursday maintained its guidance after reporting a 20% rise in pre-tax profits despite a fall in revenues on the back of regulated price reductions in Openreach and declines in its enterprise businesses.

For the nine months to 31 December, pre-tax profits rose 20% to £2.09bn, revenue fell 1% to £17.6bn and earnings (EBITDA) rose to £5.55bn from £5.42bn.

The company said initiatives to transform its operating model were on track as the restructuring programme removed about 800 jobs in the third quarter.

Reported capital expenditure was up £239m to £2,810m as the company ramped up the roll out of its fibre connections in 14 locations under and had recently announced a further 11 locations, bringing the total to 25.

The net pension deficit grew to £5.0bn from £4.5bn mainly reflecting a fall in the real discount rate and a fall in assets.

CEO Gavin Patterson, who will be replaced by Philip Jansen from 1 February 2019, said the outlook for the full year was unchanged, though expected cost inflation and legacy product declines to weigh on short-term growth.

'Our overall outlook for the full year remains unchanged, with EBITDA around the top end of our guidance for FY 2018/19. We continue to expect regulation, market dynamics, cost inflation and legacy product declines to impact in the short term before being more than offset by improved trading and cost transformation by our 2020/21 financial year.'

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