BT share price down 2% after profit falls in-line with expectations
The British telecoms company saw its profit fall in its annual results leading to its share price sliding on Thursday morning, but its CEO was quick to reassure shareholders on maintaining its dividend.
BT recorded a decline in revenue and profit in its annual results, with its CEO quick to reassure shareholders of its strong outlook for the new financial year by keeping the dividend unchanged and remaining committed to the turnaround plans made by his predecessor.
As a result, the telecoms provider saw its share price edge lower on Thursday morning, falling 2% to 213p, with the stock recovering slightly later on in the session.
BT’s management decided to leave its full-year dividend unchanged at 15.4p a share and announced that it plans to keep the dividend at that same level for the new financial year too based on its earnings outlook in 2019.
‘While we are really well positioned in a very challenging and competitive UK market, we have a lot of work to do to ensure we remain successful and deliver long term sustainable value to our shareholders,’ BT CEO Philip Jansen said.
‘We need to invest to stay ahead in our fixed, mobile and core networks, and we need to invest to overhaul our business to ensure that we are using the latest systems and technology to improve our efficiency and become more agile.’
BT results: key figures
BT reported revenue of £23.43 billion, down 1% compared with last year, with growth in consumer sales offset by regulated price reductions in Openreach and declines in its enterprise businesses, particularly fixed voice.
Meanwhile, the telecoms provider saw its pre-tax profit climbed 2% to £2.66 billion, with its EBITDA falling 2% to £7.4 billion.
Net cash inflow from operating activities fell14% to £4.25 billion, driven by pension deficit payments, increased capital expenditure and lower EBITDA.
‘BT delivered solid results for the year, in line with our guidance, with adjusted profit growth in Consumer and Global Services offset by declines in Enterprise and Openreach,’ Jansen said.
BT accelerates fibre and 5G networks
The telecoms provider stressed the importance of delivering the best converged network and becoming a leader in fixed ultrafast and mobile 5G networks, with the company investing heavily in the UK to achieve this goal.
BT has already announced the first 16 UK cities for 5G investment and on Thursday it increased its target to pass 4 million premises with ultrafast FTTP technology by 2020/21, up from 3 million, with an ambition to pass 15 million premises by the mid-2020s, up from 10 million.
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