BT share price surges as telco unveils ultrafast broadband plans

Move comes ahead of group’s results

BT share price surges as telco unveils ultrafast broadband plans

Shares in BT Group (LON:BT.A) have advanced in London in today’s session as the company’s network division Openreach unveiled plans to introduce ‘ultrafast’ Internet connections to three million premises by the end of the decade. The news comes as the former telecoms monopoly prepares to update investors on its quarterly performance tomorrow.

As of 13:19 GMT, BT’s share price had added 0.84 percent to 257.60p, outperforming the broader UK market, with the benchmark FTSE 100 index having slipped into the red and currently standing 0.26 percent lower at 7,513.93 points. The group’s shares have lost more than 15 percent of their value over the past year, as compared with a near six-percent rise in the Footsie.

Ultrafast broadband plans

BT’s Openreach division announced in a statement today that it was accelerating its Fibre to the Premises (FTTP) build programme, extending its current build target by 50 percent to reach three million premises by the end of 2020 through its new ‘Fibre First’ programme.

“Through the Fibre First programme, Openreach is getting on with the job of building an Ultrafast Britain,” the unit’s chief executive Clive Selley commented in the statement. Openreach’s plan comes amid regulatory pressure on the former telecoms monopoly to boost internet speeds.

“We think that BT’s announcement will have little impact on the attitude of Ofcom,” ahead of the decision on the wholesale rates, Jerry Dellis, an analyst at Jefferies, told Bloomberg in an emailed note, estimating an incremental capital expenditure hit for BT from the fibre plan at about £350 million over the next three years.

BT results preview

BT is scheduled to update investors on its third-quarter performance tomorrow and MarketWatch reports that according to a consensus forecast provided by the company, the telco is expected to post third-quarter sales of £6.06 billion, down from £6.13 billion in the prior-year period. BT’s third-quarter pretax profit meanwhile is expected to come in at £661 million, up from £526 million.

As of 13:58 GMT, Thursday, 01 February, BT Group plc share price is 256.25p.

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