BT hikes payout as profits grow on cost cut plan
BT yesterday announced a full year dividend hike of 12 per cent and said its shareholder payout will grow by an annual 10 to 15 per cent over the next three years.
The country’s leading telecoms company posted a full year adjusted pre-tax profit of £2.42bn, an increase of 16 per cent, as operating profit jumped six per cent to £3.09bn boosted by cost cuts.
But revenues dropped by four per cent to £19.3bn, dragged down by tough economic conditions and regulatory limits to the amount BT can charge other operators to carry their traffic.
BT Openreach was the only division to increase revenues in the year to 31 March, growing four per cent to £5.1bn.
Chief executive Ian Livingston told reporters the results were “a real mixed bag”.
Livingston announced BT’s £2.5bn rollout of superfast fibre broadband to 10m homes and firms has been completed many months ahead of schedule, adding “but we know there is more to do”.
BT added 589,000 retail broadband customers in the year, reaching a total of 6.3m. Livingston claimed the UK is now one of the most connected cities in the world.
He added that the British telco giant won £2bn of new orders in the fourth quarter, comprising a greater number of smaller contracts as “people just aren’t making huge decisions at the moment”.
Although net debt was up slightly to £9.1bn, due to a £2bn upfront payment to reduce BT’s pension fund deficit, Livingston seemed confident the debt would be paid down next year.
BT shares fell by 2.7 per cent to 212p.