Three months into the role and BT’s new Chief Executive, Philip Jansen, used the group’s 2018/19 FY results presentation to give analysts a glimpse of how he intends to make BT ‘bolder, smarter, faster and future-proof’.
The results: BT reported earnings before interest, tax, depreciation and amortisation for the year to March 31 of £7.39bn, down 2 per cent but within the range of its previous guidance. Revenues fell 1 per cent to £23.4bn because of declines in phone calls and regulatory price cuts in Openreach.
No significant departure from the status quo: What was most striking was that there appeared to be no significant departure from the strategy put in place by Jansen’s predecessor, Gavin Patterson. While Philip said he had made some changes, he was broadly happy with the direction of travel and didn’t envisage any further restructuring or headcount reduction. Notably he highlighted his ‘dismay’ at some of the processes that had to be navigated to get things done, suggesting process and system simplification is going to be a major activity.
Fibre and regulation: The biggest announcement was an increased target to pass 4 million premises with FTTP by 2020/21, up from 3 million, and an ambition to pass 15 million premises by the mid-2020s, up from 10 million, if the conditions are right, especially the regulatory and policy enablers. More generally, regulation was a central theme with annual spectrum licence fees, mobile spend caps, international calls in the EU and auto compensation in fixed identified as the strongest regulatory headwinds. While the impact of regulation should reduce in the longer-term, it’s still expected to cost the group more than £1bn over the next 3 years.
