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TIDMBT.A
RNS Number : 5997A
BT Group PLC
03 February 2011
3 February 2011
BT GROUP PLC
RESULTS FOR THE THIRD QUARTER AND NINE MONTHS TO 31 DECEMBER 2010
BT Group plc (BT.L) today announces its results for the third quarter and nine months to 31 December 2010.
Key points for the third quarter:
-- Revenue of GBP5,038m, down 3%
-- EBITDA1 of GBP1,484m, up 7%
-- Profit before tax1 of GBP531m, up 30% (after specific items, up 111%)
-- Earnings per share1 of 5.4p, up 32% (after specific items, up 96%)
-- Free cash flow2 of GBP515m, up 69%
-- Net debt of GBP8.7bn, down GBP1.4bn
-- DSL broadband net additions of 188,000, 53% market share
-- BT Global Services expected to generate operating cash flow of around GBP100m in 2010/11 and
around GBP200m in 2011/12
Ian Livingston, Chief Executive, commenting on the results, said:
"Profits and cash flow in the quarter were ahead of last year. BT Retail had a good quarter with growth in business revenues and our highest share of DSL broadband net additions for eight years. Openreach benefited from a stronger broadband market and growth in its copper line base. BT Global Services is now expected to be cash flow positive this year, a year earlier than targeted.
"These results show that we are making progress on a number of fronts. There is always more to do but our performance underpins our outlook for this year and the period to 2012/13."
1 Before specific items
2 Before pension deficit payment of GBP525m (Q3 2009/10: GBP525m)
Unless otherwise stated, the changes in results are year on year against the third quarter or nine months to 31 December 2009.
RESULTS FOR THE THIRD QUARTER AND NINE MONTHS TO 31 DECEMBER 2010
Group results
Third quarter to 31 December Nine months to 31 December
------------- ------------------------------ -------------------------------
2010 2009 Change 2010 2009 Change
GBPm GBPm % GBPm GBPm %
------------- -------- --------- --------- --------- --------- ---------
Revenue
- adjusted 5,038 5,198 (3) 15,021 15,555 (3)
- reported 5,038 5,198 (3) 15,021 15,503 (3)
------------- -------- --------- --------- --------- --------- ---------
EBITDA
- adjusted 1,484 1,386 7 4,335 4,127 5
- reported 1,418 1,227 16 4,147 3,821 9
------------- --------- ---------
Operating
profit
- adjusted 733 632 16 2,118 1,876 13
- reported 628 473 33 1,891 1,570 20
------------- -------- --------- --------- --------- --------- ---------
Profit
before tax
- adjusted 531 408 30 1,473 1,230 20
- reported 441 209 111 1,222 756 62
------------- -------- --------- --------- --------- --------- ---------
Earnings per
share
- adjusted 5.4p 4.1p 32 14.9p 12.2p 22
- reported 4.5p 2.3p 96 13.3p 10.6p 25
------------- -------- --------- --------- --------- --------- ---------
Capital
expenditure 680 554 23 1,811 1,671 8
------------- -------- --------- --------- --------- --------- ---------
Free cash
flow
- before
specific
items 569 526 8 1,604 1,017 58
- after
specific
items 515 305 69 1,465 888 65
------------- -------- --------- --------- --------- --------- ---------
Net debt 8,674 10,112 (14)
------------- -------- --------- --------- --------- --------- ---------
Line of business results
Operating cash
Adjusted revenue Adjusted EBITDA flow
------------ ------------------------ -------------------- --------------------
Third
quarter to 2010 2009 Change 2010 2009 Change 2010 2009 Change
31 December GBPm GBPm % GBPm GBPm % GBPm GBPm %
------------ ------- ------- ------ ----- ----- ------ ----- ----- ------
BT Global
Services 1,974 2,118 (7) 141 123 15 115 (27) n/m
BT Retail 1,967 2,020 (3) 452 436 4 324 371 (13)
BT Wholesale 1,070 1,075 - 330 337 (2) 141 224 (37)
Openreach 1,240 1,241 - 550 488 13 316 321 (2)
Other and
intra-group
items (1,213) (1,256) 3 11 2 n/m (381) (584) 35
Total 5,038 5,198 (3) 1,484 1,386 7 515 305 69
------------ ------- ------- ------ ----- ----- ------ ----- ----- ------
1 Before specific items. Specific items are defined below
2 Before pension deficit payment of GBP525m (Q3 2009/10: GBP525m)
3 Adjusted for the impact of customer account moves and the impact of changes in the internal trading model. The effect of the changes is primarily to reduce internal revenue in both BT Wholesale and Openreach by around GBP62m per quarter in 2010/11. There is no impact from these changes on total group revenue. In the line of business commentaries for BT Wholesale and Openreach, revenue has been measured against an adjusted basis taking account of the changes in the internal trading model to enable a like for like comparison
4 Restated for the impact of customer account moves
n/m = not meaningful
Notes:
Specific items - unless otherwise stated, any reference to earnings before interest, tax, depreciation and amortisation (EBITDA), operating profit, operating costs, profit before tax and earnings per share (EPS) are measured before specific items. The commentary focuses on the trading results before specific items. This is consistent with the way that financial performance is measured by management and is reported to the Board and the Operating Committee and assists in providing a meaningful analysis of the trading results of the group. The directors believe that presentation of the group's results in this way is relevant to the 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. 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. Specific items may not be comparable to similarly titled measures used by other companies.
Reported EBITDA, reported operating profit, reported profit before tax and reported EPS are the equivalent unadjusted or statutory measures.
Enquiries
Press office:
Ross Cook Tel: 020 7356 5369
Investor relations:
Catherine Nash Tel: 020 7356 4909
A conference call for analysts and investors will be held at 10:30am today and a simultaneous webcast will be available at www.bt.com/results.
The fourth quarter and full year results to 31 March 2011 are expected to be announced on 12 May 2011.
About BT
BT is one of the world's leading providers of communications solutions and services operating in over 170 countries. Its principal activities include the provision of networked IT services globally; local, national and international telecommunications services to our customers for use at home, at work and on the move; broadband and internet products and services and converged fixed/mobile products and services. BT consists principally of four lines of business: BT Global Services, BT Retail, BT Wholesale and Openreach.
British Telecommunications plc (BT) 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 stock exchanges in London and New York.
For more information, visit www.btplc.com.
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The company news service from the London Stock Exchange
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