Monday, 21 May 2018 00:16

BT Group on path to sustainable long-term growth, says GlobalData


UK telecommunications services provider BT Group’s restructuring and cost-cutting is a means to drive sustainable long-term growth and to reverse the downward trend in earnings, according to data and analytics company GlobalData.

It says the moves by BT follow its announcement last year of a reduction of 4000 roles in similar areas, of which 2800 have been removed to date, resulting in a cost saving of £180 million over the year.

Stephanie Char, associate analyst, Global Telecom at GlobalData, says in the recent earnings release from BT Group, the big announcement came in the form of 13,000 job cuts over the next three years, primarily within back-office and middle management roles, coming at a cost of £800 million.

“The  blow is somewhat softened, with Openreach stating plans to hire 3500 new trainee engineers over the coming 12 months to support its Fibre First program,” Char said.

{loadposition  peter}BT Group’s revenue for the 2017/18 financial year was down 1% year-on-year with adjusted EBITDA for the same period falling 2%, and chief executive Gavin Patterson expects that the Group will only see EBITDA return to growth from 2021 onwards.

GlobalData notes that BT Group and Openreach — the infrastructure division of BT — have shown increasing commitment towards the Fibre First strategy, with an annual CAPEX allocation of around £3.7 billion towards improving their FTTP network and mobile infrastructure.

And, accordfing to GlobalData, this is expected to drive the operator to hit its target of three million premises passed by FttP by end-2020, and 10 million by the mid-2020s.

“GlobalData expects BT to continue to lead the broadband market, though its market share of broadband internet accounts is expected to continue to fall from 35.3% in 2017 to 32% in 2022. Declines in market share are expected for all major operators as newer market entrants like Plusnet and John Lewis, and mobile operators like Vodafone and Three, make inroads into the broadband market,’ Char said.

On the TV side, Char said BT’s customer base declined just slightly, by 10,000 users over the past 12 months.

Char notes, however, that performance from BT Sport remained strong, with viewing figures across all platforms up 19% year-on-year over the last three months.

“This was very much down to BT Sport’s strong portfolio of live sports and exclusive broadcasts, including rights to continue showing Premier League matches for a further three years from the 2019/20 season, in a deal worth £295 million per season.”


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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).



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