TIDMBT.A
RNS Number : 6862U
BT Group PLC
31 July 2020
Trading update
Results for the three months to 30 June 2020
BT Group plc
31 July 2020
BT Group plc (BT.L) today announced its trading update for the
three months to 30 June 2020.
Key strategic developments:
-- BT delivered a strong operating performance and remains
committed to supporting our customers and colleagues. Financial
results impacted by Covid-19
-- Openreach committed to build FTTP to 3.2m premises in rural
areas by 2025/26, subject to enablers including extension of
indexation across the whole country. Continued progress towards 20m
FTTP target
-- Openreach to stop selling copper products to c.1.2m
FTTP-enabled premises in 117 exchange areas from June 2021
-- Further work required to comply with additional restrictions
on the use of Huawei equipment but no anticipated impact on
coverage or rollout of 5G and full fibre; cost expected to be
absorbed within previously reported estimate of GBP500m
-- Enterprise launched major new scheme to support small
businesses in being better positioned for growth following
Covid-19
-- 16 successive quarters of improvement in Group NPS(1)
-- Rob Shuter appointed CEO of Enterprise unit; Gerry McQuade to retire from BT
Operational:
-- Openreach continues FTTP rollout with 3m FTTP premises now
passed; on track to achieve 4.5m by March 2021
-- Consumer fixed ARPC GBP36.4, down 4% year on year due to
continued market competition and residential BT Sport revenue
decline; postpaid mobile ARPC GBP19.6, down 5% due to decline in
roaming and out of bundle revenues, and continued trend towards
SIM-only; RGUs per address 2.41
-- Postpaid mobile and fixed churn both down to 1% in Q1 due to
low market activity during lockdown
Financial:
-- Revenue GBP5,248m, down 7% primarily due to the impact of
Covid-19, including reduced BT Sport revenue and a reduction in
business activity in our enterprise units
-- Adjusted(1) EBITDA GBP1,813m, down 7%, driven by the fall in
revenue and continued investment in customer experience, partly
offset by Covid-19 mitigating actions and savings from our
transformation programmes
-- Reported profit before tax GBP561m, down 13%, due to reduced
EBITDA, higher interest expense, and higher depreciation and
amortisation charges; partly offset by the gain on disposal of our
Spanish operations
-- Negative Q1 normalised free cash flow(1) reflects Covid-19
pressures on EBITDA combined with the usual Q1 pressures on working
capital due to the timing of public sector collections, capex
creditors and payment of management bonus. Normalised free cash
flow(1) declined by GBP372m to an outflow of GBP(49)m driven by
Covid-19 impacts on EBITDA and extended customer payment terms, as
well as some one-off cash flows which benefited the prior year
including the upfront cash payment received from Cellnex
-- Capital expenditure broadly flat at GBP927m, with higher
network investment offset by lower customer and non-network
infrastructure spend
-- Outlook for 2020/21: adjusted(1) revenue down 5% - 6%;
adjusted(1) EBITDA GBP7.2bn - GBP7.5bn; reported capital
expenditure GBP4.0bn - GBP4.3bn; normalised free cash flow(1)
GBP1.2bn - GBP1.5bn
(1) See Glossary on page 5
Philip Jansen, Chief Executive, commenting on the results, said
"Despite Covid-19, BT delivered a strong operating performance
in the first quarter and delivered a relatively resilient set of
financial results. We continue to invest in the long-term future
of the business. We continued to support our customers and colleagues
through the crisis, including offering NHS workers on EE unlimited
mobile data, and discounts for pubs and clubs on BT Sport until
the end of the year. During the quarter Openreach resumed provisioning
and repair activity in customer premises, we re-opened the majority
of our retail stores, and we saw the restart of the Premier League
on BT Sport. Enterprise has today launched the BT Small Business
Support Scheme, which will boost cash flow, connectivity and confidence
among this critical segment of the economy over the coming months.
"Throughout this crisis we remain focussed on delivering against
our strategic goals to deliver long-term value for shareholders.
