Transcript available to

Full year results special - May 2011
The Big Picture Online is a quarterly presentation with
highlights of BT’s financial performance and examples of the
actions BT is taking to become a better business with a
better future
This quarter we share the latest news from BT’s full year financial
results to March 2011
Results summary
Revenue1 – down 4% to £20bn
Profit before tax1 – up 20% to £2bn
Operating cost savings3 of over £1bn
Free cash flow2 – up 6% to £2.2bn
Full year dividend of 7.4p (up 7%)
– before specific items
– before specific items and pension deficit payments
3 – operating costs before specific items and
depreciation and amortisation
1
2
0
“We have delivered
profits and free cash
flow ahead of
expectations for the
year, while making
significant investment
in the business for the
future.”
Ian Livingston
BT Group CEO
Key headlines
12 May 2011
Global Services order intake up 10% at £7.3bn; cash flow positive a year early
Growth in Openreach copper lines as customers recognise advantages of fixed line broadband
Cash used to invest in the business; reduce net debt; pay progressive dividends; and support the
pension fund. BT put £1.3bn into BT Pension Scheme (BTPS) during fiscal ending March 2011
Expect to grow profits and free cash flow while investing to return BT to growth in 2013
Customer service delivery
We experienced challenges this year especially in the UK
Service improvements:
- Global Services customer faults
c.10%
- Wholesale broadband faults
- Consumer complaints
c.20%
- Business complaints
c.15%
c.60%
Driving broadband-based consumer services
A better future
Being the ‘Brand for Business’ for UK SMEs
A better
future
BT Global Services – a global leader
The wholesaler of choice
The best network provider
A responsible and sustainable business leader
A better
business
Honesty
Agility
 Weekly net
adds c.5,000
 144,000
customers
 BBC iPlayer
 HD
 Recommendation
engine

Broadband
New
services
5.7m customers
 Award winning
broadband
 OnLive gaming
Differentiated
service
 Home Hub 3 with
Smart Wireless
5
© British Telecommunications plc
WiFi
 >2.8m hotspots
 Lowers churn
 Usage more
than doubled
Broadband net adds
 64% share of broadband net adds1
in Q4
BT
Other DSL & LLU
BT share of net adds
– highest retail net adds for 8 years
– highest ever including cable
‘000
– c.90% of new broadband provides
in Q4 were part of a bundle
2009
 Active customer loss in Q4 lowest
for 4 years
 Consumer ARPU up 5% to £326
Consumer ARPU
£
2005
1
DSL and LLU
6
© British Telecommunications plc
2011
2010
2006
2007
2008
2009
2010
2011
 BT Business line loss in Q4 at lowest
level for more than 3 years
2011 BT Business revenue c.£2.4bn
4%
16%
 New business broadband
propositions launched
– FY business broadband net adds
up c.30% YoY
 Focus on IT services and mobility
– IT services revenue up 17% FY
– Mobility revenue up 14% FY
– opportunity to increase market share
7
© British Telecommunications plc
Fixed voice & data
IT services
Mobility
80%
IT services and mobility revenue trend
IT services
Mobility
 Order intake
– £7.3bn in year, up 10%
 Contract wins in Q4
– Ecopetrol
– BASF
 AsiaPac
– investment on track
– growing pipeline
Banking
&
Financial
Markets
Commerce
(Manufacturing,
logistics &
pharma)
Consumer
Packaged
Goods
 Strong growth in LatAm
 New structure
– focus on key global sectors
– industry specific solutions
– global account management
and delivery model
8
© British Telecommunications plc
UK
EMEA & Latin America
United States & Canada
Asia Pacific
Gov’t &
Health
 40% of FY external revenue under
long-term contract
 Executing on existing MNS
contracts
External revenue ex transit
MNS & IP
 Portfolio evolving from traditional
to IP
– MNS & IP revenue up 14% FY
£m
– IP Exchange minutes up more than
75% FY
– fixed Ethernet connections trebled
9
© British Telecommunications plc
Other
QoQ change in total copper lines
 Copper line base grew for first time
since 2006
– up 11,000 FY versus down 326,000
last year
 ADSL2+ available to 80% of UK
premises by December 2011
‘000
 Ethernet - 1,000 fibre Ethernet
nodes, largest network in the UK
 Continued investment overseas
– Ethernet, MPLS & city fibre
10
© British Telecommunications plc
2010
2011
 Fibre roll out progressing at a good pace
–
–
–
–
–
passing around 80,000 new premises per week
5m homes to be passed in next few weeks
c.150,000 end users currently
c.45 CPs selling or trialling services
Cornwall and NI progressing well
 Network capabilities
– expect to roughly double our FTTC speeds to up to 80Mbps in 2012
– potential for >100Mbps FTTC
– FTTP roll out commencing, 1 Gbps trial underway
Fibre roll out
ADSL enabled
for c.99% of all
premises
11
© British Telecommunications plc
>4m premises
passed
currently
5m premises
passed
shortly
10m premises
passed
by 2012
2/3 premises
passed by
end of
2015
For more information about BT’s strategy go to:
Team BT 2012 Challenge intranet site
(http://2012challenge.intra.bt.com/our-strategy/index.htm)
Investor centre of the BTplc internet site (BT Group annual
report published 27 May)
(http://www.btplc.com/sharesandperformance/index.cfm)