- BT’s pre-tax profits soared 29% in the half-year to September 30
- It also revealed that turnover grew by 3% to £10.4bn thanks to higher prices.
- A year ago, BT announced its goal to save £500m in additional costs by 2025.
BT Group maintained its full-year financial guidance after major cost-cutting efforts pushed profits slightly higher in the first half.
The telecoms giant expects to report rising adjusted revenue and earnings before unpleasantness on a pro forma basis, as well as normalized free cash flow towards the top end of its £1bn to £1.2bn range .
For the six months ending September 30, turnover grew 3 per cent to £10.4 billion thanks to price increases and sales of fibre-compatible products.
Broader target: A year ago, BT announced it was aiming to save £500m in extra costs by 2025 in response to worsening inflation, particularly due to energy prices.
Reported pre-tax profits soared 29 per cent to £1.1bn as cost savings helped offset inflationary pressures and one-off items from the previous year.
A year ago, BT announced it was aiming to save £500m in additional costs by 2025 in response to rising inflation.
It told shareholders on Thursday that the cost-reduction strategy was on track, having achieved annualized gross savings of £2.5bn since April 2020.
The London-based company, which owns internet service provider EE, is also carrying out cost-cutting plans to ensure it has enough cash flow to fund its network investments.
It delivered ultrafast full fiber broadband to a record number of 860,000 premises over the last quarter, meaning its FTTP network now covers 12 million buildings across the UK.
Outgoing chief executive Philip Jansen said BT is “rapidly building and connecting customers to our next-generation networks, we are simplifying our products and services, and we are now seeing predictable and consistent revenue and EBITDA growth.”
Jansen will be replaced early next year by Allison Kirkby, director of Swedish telecoms operator Telia Company and non-executive director of BT since 2019.
As BT boss, Kirkby will be tasked with achieving the group’s £3bn cost savings target while expanding its 5G and full fiber network.
By the end of 2026, BT’s Openreach division intends to invest £15 billion in rolling out full fiber broadband to 25 million UK homes and businesses, with around a third of those installations in rural towns across the UK. Hard access.
It is also planning up to 55,000 staff cuts by 2030, equivalent to more than 40 percent of its global workforce, with around a fifth to be replaced by artificial intelligence.
Russ Mould, chief investment officer at AJ Bell, said: ‘Incoming chief executive Alison Kirby will take a look at today’s first-half results from BT and find things to please and annoy her.
‘The company has made significant cost progress and is controlling spending, which should result in healthier cash generation.
“This is clearly encouraging, but it’s also the sort of thing Kirby herself could have targeted, as normally a new boss will look for easy wins by making efficiencies to get his tenure off to a good start.”
BT Group Shares rose 6.3 per cent to 118.05 pence on Thursday morning, making them the second biggest riser on the FTSE 100 index, although they have still fallen around 7.5 per cent in the last 12 months.