We reached an important milestone with 3m FTTP premises now passed,
welcomed Ofcom's consultation on our rural FTTP build proposal,
and have now deployed 5G to 100 towns and cities. Together with
continued improvements in customer experience and our modernisation
programme, we are positively positioned for the future.
"Although uncertainties remain, we are now able to provide an outlook
for this financial year. Despite our strong operational performance
in the first three months of the year, it is clear that Covid-19
will continue to impact our business as the full economic consequences
unfold. Beyond this year and based on current expectations, we
expect to return the business to sustainable adjusted EBITDA growth,
driven in part by the recovery from Covid-19."
Three months to 30 June 2020 2019 Change
GBPm GBPm %
Reported measures
Revenue 5,248 5,633 (7)
Profit before tax 561 642 (13)
Profit after tax 448 505 (11)
Capital expenditure 927 931 -
Adjusted measures
Adjusted(1) Revenue 5,250 5,633 (7)
Adjusted(1) EBITDA 1,813 1,958 (7)
Normalised free cash flow(1) (49) 323 (115)
Net debt(1) 18,157 17,805 GBP352m
==================================================== =========== ========== ============
(1) See Glossary on page 5
Overview of the three months to 30 June 2020
CUSTOMER-FACING UNIT UPDATES
Adjusted(1) revenue Adjusted(1) EBITDA
First quarter 2019(2) 2019(2)
to 30 June 2020 Change 2020 Change
GBPm GBPm % GBPm GBPm %
Consumer 2,362 2,550 (7) 501 588 (15)
Enterprise 1,352 1,483 (9) 406 465 (13)
Global 990 1,085 (9) 141 140 1
Openreach 1,286 1,268 1 729 717 2
Other 4 8 (50) 36 48 (25)
Intra-group items (744) (761) 2 - - -
Total 5,250 5,633 (7) 1,813 1,958 (7)
================== ======= ======= ====== ======= ======= ======
Consumer: strong service performance, Covid-19 headwinds to
reduce
Q1 was impacted heavily by Covid-19. With limited sport to
broadcast, revenues from both residential customers and pubs and
clubs declined. Trading was also impacted by the closure of our
retail stores, although increased digital transactions and improved
churn provided some mitigation. EBITDA declined due to lower
revenues and continuing investment in the fairness commitments made
to Ofcom, although it was supported by lower recruitment, reduced
sales related costs, sports rights rebates and savings in
production costs. Covid-19 continues to impact Consumer, mainly
through lower roaming and pay-as-you-go revenue, sport revenue from
pubs & clubs, and more price-conscious customers. Churn levels
improved quarter on quarter, aided by the low market activity.
Service performance during lockdown has been robust, benefiting
from UK-based customer services, 160 stores converted to mini-call
centres and excellent network performance. At the end of Q1 we had
c.80% of our stores open post national lockdown. Complaints to
Ofcom about BT broadband fell by 44% year on year to an all-time
low, remaining below the industry average for three consecutive
quarters. EE won all seven Rootmetrics' awards for UK-wide mobile
network performance in the first half of 2020.
Enterprise: slower business activity but continuing to lower
costs
Revenue was down primarily due to ongoing declines in legacy
products and sharply reduced business activity across Enterprise as
a result of Covid-19. In particular, our SME segment has seen lower
call volumes, and fewer sales and upgrades across both fixed and
mobile. Our Wholesale business has been similarly affected.
Excluding the divestments of Fleet and Tikit in the prior year our
revenue was down 6% and EBITDA was down 12%. The decline in profit
was mainly as a result of Covid-19, partly offset by lower costs
from our transformation programme. Our order intake in the quarter
declined, in part driven by contract delays as a result of the
pandemic. This contributed to the 12-month rolling Wholesale order
intake declining 15% to GBP1.0bn. By contrast, the Retail order
intake was up 14% at GBP3.4bn on a 12-month rolling basis following
a strong fourth quarter. We have been working hard to support our
customers during the pandemic, including flexible payment terms to
support SMEs and recently announced the BT Small Business Support
Scheme. However, we expect to see a further impact from Covid-19 in
future quarters as a result of business insolvency, slower decision
making by our larger customers, and lower usage across our SME and
Wholesale
businesses.
