 BT’s top table turnover continues
BT’s CEO, Allison Kirkby, continues her revamp of the UK telco’s leadership team
She has spent the past year replacing the top table old guard with new recruits
Telco sector veteran and ‘IT dragon slayer’ Jon James has been drafted in as the new CEO of BT Business
He replaces Bas Burger, who is given the task of offloading BT’s international operations
The news comes as BT reports uninspiring fiscal third-quarter results
BT Group CEO Allison Kirkby has further revamped her top executive team line-up with the appointment of Jon James, the former CEO of Denmark’s Nuuday, as the new CEO of BT Business, the UK telco’s enterprise services division that has been struggling for several years.
James will take on the poisoned chalice from 3 March. He will replace Bas Burger, who has been grappling with the tough turnaround assignment at BT Business since the start of 2023, shortly after the telco merged its Enterprise and Global units to form a single unit in order to cut costs – BT merges units to form BT Business and save £100m.
Burger had been the CEO of BT Global up to that point and, in a way, he will be going back to those roots starting in March, though this isn’t a glamorous assignment: Kirkby’s strategy is to focus on the UK, believing BT’s international operations are a distraction and a drag on margins, so Burger’s job will be to “devote all of his time to the optimisation of BT’s international operations and explore options for the unit,” the operator noted. Those options include trying to find a partner that could take a stake in a spun-out operation that would be underpinned by the next-generation Global Fabric infrastructure built over the past few years – see What now for BT’s Global Fabric?
James, meanwhile, will be tasked with reversing the fortunes of BT Business, which is shrinking by the quarter. Hopes are high that he could repeat his performance at Nuuday, the services company spun out of former Danish national operator TDC, where he is credited with revamping the company during his tenure as CEO, which began in mid-2021 and ended about a month ago. Critical to his turnaround strategy at Nuuday was an IT transformation that enabled the company to become a more agile, efficient and customer-centric company – see How Jon James slayed the Nuuday IT dragon.
Prior to his time at Nuuday, James held various senior positions at Tele2 Netherlands (2017-19), Swedish cable operator Com Hem (2014-2016) and the UK’s Virgin Media (2007-2013).
“Jon’s considerable experience from the UK and European telecoms markets, together with his track record in leading businesses through transformation, will be hugely valuable as we fully focus BT Business on the UK,” noted Kirkby.
James added: “I am excited and honoured to join BT as CEO of BT Business, the UK’s leader in B2B telecoms. BT Business has an unbeatable combination of deep customer relationships and world-class technology expertise, and I am looking forward to working with Allison, Bas and the BT Business team as we build an even stronger asset for our customers, our shareholders and for the UK.”
James is the latest new name in the frame at BT’s top table, which has seen multiple changes since Kirkby took over as CEO a year ago. She added Tom Meakin, a former partner at consultancy McKinsey, as chief strategy and change officer and in September ousted chief digital and innovation officer Harmeen Mehta. Then in November 2024, Kirkby announced Claire Gillies as the new CEO of BT’s Consumer division, replacing Marc Allera.
The numbers game
BT’s fiscal third-quarter trading update, released today, indicates the task ahead for Kirkby, Gillies and (from March) James.
Total revenues for the three months to the end of December came to £5.18bn, down 3% year on year, with the decline mainly due to “continued challenging non-UK trading conditions” and lower smartphone sales for BT’s EE consumer division.
BT Business, which is still the telco’s second-biggest division after the Consumer unit, reported a 2% decline in revenues, to £1.98bn (including sales to other parts of BT’s operations). For the first three quarters of the current financial year (April to December 2024), BT Business reported a 5% decline in revenues to £5.85bn, compared with the same period a year earlier, showing that the division’s sales are in steady decline.
The Consumer division’s revenues were also down in the fiscal third quarter as well as during the first three quarters of the fiscal year, by 2% in both instances, though this is due to the impact of lower device sales: BT noted that Consumer returned to service revenues growth in the third quarter.
Despite the declining revenues, BT Group’s margins are improving slightly, thanks to greater cost controls (a key focus of Kirkby’s strategy): Fiscal third-quarter adjusted EBITDA came in at £2.1bn, up 4% year on year.
BT noted that its cost transformation plan “remains on track as we continue to create a simpler BT Group, delivering efficiencies across all units; energy usage in our networks was down 3% in the year to date, and total labour resource down 3% year on year to 117k; we achieved an 11% reduction in year-to-date Openreach repair volumes,” noted the operator.
Openreach, BT’s quasi-autonomous wholesale fixed access network division, remains the division that continues to grow, albeit only slightly, with fiscal third-quarter revenues up by 1% to £1.53bn.
Openreach’s focus is further building out and monetising its fibre access network. Having passed an additional 1 million premises with fibre in the fiscal third quarter, Openreach’s fibre-to-the-premises infrastructure now reaches 17 million UK premises and is on course to reach 25 million by December 2026.
And there is strong wholesale demand for Openreach’s FTTP network: In the fiscal third quarter, net additions were 472,000 to take the total number of commercial fibre connections to 6 million with a take-up rate of 35%. However, Openreach is losing out to fibre access network rivals in areas where it hasn’t yet rolled out its own FTTP infrastructure: As a result, Openreach’s total broadband lines declined by 208,000.
