BT share price slides as telco’s revenue inches lower

on Jan 31, 2019
Updated: Oct 21, 2019

Shares in BT Group (LON:BT.A) have fallen into the red in London this morning, as the telco updated investors on its nine-month performance, posting a small drop in revenue. The results mark the end of chief executive Gavin Patterson’s tenure at the former telecoms monopoly, with Philip Jansen due to take over tomorrow.

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As of 09:45 GMT, BT’s share price had given up 3.87 percent to 224.95p. The shares are underperforming the broader UK market, with the benchmark FTSE 100 index having climbed into positive territory and currently standing 0.66 percent higher at 6,987.21 points.

BT updates on performance

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BT announced in a statement this morning that the group’s reported revenue had inched down one percent to £17.6 billion in the first nine months of its financial year.  Underlying revenue came in 0.9 percent lower, with regulated price reductions in Openreach and declines in the telco’s enterprise businesses offsetting growth in its consumer business.

Adjusted EBITDA was broadly flat at £5.6 billion, while reported profit before tax surged 20 percent to £2.1 billion.

"Our overall outlook for the full year remains unchanged, with EBITDA around the top end of our guidance for FY 2018/19,” BT’s outgoing chief executive Gavin Patterson said in the statement, adding that he was “handing over the business with good momentum behind its ongoing transformation programme”.

Analysts weigh in on results

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City A.M. quoted Lee Wild, head of equity strategy at Interactive Investor, as adding: In the short term, expect BT to have its hands full dealing with increased regulation, fierce competition, rising costs and a drop off in contribution from legacy products. Add the threat of a no-deal Brexit to that list.” The analyst, however, reckons that for now, “a pick-up in trading and heavy cost-cutting is offsetting headwinds, and restructuring put in place by Patterson continues to feed through”.

As of 10:12 GMT, Thursday, 31 January, BT Group plc share price is 224.95p.

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