Global: transformation and cost mitigating actions drive EBITDA
growth
Covid-19 negatively impacted revenue in the quarter but did not
materially impact EBITDA as lower non-contracted business and
milestone slippage were offset by higher conferencing volumes and
cost mitigation. Revenue decline was driven by the impact of
Covid-19, divestments, our strategic decisions on low margin
business and legacy portfolio declines partly offset by a GBP6m
positive impact from foreign exchange movements. EBITDA was up 1%
as lower revenue and the impact of divestments were more than
offset by lower operating costs reflecting ongoing transformation,
certain one-offs, Covid-19 mitigation actions including reducing
discretionary spend, optimising resourcing and working with
external suppliers to drive additional cost efficiencies, and a
GBP3m positive impact from foreign exchange movements. At the end
of May we completed the sale of our domestic business in Spain.
Excluding this divestment our revenue was down 7% and EBITDA was up
4%. Order intake in the quarter was GBP0.8bn, up 57% benefiting
from a number of renewals including Bristol-Myers Squibb. On a
rolling 12-month basis it was GBP4.6bn, up 46% year on year.
Looking forward, due to the impact of Covid-19 we are seeing a
reduction in spending and a more cautious approach from our
multinational customers resulting in cancellations and delays to
purchasing cycles that will negatively impact revenue and EBITDA.
In July we agreed the sale of our domestic operations in France
which we expect to complete by the end of 2020.
Openreach: FTTP build on track and service levels maintained
Revenue growth year on year was driven by higher rental bases in
fibre(3) , up 19%, and Ethernet, up 10%, partially offset by
decline in legacy products and price reductions (reflecting the
impact of Openreach's volume related discounts). EBITDA grew 2%
year on year with revenue growth partially offset by higher
operating costs. The increase in operating costs was primarily
driven by investment in people to deliver better service, partially
offset by ongoing efficiency programmes. The quarter has been
impacted by Covid-19 driving lower churn between providers in the
market that reduced provisioning and upgrade activity, but also
reduced ceases across all products. We mitigated some of the
Covid-19 impact by short-term reductions in discretionary spend and
overtime payments, and re-phasing of recruitment. Take up of FTTP
was also impacted by lockdown, but has now accelerated with 10k
orders received in a single week in June, primarily from BT's
Consumer unit. In the quarter, Openreach achieved 41 of Ofcom's 42
quality of service levels on voice and broadband service, including
FTTC, despite service having been heavily impacted by Covid-19,
with MBORC (Matters Beyond Our (Openreach's) Reasonable Control)
invoked for much of the quarter.
(1) See Glossary on page 5. Commentary on revenue and EBITDA is
based on adjusted measures
(2) On 1 April 2020, Supply Chain and Pelipod, which serve
several parts of BT, were transferred from Enterprise to the
central procurement team and as a result will now be reported in
Group 'Other' financial results. The prior year comparative for the
Enterprise and Other CFU results has been restated to reflect this.
Refer to the announcement on 29 June 2020 for further
information
(3) FTTP, FTTC and Gfast (including Single Order migrations)
FINANCIALS FOR THE THREE MONTHS TO 30 JUNE 2020
Income statement
Reported revenue was GBP5,248m, down 7%, due primarily to the
impact of Covid-19, including reduced BT Sport revenue and a
reduction in business activity in our enterprise units,
particularly within SME and Wholesale. The decline in revenue was
also driven by ongoing legacy product declines in our enterprise
businesses but partially offset by higher rental bases of
fibre-enabled products and Ethernet in Openreach.
Adjusted(1) EBITDA of GBP1,813m was down 7% or GBP145m, mainly
driven by the fall in revenue, continued investment in customer
experience and higher operating costs in Openreach; partly offset
by Covid-19 mitigating actions such as short-term reductions in
discretionary spend, and cost savings driven by our transformation
programmes. The movement in Other EBITDA partly reflects a lower
release of bonus accruals than the prior year.
