Trading update for the nine months to 31 December 2023
BT Group plc – 1 February 2024
| Allison Kirkby, Chief Executive, commenting on the results, said“BT Group has delivered another quarter of revenue and EBITDA growth, while rapidly building and upgrading customers to our full-fibre broadband and 5G networks, and we continue to be on track to achieve our financial outlook for the year. “We are providing great digital connectivity and services, while laying the foundations for future growth that will benefit our customers, investors and the UK. As I assume the role of Chief Executive, we remain committed to our purpose and our strategic focus, and I am looking forward to leading BT Group into its next phase of development.” |
Continued strong execution of our strategy
• FTTP build rate accelerated to 73k per week delivering a record of 950k premises passed in the quarter. FTTP footprint is now expanded to 13m premises with a further 6m where initial build is underway
• Strong Openreach customer demand for FTTP with net adds of 432k in Q3. Total premises connected now 4.4m with increased take-up of 34%
• Openreach broadband ARPU grew by 10% year-on-year due to price rises and increased volumes of FTTP; Openreach broadband lines losses of 369k year to date, a 2% decline in the broadband base; ongoing weak broadband market conditions mean losses will exceed 400k in FY24
• Consumer broadband ARPU increased 5% year-on-year and Consumer postpaid mobile ARPU increased 8% year-on-year; monthly churn for the quarter remained stable in a competitive market with broadband and postpaid mobile at 1.1% and 1.2% respectively
• Business financial performance continues to be impacted by higher input costs, legacy declines and prior year one-offs, partly offset by cost transformation and growth in Small & Medium Business (SMB) and Security
• Retail FTTP base grew year-on-year by 46% to 2.4m of which Consumer 2.3m and Business 0.1m; 5G base 10.3m, up 30% year-on-year. RootMetrics named EE the UK’s best mobile network for the 21st time running
• BT Group NPS of 25.7, up 3.6pts year-on-year, further improving customer experience
Continued pro forma revenue and EBITDA growth year to date:
• Pro forma adjusted1 revenue £15.8bn, up 3% on Q3 FY23 due to price increases and fibre-enabled product sales in Openreach, increased service revenue1 in Consumer with 2023 annual contractual price rises being aided by higher roaming and increased FTTP connections, and SMB trading momentum and price rises in Business, offset partially by legacy product declines; reported revenue was up 1%
• Pro forma adjusted1 EBITDA £6.1bn, up 3% with revenue flow through and cost control more than offsetting cost inflation and one-off items in the prior year
• Reported profit before tax of £1,498m, up 15%
• Reconfirming all FY24 financial outlook metrics
| Adjusted1 revenue | Adjusted1 EBITDA | |||||
| Nine months to 31 December | 2023 | 2022 Pro forma1 re-presented1 | Change | 2023 | 2022 Pro forma1 re-presented1 | Change |
| £m | £m | % | £m | £m | % | |
| Consumer | 7,463 | 7,193 | 4 | 2,008 | 1,930 | 4 |
| Business2 | 6,127 | 6,143 | – | 1,209 | 1,390 | (13) |
| Openreach | 4,574 | 4,255 | 7 | 2,903 | 2,606 | 11 |
| Other | 12 | 24 | (50) | 2 | 25 | (92) |
| Intra-group items2 | (2,418) | (2,273) | (6) | – | – | – |
| Total | 15,758 | 15,342 | 3 | 6,122 | 5,951 | 3 |
1 See Glossary on page 2
2 Q3 results include a correction of H1 FY24 revenue across Openreach and Business, with no impact on total group revenue. £38m external wholesale revenue was incorrectly recognised by Business in H1 FY24. There is no impact on Openreach segmental results as the revenue was previously classified as internal so was already included in Openreach results; there is a contra entry through intra-group items. H1 FY24 results have not been restated; the correction has been booked within Q3 FY24 to ensure the results for the nine months to 31 December 2023 are correctly stated. The impact on the prior period is immaterial.
| Adjusted1 revenue | Adjusted1 EBITDA | |||||
| Third quarter to 31 December 2023 | 2023 | 2022 re-presented1 | Change | 2023 | 2022 re-presented1 | Change |
| £m | £m | % | £m | £m | % | |
| Consumer | 2,560 | 2,439 | 5 | 661 | 634 | 4 |
| Business2 | 2,027 | 2,102 | (4) | 403 | 487 | (17) |
| Openreach | 1,521 | 1,419 | 7 | 967 | 871 | 11 |
| Other | 4 | 10 | (60) | (3) | 15 | (120) |
| Intra-group items2 | (768) | (758) | (1) | – | – | – |
| Total | 5,344 | 5,212 | 3 | 2,028 | 2,007 | 1 |
1 See Glossary below
2 See footnote 2 on previous table. Excluding the £38m correction booked in Q3 FY24, Business revenue would be £2,065m and intra-group items would be £806m.