BT released its financial report for the first half of 2024, displaying mixed results amid an economic landscape fraught with challenges. Most notably, the UK giant’s revenue declined by 3%, affected by issues beyond the UK and a fiercely competitive retail market. Meanwhile, profit before tax dropped by 10% to £1 billion, influenced by increased costs and finance expenses.
A brighter aspect of BT’s performance includes the rapid deployment of fibre, which now extends to over 16 million households. Openreach has connected 2.1 million residences with fibre-to-the-home in recent months, aiming to reach 4.2 million by FY25. Also noteworthy is the addition of 446,000 new active connections, boosting the total to 5.5 million. In the mobile sector, BT’s 5G network expansion continues to lead, covering a significant 80% of the UK population.
However, the newly announced UK budget presents fresh challenges. With increased National Insurance contributions mandated by the government, BT anticipates an additional £100 million in annual expenses. In response, CEO Allison Kirkby mentioned measures to absorb these costs, such as passing them onto mobile and broadband users and intensifying cost-cutting through automation and AI. “We are confirming our EBITDA, capex, and cash flow guidance for FY25, albeit on lower revenue guidance. We remain firmly on track to meet our long-term cost savings and cash flow targets, and today we announce an interim dividend of 2.40pps,” stated Kirkby.
Meanwhile, workforce reductions continue to play a role in financial planning, saving BT £433 million in the first half of the year alone. Having cut 2,000 positions, the company is on a path to achieving significant cost-savings targets.
Overall, despite financial constraints, BT remains focused on strategic priorities, especially its full fibre and 5G expansion. Moreover, it is exploring opportunities for BT Global that could involve restructuring or sale to optimize international operations.