Reported profit before tax was GBP561m, down 13% or GBP81m. This
reduction was driven by the reduced EBITDA and higher interest
expense, and higher depreciation and amortisation charges, partly
offset by a specific item gain in the quarter of GBP11m. This
compares to a specific item loss of GBP107m in the prior year. The
gain includes profit of GBP82m recognised on completion of the
disposal of our Spanish operations in the quarter. There are no
changes to the Covid-19 adjustments recognised in relation to
various balance sheet items in Q4 last year.
Tax
The effective tax rate was 20.1% on reported profit and 21.8% on
adjusted(1) profit, based on our current estimate of the full year
effective tax rate.
Capital expenditure
Capital expenditure was GBP927m (2019/20: GBP931m). Network
investment was GBP526m, up 2%. This reflects continued investment
in FTTP deployment. Other capital expenditure components were down
3% with GBP204m spent on customer-driven investments, GBP170m on
systems and IT, and GBP27m spent on non-network infrastructure.
Normalised free cash flow
Negative Q1 normalised free cash flow(1) reflects Covid-19
pressures on EBITDA combined with the usual Q1 pressures on working
capital due to the timing of public sector collections, capex
creditors and payment of management bonus. Normalised free cash
flow(1) declined by GBP372m to an outflow of GBP(49)m driven by
Covid-19 impacts on EBITDA and extended customer payment terms, as
well as some one-off cash flows which benefited the prior year
including the upfront cash payment received from Cellnex.
Net debt and liquidity
Net debt(1) was GBP18.2bn at 30 June 2020, GBP0.2bn higher than
at 31 March 2020 (GBP18.0bn). Excluding lease liabilities, net
financial debt was GBP11.7bn, GBP0.4bn higher than at 31 March 2020
(GBP11.3bn). The increase was mainly driven by GBP0.4bn of
contributions to the BT Pension Scheme, GBP1.1bn net capital
expenditure, GBP0.2bn payment of lease liabilities and GBP0.3bn net
interest payments; partly offset by net cash inflow from operating
activities (excluding pension contributions) of GBP1.4bn and net
proceeds from disposals of subsidiaries of GBP0.2bn.
Outlook for 2020/21
Although uncertainties remain, we are now able to provide an
outlook for this financial year.
Covid-19 will continue to impact our business as the full
economic consequences unfold and as a result we expect adjusted(1)
revenue to be down between 5% and 6% in 2020/21, and adjusted(1)
EBITDA to outturn between GBP7.2bn and GBP7.5bn.
Beyond this year and based on current expectations, we expect to
return the business to sustainable adjusted EBITDA growth, driven
in part by the recovery from Covid-19. This recovery will be
enhanced by the existing drivers of near-term growth in our
business, with sales of our converged and growth products and
savings from our modernisation programme starting to offset
regulatory headwinds and legacy product declines.
As we accelerate our FTTP build, and continue to invest in 5G
and the modernisation of BT, we expect reported capex for this year
to increase to between GBP4.0bn and GBP4.3bn. We expect this to
result in normalised free cash flow(1) in a range of GBP1.2bn to
GBP1.5bn.
(1) See Glossary on page 5
OTHER DEVELOPMENTS
Regulation
Covid-19 response
Ofcom has responded positively to the work BT has done for the
country during the Covid-19 pandemic. We continue to brief them
regularly on our response to the situation, our plans to "unwind"
some initiatives at the right time, and our learnings from the
initial lockdown period.
Some elements of the contractual MBORC (Matters Beyond Our
(Openreach's) Reasonable Control) declared in Q4 last year remain
in place. This position is under regular review, with Ofcom fully
informed of developments.
Wholesale Fixed Telecoms Market Review (WFTMR) 2021-2026
In May, we submitted our response to Ofcom's WFTMR. The full
response is published on Ofcom's website alongside all
communications providers' (CPs') responses. We still expect Ofcom
to finalise its proposals prior to April 2021.
