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BT: 15m premises in Openreach footprint

July 25, 2024

BT has reported adjusted Q1 revenue of £5.1 billion (€6bn), down 2 per cent on Q1 FY24 attributed to legacy managed contract declines, reduced low margin sales activity and contraction in the portfolio unit within Business, and the continued shift to mobile SIM only and a lower CPI benefit in a competitive market in Consumer. This is partly offset by price increases and FTTP and Ethernet base growth in Openreach; reported revenue £5 billion was down 2 per cent.

BT reported adjusted EBITDA of £2.1 billion, up 1 per cent with transformation and tight cost control, including lower staff costs, partly offset by revenue decline. Profit before tax stood at £520 million, down 3 per cent, with decreased revenue broadly offset by reduction in reported operating costs. The telco reconfirmed all FY25 financial outlook metrics.

Quarterly highights

  • Record FTTP build of over 1 million premises passed in the quarter at an average build rate of 78k per week; FTTP footprint is now 15 million with 4.2 million rural premises passed and around a further 6 million where initial build is underway
  • FTTP customer base surpassed 5 million during the quarter; strong FTTP demand with orders up 29 per cent year-on-year; take up rate is at 34 per cent with continued strong net adds of 387k
  • Openreach broadband ARPU grew by 6 per cent year-on-year due to price rises and increased volumes of FTTP; Openreach broadband line losses of 196k, with moderately higher competitor losses combined with a weaker overall broadband and new homes market
  • Consumer broadband ARPU up 1 per cent year-on-year to £42.4 and Consumer postpaid mobile ARPU increased 0.5 per cent year-on-year to £19.8, with positive mix effects offsetting the expected tougher pricing comparative
  • Consumer base trend improved despite a competitive market, with the broadband base down 28k quarter-on-quarter (0.3 per cent decline) and postpaid mobile base down 15k quarter-on-quarter (0.1 per cent decline)
  • Business financial performance continues to be impacted by legacy managed contract declines, reduced low margin sales activity and contraction in the portfolio unit offset by cost transformation
  • Retail FTTP base grew year-on-year by 36 per cent to 2.7 million of which Consumer 2.6 million and Business 0.1 million; 5G base 11.3 million, up 22 per cent year-on-year
  • BT Group NPS of 25.1, up 0.3pts year-on-year, demonstrating further improving customer experience

Allison Kirkby, Chief Executive, commenting on the results, said: “We’ve made a solid start to the year, with excellent growth in both fibre build and connections, and increased EBITDA. Openreach continues to build at pace and with even more efficiency, passing the milestones of 5 million connections and – just yesterday – 15 million premises built. In Consumer, the widespread availability of FTTP and 5G combined with our new EE propositions has contributed to an improved trend in our customer base, in what remains a very competitive market. In Business, we also saw improved trends, as we continue to modernise our portfolio and our operations towards a simpler business, delivering secure, cloud-based connectivity and communication services for all our customers.”

“Our ongoing cost transformation contributed to EBITDA growth, and more than offset the expected revenue declines in Consumer and Business in the quarter. There is much more to do to simplify BT Group and deliver for our customers. We remain on track to deliver our financial outlook for this year and our cash flow inflection to c. £2 billionn in 2027 and c. £3 billion by the end of the decade,” she concluded.

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