BT BT Group PLC

   By Adria Calatayud 
 

BT Group PLC (BT.A.LN) reported earnings for the fourth quarter and full fiscal 2018 on Thursday. Here's what you need to know:

PROFIT: The British telecommunications and TV provider made a pretax profit of 872 million pounds ($1.18 billion) in the quarter ended March 31 compared with GBP440 million in the year-earlier period. This was below an analyst consensus of GBP887 million provided by BT. Full-year adjusted earnings before interest, taxes, depreciation, and amortization--the company's preferred profit measure--fell 2% on year to GBP7.51 billion, at the lower ended of BT's guided range.

REVENUE: BT generated fourth-quarter revenue of GBP5.97 billion, down 2.5% from GBP6.12 billion in the same quarter of fiscal 2017 and below a company-provided analyst consensus of GBP6.06 billion. For the full fiscal 2018, underlying revenue fell short of the company's guidance of a flat performance.

WHAT WE WATCHED:

RESTRUCTURING: The company said it will cut 13,000 jobs--which will mainly involve back office and middle-management roles--over the next three years and will hire around 6,000 new employees to support network deployment and customer service. This adds to last year's plans to shed 4,000 jobs. According to FactSet, BT employs 106,400 people globally. As part of its restructuring, the company will also exit its central London headquarter to focus on 30 strategic sites. BT expects to deliver cost-savings of GBP1.5 billion.

DIVIDEND: BT left full-year dividends unchanged at 15.4 pence a share and said it will freeze them for the next two fiscal years. In fiscal 2017, BT raised dividends by 10%. The company attributed its dividend guidance to a more downbeat outlook for the period. BT forecasts underlying revenue falling 2% and adjusted Ebitda between GBP7.3 billion and GBP7.4 billion in fiscal 2019, which is below analyst consensus provided by the company. Analysts had said BT's dividend comments would be a key to investors' perception of the results. At 1056 GMT, BT shares traded 9% lower and led the FTSE 100 fallers.

PENSION PLAN REVIEW: BT said it agreed with the trustee of its pension plan on the triennial funding valuation and recovery plan. The company said it will fund the pension plan deficit over a 13-year period, and will contribute GBP4.5 billion by June 30, 2020--when the next triennial review is due--and make annual payments of around GBP900 million for the following decade through 2030.

Write to Adria Calatayud at adria.calatayudvaello@dowjones.com

(END) Dow Jones Newswires

May 10, 2018 07:25 ET (11:25 GMT)

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