In July, Ofcom published a follow up consultation on the
approach to investment in Area 3 and Openreach's commitment to
build in Area 3 in the next five years. Ofcom proposes to extend
the fibre "regulatory enablers" into Area 3. We will review the
proposals in detail and provide our response by the deadline in
September. Further follow up consultations are likely.
Broadband universal service obligation (USO)
We have now started to send out letters to potentially eligible
customers in areas where Openreach streetworks have not been
affected by Covid-19. In May, Ofcom confirmed that they will
establish an industry fund for providers that can demonstrate the
costs incurred are an unfair burden. For the fund to be triggered,
BT will need to submit detailed costs demonstrating the net burden
of delivering the USO.
Spectrum auction
Ofcom has indicated that bidding in the upcoming auction of
700MHz and 3.6GHz spectrum in the UK will be in November 2020 at
the earliest, taking into account the impact of the Covid-19
pandemic and other considerations. BT expects to participate in the
auction to support its 5G leadership position.
Consumer fairness
We will formally report to Ofcom on our adherence to its
Fairness for Customers Commitments in the autumn. From Q1 EE mobile
handset customers now benefit from a percentage discount 3 months
after contract end, and prices have now been reduced for
non-fibre-eligible out of contract (OOC) consumers remaining on
copper broadband, and for OOC vulnerable broadband customers who
were previously paying more than the standard OOC price.
In July, the Competition and Markets Authority (CMA) provided
their latest update on the 'loyalty penalty', noting that
vulnerable customers have been disproportionately affected by
Covid-19 and continuing to make the case for additional powers to
tackle harmful pricing practices. The CMA will continue to monitor
Ofcom's work in this area and the impact of CPs' commitments on
prices.
In July, Ofcom published their latest Broadband Pricing Report
stating that they have secured additional pricing commitments from
all the main CPs since the last update, but that there is room for
providers to do more to protect their vulnerable customers from
high out-of-contract prices.
European Electronic Communications Code (EECC)
Ofcom has agreed with the Government to keep the implementation
date of the EECC consistent with the EU date of 21 December 2020.
As CPs will need additional time to make the necessary changes in
their systems and processes to comply with the new rules, Ofcom
will allow providers at least 12 months from the date of their
statement to make the new rights available to customers.
Other matters
Revised policy on Huawei in 5G networks
In July, the Department for Digital, Culture, Media & Sport
(DCMS) announced a revised set of proposals to remove Huawei
equipment from 5G communication networks in the UK by the end of
2027, and consult on the future use of Huawei in FTTP networks.
BT currently estimates that full compliance with these revised
proposals would require additional activity, both in removing and
replacing Huawei equipment from our existing mobile network, and in
excluding Huawei from the 5G network that we continue to build. It
is estimated that these costs can be absorbed within the initial
estimated implementation cost of GBP500m, as reported in our Q3
2019/20 trading update.
We will continue to work with relevant authorities as they
consult on the future procurement strategy for fixed networks.
Openreach to stop selling copper products to c.1.2m FTTP-enabled
premises in 117 exchange areas from June 2021
In May, Openreach announced that, in 117 exchange areas across
the UK, it's planning to stop selling legacy analogue services and
instead focus on providing people with a modern, future-proof full
fibre connection. This is in addition to the Salisbury exchange
area, in which stop sell was announced in December 2019.
Ultrafast service (including full fibre which uses FTTP
technology) along with Gfast technology will be available to more
than 75% of premises in these locations by June 2021, equal to
c.1.2m premises in total. This is a rolling programme so more
locations will be announced over the coming years.
Rob Shuter appointed CEO of Enterprise unit; Gerry McQuade to
retire from BT
BT Group today announced the appointment of Rob Shuter as CEO of
its Enterprise unit and as a member of BT's Executive Committee.
Rob is currently Group President and CEO at MTN Group, Africa's
leading mobile telecommunications company. Prior to joining MTN he
served as CEO of Vodafone's European Cluster. Rob is expected to
join BT by the end of the 2020/21 financial year.
