BT: Temporary problems, long-term promise

Report Overview

BT: Temporary problems, long-term promise

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BT: Temporary problems, long-term promise
BT’s divisions had contrasting fortunes in Q1 2019/20, with Consumer revenue growth sharply turning negative but Openreach external revenue growth accelerating to 10%, leaving the Group level unchanged at -1% and EBITDA on course to meet guidance
Consumer was hit by several regulatory and pricing factors mainly affecting mobile, and the short-term outlook remains tough, with a number of legacy pricing issues across fixed and mobile still to be resolved
Openreach is reaping the benefit of previous price declines annualizing out, allowing it to take full advantage of higher speed demand, and due to its full fibre roll-out this dynamic could persevere for years

Contents

Revenue growth steady at the Group level

Broadband steady but subdued, mixed outlook

Mobile hit heavily by regulation and RPI price rise

Openreach starts its acceleration

Guidance maintained, and divestments grow

List of charts/tables

Figure 1. Consumer and Openreach external revenue growth Figure 2. Revenue growth Figure 3. BT Group revenue and EBITDA growth Figure 4. Broadband net adds (000) Figure 5. BT Consumer operating performance Figure 6. Broadband entry level dual-play pricing, new customers (£/month) Figure 7. Broadband high speed pricing, new customers (£/month) Figure 8. BT’s mobile operating performance Figure 9. Contract net additions by operator (000s) Figure 10. Reported mobile service revenue growth by operator Figure 11. Openreach FTTC ARPU (£) Figure 12. Fibre take-up (FTTx) Figure 13. Openreach ultrafast coverage net adds (000s of premises) Figure 14. FTTP build plans and coverage Figure 15. Openreach FTTP list prices (£ per month) Figure 16. BT Group guidance Figure 17. Incremental headwinds to EBITDA