Trading statement for the first quarter to 30 June 2018
BT Group plc (BT.L) today announced its results for the first quarter to 30 June 2018.
BT Group plc (BT.L) today announced its trading statement for the first quarter to 30 June 2018.
Key developments for the quarter
- Successfully launched new converged products including BT Plus and 4G Assure
- EE to launch the UK’s first live 5G trial network in East London in October
- Future Telecoms Infrastructure Review conclusion and Ofcom’s approach to future regulation provide positive progress towards enabling fair returns for infrastructure investment
- Openreach announced new wholesale pricing discounts to accelerate superfast and ultrafast uptake
- Continued improvement in customer experience metrics; Group NPS1 up 1.9 points and Right First Time2 up 3.1%
- Initiatives to transform our operating model on track; new Enterprise senior leadership team announced
- Over 1.7m total ultrafast premises passed; currently building FTTP to c.10,000 premises per week
- Monthly fixed ARPU up 1% to £37.9, with increased mix of SIM only reducing postpaid mobile ARPU by 1% to £21.7; churn remains low at 1.2%
- Mobile customers up 4% in Business and Public Sector. External broadband lines down 6% in Wholesale and Ventures and 3% in Business and Public Sector
- Reported revenue of £5,715m. Underlying3 revenue down 2%4 as regulated price reductions in Openreach and declines in our enterprise businesses offset growth in our consumer business
- Adjusted3 EBITDA up 1%4 to £1,800m mainly driven by stronger handset margins in our consumer business and restructuring related cost savings
- Reported profit before tax of £704m. Adjusted3 profit before tax up 3%4 at £816m
- Normalised free cash flow3 of £507m down 9% mainly driven by increased cash capital expenditure partly offset by timing of working capital movements
- Reported capital expenditure broadly flat at £839m
Gavin Patterson, Chief Executive, commenting on the trading update, said
"We’ve made a good start to the year. We are making positive progress against our strategy. Our customer experience metrics continue to improve and we have seen the successful launch of new converged products including BT Plus, our first Consumer converged offering and 4G Assure, for business customers. Initiatives to transform our operating model have seen a gross reduction in c.900 roles across the Group and improved cost performance.
"EE continues to maintain its network leadership and will switch on the UK’s first live 5G network trial in October. Openreach continues its FTTP network deployment and is currently building to c.10,000 premises per week. New Openreach wholesale pricing will incentivise communications providers to encourage more of their customers onto better services and ultimately move the vast majority of Britain’s homes and businesses onto superfast and ultrafast platforms. We welcome the initial outcome of DCMS’ Future Telecoms Infrastructure Review and Ofcom’s approach to future regulation and look forward to further engagement with all our key stakeholders to ensure greater clarity, certainty and support as we look to realise our broader investment ambitions.
"Our outlook for the year remains unchanged."
1 Group NPS measures Net Promoter Score in our retail business and Net Satisfaction in our wholesale business
2 Measured against Group-wide ‘Right First Time’ (RFT) index
3 See Glossary
4 Measured against unaudited IFRS 15 pro forma comparative period in the prior year
n/m = IFRS 15 to IAS 18 comparison not meaningful
Customer facing unit results for the first quarter to 30 June 2018
1 See Glossary
2 Unaudited IFRS 15 pro forma used for comparative period in the prior year
n/m = not meaningful
SUMMARY AND OUTLOOK
There is no change to our financial outlook for 2018/19 from that published on 25 June which reflected the adoption of the IFRS 15 accounting standard.
1 See glossary
2 Excluding BDUK clawback