Gerry McQuade the current CEO of BT Enterprise, has announced he
will be retiring from BT. Gerry has spent more than 12 years at EE
and then BT, initially joining BT as the CEO of Wholesale and
Ventures before moving on to lead the integration of that unit with
Business and Public Sector to form the combined Enterprise business
in 2018. Gerry is expected to leave BT around the end of the
2020/21 financial year. See related press release dated 31 July
2020.
Contingent liabilities
There have been no material updates relating to the legal
proceedings and regulatory matters as disclosed in the Annual
Report 2020.
Glossary
Adjusted Before specific items
EBITDA Earnings before interest, tax, depreciation and amortisation
Adjusted EBITDA EBITDA before specific items, share of post tax profits/losses
of associates and joint ventures and net non-interest
related finance expense
Free cash flow Net cash inflow from operating activities after net
capital expenditure
Capital expenditure Additions to property, plant and equipment and intangible
assets in the period
Group NPS Group NPS measures Net Promoter Score in our retail
business and Net Satisfaction in our wholesale business
Normalised free Free cash flow after net interest paid and payment
cash flow of lease liabilities, before pension deficit payments
(including the cash tax benefit of pension deficit
payments) and specific items
Net debt Loans and other borrowings and lease liabilities (both
current and non-current), less current asset investments
and cash and cash equivalents. Currency denominated
balances within net debt are translated into sterling
at swapped rates where hedged. Fair value adjustments
and accrued interest applied to reflect the effective
interest method are removed
Specific items Items that in management's judgement need to be disclosed
separately by virtue of their size, nature or incidence
=================== ==============================================================
Our commentary focuses on the trading results on an adjusted
basis, which is a non-GAAP measure, being before specific items.
The directors believe that presentation of the group's results in
this way is relevant to an understanding of the group's financial
performance as specific items are those that in management's
judgement need to be disclosed by virtue of their size, nature or
incidence. This is consistent with the way that financial
performance is measured by management and reported to the Board and
the Executive Committee and assists in providing a meaningful
analysis of the trading results of the group. In determining
whether an event or transaction is specific, management considers
quantitative as well as qualitative factors such as the frequency
or predictability of occurrence. Reported revenue, reported
operating costs, reported operating profit and reported profit
before tax are the equivalent unadjusted or statutory measures.
Enquiries
Press office:
Tom Engel Tel: 020 7356 5369
Investor relations:
Mark Lidiard Tel: 020 7356 4909
We will hold a conference call for analysts and investors in
London at 9am today and a simultaneous webcast will be available at
www.bt.com/results
We are scheduled to announce the half year results for 2020/21
on 29 October 2020.
Forward-looking statements - caution advised
This results release contains certain forward-looking statements
which are made in reliance on the safe harbour provisions of the US
Private Securities Litigation Reform Act of 1995. These statements
relate to analyses and other information which are based on
forecasts of future results and estimates of amounts not yet
determinable. These statements include, without limitation, those
concerning: the potential impact of Covid-19 on our people,
operations, suppliers and customers; current and future years'
outlook , including without limitation to, including revenue,
adjusted EBITDA, capital expenditure and normalised free cash flow;
strategy; revenue and revenue trends; EBITDA and profitability;
free cash flow; capital expenditure; return on capital employed;
shareholder returns including dividends and share buyback; net
debt; credit ratings; our group-wide transformation and
restructuring programme, cost transformation plans and
restructuring costs; investment in and roll out of our fibre
network and its reach, innovations, increased speeds and speed
availability; our broadband-based service and strategy; investment
in and rollout of 5G; the investment in converged network;
improvements to the customer experience; our investment in TV,
enhancing our TV service and BT Sport; the recovery plan, operating
charge, regular cash contributions and interest expense for our
defined benefit pension schemes; effective tax rate; growth
opportunities in networked IT services, the pay-TV services market,
broadband, artificial intelligence and mobility and future voice;
growth of, and opportunities available in, the communications
industry and BT's positioning to take advantage of those
opportunities; expectations regarding competition, market shares,
prices and growth; expectations regarding the convergence of
technologies; plans for the launch of new products and services;
network performance and quality; the impact of regulatory
initiatives, decisions and outcomes on operations; BT's possible or
assumed future results of operations and/or those of its associates
and joint ventures; investment plans; adequacy of capital;
financing plans and refinancing requirements; demand for and access
to broadband and the promotion of broadband by third-party service
providers; improvements to the control environment; and those
statements preceded by, followed by, or that include the words
'aims', 'believes', 'expects', 'anticipates', 'intends', 'will',
'should', 'plans', 'strategy', 'future', 'likely', 'seeks',
'projects', 'estimates' or similar expressions.
