BT Ups Fibre Broadband Target to 25 Million Homes by End-2026

By Paul Sandle

BT, Britain’s biggest broadband and mobile provider, set the new target as it reported a 7% fall in revenue and a 6% fall in adjusted earnings for the year to end-March, reflecting the impact of COVID-19.

Chief Executive Philip Jansen said changes in regulation and tax, along with a new agreement on the company’s pension payments, had cleared the way to raise its fibre ambitions.

“After a number of years of tough work, and as we look to build back better from the pandemic, we’re now pivoting to consistent and predictable growth,” he said.

Jansen has cast BT as the national champion that can build the broadband network Britain needs to drive an economic recovery, and he has focused on laying the foundations for the billions of pounds of investment needed.

As well as seeking a partner in fibre, it said last month it was in talks about selling a stake in BT Sport, a move that could relieve the pressure of buying expensive rights.

COVID-19 has also been a setback for the company despite soaring demand for fast broadband.

It said the pandemic was behind the fall in revenue to 21.33 billion pounds ($30 billion), just shy of analyst forecasts, and the hit to adjusted earnings, which also came in slightly below market expectations at 7.42 billion pounds.

It said adjusted revenue would be broadly flat this year, while earnings would be between 7.5 billion and 7.7 billion pounds.

BT said it had struck a new deal for its pension, which at 7.98 billion pounds is one of the biggest in the country.

Some 2 billion pounds of deficit will be met through an asset backed funding arrangement secured against its EE mobile business, while the balance will be met over 10 years, starting with an annual cash contribution of 900 million pounds.

($1 = 0.7118 pounds)

(Reporting by Paul Sandle; Editing by Kate Holton, Michael Holden and Guy Faulconbridge)