BT: Departing Jansen’s investment in fibre and Openreach pays off with revenue jump
Telecoms giant BT has today reported a notch up in revenue after continued successful roll out of their Openreach full fibre broadband.
The British mobile network operator’s revenue grew to nearly £5.2m in the first quarter this year, up four per cent from the same period in 2022.
This was mainly driven by revenue from its Openreach division – up eight per cent – which maintains and runs BT’s broadband network.
The firm said Openreach is now 44 per cent of the way through its full fibre build target of 25m homes by the end of 2026.
Demand for Openreach increased by 34 per cent in the first quarter year-on-year with over 383k added customers, taking the total number of ‘fibre to the premises’ connections to 3.5m.
However, the Openreach broadband base was down 126k due to “competitor losses combined with a weak broadband market and communications providers ceasing copper lines”.
Shares dipped 1.3 per cent when the market opened this morning.
“Consumer is seeing solid pro forma growth driven by pricing and mix, as customers choose higher performance connections; and Business grew its order book, driving revenue growth for the combined unit.
We continue to drive transformation across the group, and while there remains much to do it’s clear that our strategy is working and BT Group is set up for success.”
Matthew Dorset, equity research analyst at Quilter Cheviot, said BT’s recent 14.4 per cent price increases for customers helped the company’s revenue and profits to beat estimates.
Encouraging growth across all three of BT’s business units suggests “the price increases have landed okay with customers,” he said.
“While there is still pressure there from challengers and competitors, BT is a strong brand and will be able to better navigate a high interest rate environment than smaller competitors. With a new CEO incoming soon, BT is well placed for the future,” Dorset added.
Earlier this month BT confirmed boss Jansen will depart the company “at an appropriate moment” within the next year.
Analysts said his replacement has their work cutout as the firm continues to embark on an ambitious nation-wide rollout of full fibre broadband.
Defending his tenure to some critics, Jansen pointed to London investors’ “short term” outlook as the reason behind the telecoms giant’s prolonged share price slump.
BT has initiated a formal succession process to find Jansen’s replacement.
The company announced plans in May to reduce its workforce by up to 42 per cent over the next seven years, aiming to achieve cost reduction and transform into a more streamlined business.