Although BT believes that the expectations reflected in these
forward-looking statements are reasonable, it can give no assurance
that these expectations will prove to have been correct. Because
these statements involve risks and uncertainties, actual results
may differ materially from those expressed or implied by these
forward-looking statements. Factors that could cause differences
between actual results and those implied by the forward-looking
statements include, but are not limited to: the duration and
severity of Covid-19 impacts on our people, operations, suppliers
and customers; failure to respond effectively to intensifying
competition and technology developments; failure to address the
lingering perception of slow pace and connectivity in broadband and
mobile coverage, which continues to be raised at a UK parliamentary
level; undermining of our strategy and investor confidence caused
by an adversarial political environment; challenges presented by
Covid-19 around network resilience, support for staff and
customers, data sharing and cyber security defence; unfavourable
regulatory changes; attacks on our infrastructure and assets by
people inside BT or by external sources like hacktivists,
criminals, terrorists or nation states; a failure in the supplier
selection process or in the ongoing management of a third-party
supplier in our supply chain, including failures arising as a
result of Covid-19; risks relating to our BT transformation plan;
failure to successfully manage our large, complex and high-value
national and multinational customer contracts (including the
Emergency Services Network and the Building Digital UK (BDUK)
programme) and deliver the anticipated benefits; changes to our
customers' needs, budgets or strategies that adversely affect our
ability to meet contractual commitments or realise expected
revenues, profitability or cash generation; customer experiences
that are not brand enhancing nor drive sustainable profitable
revenue growth; pandemics, natural perils, network and system
faults, malicious acts, supply chain failure, software changes or
infrastructure outages that could cause disruptions or otherwise
damage the continuity of end to end customer services including
network connectivity, network performance, IT systems and service
platforms; insufficient engagement from our people; adverse
developments in respect of our defined benefit pension schemes;
risks related to funding and liquidity, interest rates, foreign
exchange, counterparties and tax,; failures in the protection of
the health, safety and wellbeing of our employees or members of the
public or breaches of health and safety law and regulations;
financial controls that may not prevent or detect fraud, financial
misstatement or other financial loss; security breaches relating to
our customers' and employees' data or breaches of data privacy
laws; failure to recognise or promptly report wrongdoing by our
people or those working for us or on our behalf (including a
failure to comply with our internal policies and procedures or the
laws to which we are subject); and the potential impacts of climate
change on our business.
BT undertakes no obligation to update any forward-looking
statements whether written or oral that may be made from time to
time, whether as a result of new information, future events or
otherwise.
About BT
BT Group is the UK's leading telecommunications and network
provider and a leading provider of global communications services
and solutions, serving customers in 180 countries. Its principal
activities in the UK include the provision of fixed voice, mobile,
broadband and TV (including Sport) and a range of products and
services over converged fixed and mobile networks to consumer,
business and public sector customers. For its global customers, BT
provides managed services, security and network and IT
infrastructure services to support their operations all over the
world. BT consists of four customer-facing units: Consumer,
Enterprise, Global and its wholly-owned subsidiary, Openreach,
which provides access network services to over 650 communications
provider customers who sell phone, broadband and Ethernet services
to homes and businesses across the UK.
For the year ended 31 March 2020, BT Group's reported revenue
was GBP22,905m with reported profit before taxation of
GBP2,353m.
British Telecommunications plc is a wholly-owned subsidiary of
BT Group plc and encompasses virtually all businesses and assets of
the BT Group. BT Group plc is listed on the London Stock
Exchange.
For more information, visit www.bt.com/about
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END
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