Overall, the numbers weren’t to the liking of investors, as BT’s share price dipped by 2.4% to 142.5 pence on the London Stock Exchange in Thursday morning trading.
- Ray Le Maistre, Editorial Director, TelecomTV |
Trading update for the quarter and nine months to 31 December 2024
BT Group plc - 30 January 2025
Allison Kirkby, Chief Executive, commenting on the results, said
"Our ongoing modernisation continues at pace, delivering a further step-up in fibre build and take-up, customer satisfaction and EBITDA. Benefits from our cost transformation more than offset lower revenue outside the UK and weak handset sales.
"Openreach again performed strongly with the highest ever full fibre build, passing more than 1 million premises for the fourth consecutive quarter, and connecting a new record of nearly half a million customers. Consumer returned to service revenue growth and continued to expand its full fibre and 5G customer bases. In Business, our core UK channels were stable. Cost transformation remains firmly on track, with excellent progress on both energy costs and productivity in the quarter.
"We continue to make progress towards becoming fully focused on the UK, with the sale of our data centre business in Ireland. I am also very pleased to welcome Jon James to BT's Executive Committee as the new CEO of a UK-centric BT Business, effective early March. This appointment enables Bas Burger to dedicate his time to the optimisation of our international business segment, which is progressing to plan.
"BT's continued delivery means we remain on track to deliver our financial outlook for this year and our cash flow inflection to c.£2.0bn in 2027 and c£3.0bn by the end of the decade." |
BT Belfast reveals plans to make 90 staff members redundant this year
Staff have told Belfast Live it was an "out of the blue" announcement made on Tuesday with redundancies in place
One of Northern Ireland's biggest employers has announced nearly 100 staff members will be made redundant this year. There are 90 positions at BT's headquarters at Riverside Tower in Belfast impacted by changes at the company.
Staff have told Belfast Live it was an "out of the blue" announcement made on Tuesday, with redundancies in place from May 31. One staff member added: "It's a huge shock to the people impacted but also the economy."
A BT Group spokesperson said: “Today, we shared proposals with a small number of colleagues in Belfast to transfer some of the work they do to other BT office locations. We are discussions with anyone affected by our proposals and, if we go ahead, we have shared other opportunities in the wider Belfast office. There is no impact to customers.”
Read more: Belfast city centre bar withdraws application for Monday 'student nights'
In 2023, the company completed the multi-million-pound refurbishment of its flagship Riverside Tower office in Belfast, and stated it "continues to invest in the region." A spokesperson added: "Belfast remains a strategic location for BT Group and is home to around 2,000 colleagues from across the company, including EE, BT Business and Openreach."
Sinn Féin MP John Finucane has said BT must do all it can to protect as many jobs as possible at its Belfast headquarters. The North Belfast MP said: “News that 90 positions in BT’s Belfast headquarters could be at risk of redundancy is concerning, and I want to firstly extend my solidarity to these workers as they learn about this news.
“This will come as a devastating blow to these workers and their families, some with decades-long experience at the company.
“I will be writing to the company calling on its management to do everything it can to retain as many jobs as possible, and support those workers made redundant with retraining or re-skilling. BT must now ensure they work alongside trade unions to keep employees informed of any developments as this process develops.”
Across BT Group, the company employs more than 3,400 people in Northern Ireland, with its activities here contributing more than £630million to the local economy.
In January 2024, BT Group announced plans to recruit nearly 40 apprentices and graduates in Belfast for its September intake. The company recruited apprentices in software engineering, customer service, applied research, data analytics and cyber-security. The roles included 28 graduate jobs and 11 apprenticeships.
Last October, 300 staff members at a BT call centre in Enniskillen were made redundant, with many of the employees involved taking voluntary redundancy. |
BT struggles for growth
BT is facing intensifying competition and regulatory pressures and at the first-half stage the company trimmed its estimates for full-year sales.
AJ Bell analysts say that “at least this means expectations are low as Allison Kirkby becomes the latest BT boss to try and negotiate the many cross-currents that face the company”.
This is probably no bad thing, say Bell’s researchers in a note, as BT is finding it hard to generate much by way of growth overall.
BT has had to backtrack on its prior forecast of growth in sales for the full year to March 2025. Management now expects a drop of 1% to 2%.
Watch out for updates on the £3 billion cost-cutting programme, the rapidly shrinking pension deficit and progress at the merged BT Sport-Discovery Eurosport business.
The company last week reported that half of Scottish homes and businesses can now get connected to ultrafast, reliable broadband following Openreach investment in the new digital network.
It has spent more than £435 million on full fibre links for Scotland so far, with 1.45 million properties now able to upgrade and take-up at 38% ahead of the UK average.
Katie Milligan, Openreach chief commercial officer and chair of its Scotland board, said: “Fast, reliable connectivity is a game-changer in every part of Scotland. It fuels economic growth and can support the redistribution of economic activity to less populated areas.
“This is quite simply one of the most significant infrastructure upgrades Scotland will see this century. We’re paving the way to future job creation, remote work, digital learning, and innovative healthcare access.” |
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