The telecoms company, which has rolled out its super-fast broadband network to 10 million premises, saw annual profits go up 42 percent in the last financial year
BT's wholesale fibre service is now available to 10 million households and businesses in the UK, the company said on Thursday, as it announced a 42-percent rise in yearly profits.
BT has brought fibre broadband to 10 million premises while seeing its profits rise 42-percent year-on-year.Image credit: BT
The telecoms firm had originally set a target of the end this year
for the milestone, but it has achieved that target early. Ultimately,
BT's
£2.5bn plan is to take fibre past 16 million premises, or
two-thirds of the UK, by 2014.
"Our engineers have worked tirelessly this past year and BT has
made a real commitment to the UK's infrastructure," BT chief executive
Ian Livingston said in a statement. "Rolling out fibre is no easy task
and so to have passed 10 million premises in such a short time is
fantastic. Our rollout is one of the fastest in the world and our
engineers deserve lots of credit."
BT's results provided some figures on the fibre network's
success so far. More than 550,000 people have signed up for the company's BT
Infinity super-fast broadband service, which offers speeds of up
to 80Mbps, and more than 60 smaller ISPs are reselling the service
that underpins that retail product.
BT is expected to receive the
majority of the government's £530m Broadband
Delivery UK (BDUK) fund, which is aimed at extending the reach of
super-fast broadband to rural areas and other parts of the UK that are
not as commercially attractive as the more populous two-thirds.
According to BT's statement, the company has so far only
won the Lancashire bid and been chosen as the preferred BDUK supplier
in Rutland. Until more of the bidding processes close, this funding is
unlikely to show up in BT's results.
Profits up, revenues down
BT's results showed a 42-percent jump in pre-tax profits, for the
year ending 31 March, to £2.4bn. This was achieved largely through
cost-cutting and a drop in restructuring charges, but overall revenues
were down four percent at £19.3bn.
Our rollout is one of the fastest in the world and our engineers deserve lots of credit.
– Ian Livingston, BT
The company said the revenue drop was within its target range, and
blamed it on "the challenging environment in certain markets" and the
long-term
trend of customers using their landlines less.
BT also suggested that Ofcom-mandated
pricing controls on its wholesale and unbundled line rental
products would take between £100m-£200m off its revenues for the next
financial year, and the same the year after that.
Nonetheless, it predicted overall revenue growth in both 2013 and
2014, and said dividends should grow by between 10-15 percent for the
next three years.
"While we will be impacted by economic and regulatory headwinds, we
expect to continue to grow profits over the next two years, with
normalised free cash flow growing to above £2.4bn in 2014," Livingston
said. "We will continue to pursue our prudent financial strategy,
investing in the long-term future of the business, supporting the
pension scheme, paying down debt and enhancing shareholder
returns."
Enterprise revenues were up two percent in the quarter and one
percent in the year, without factoring in the impact of foreign
exchange movements. BT said this was largely down to BT Conferencing,
which saw "an almost 20-percent rise in conferencing minutes in the
quarter".
BT's consumer revenues were down two percent in the most recent
quarter, but that drop was lower than those experienced over the last
two years.
Ovum analyst Mark Giles told ZDNet UK that he was impressed
by BT Retail's successful drive to add more customers.
"BT is doing quite well in terms of innovation," Giles said. "Today
it's all about the bundle of services you can provide the market. The
addition of Sky Sports really helped it, and also the availability of
fibre now is a really strong differentiator at a time when users'
bandwidth demands are going through the roof."
Giles suggested the overall results were in line with a positive
trend in BT's business over the past two years. "They're continuing to
make good progress in pretty much all their lines of business," he
added.
Get the latest technology news and analysis, blogs and reviews
delivered directly to your inbox with ZDNet UK's
newsletters.