Document 13956707

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Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
0ur lines of business
Group performance
Governance
Financial statements
Additional information
19
Purpose and strategy
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20 Chief Executive’s introduction
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Dan Fitz
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BT Group plc
Annual Report 2015
Chief Executive’s introduction
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“It’s been a ground-breaking year for BT.
We’ve announced some major investments
and launched a number of innovative
new services.”
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Gavin Patterson
Chief Executive
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Find out more
Watch my video online at
www.bt.com/annualreport
PC_FRONT.indb 20
5/15/2015 1:47:31 AM
Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
0ur lines of business
Group performance
Governance
Financial statements
Additional information
Our purpose
Our goal
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Our strategy
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Our purpose
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PC_FRONT.indb 21
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22
BT Group plc
Annual Report 2015
Deliver superior customer service
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PC_FRONT.indb 22
5/15/2015 1:47:31 AM
Overview
The Strategic Report
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PC_FRONT.indb 23
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24
BT Group plc
Annual Report 2015
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PC_FRONT.indb 24
5/15/2015 1:47:32 AM
Overview
The Strategic Report
Purpose and strategy
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PC_FRONT.indb 25
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26
BT Group plc
Annual Report 2015
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PC_FRONT.indb 26
5/15/2015 1:47:40 AM
Overview
The Strategic Report
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BT Group plc
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Overview
The Strategic Report
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BT Group plc
Annual Report 2015
How we create value
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31
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5/15/2015 1:47:52 AM
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5/15/2015 1:47:52 AM
Overview
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PC_FRONT.indb 34
5/15/2015 1:47:52 AM
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BT Group plc
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5/15/2015 1:47:53 AM
Overview
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5/15/2015 1:47:53 AM
38
BT Group plc
Annual Report 2015
Our relationship with HM Government
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CO2e Ktonnes
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BT’s worldwide energy usea
Year ended 31 March
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Overview
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Annual Report 2015
Risk description
Impact
Link to strategy
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5/15/2015 1:47:54 AM
Overview
The Strategic Report
Purpose and strategy
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Group performance
Governance
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Additional information
Changes over the last year
Risk mitigation
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5/15/2015 1:47:54 AM
48
BT Group plc
Annual Report 2015
Risk description
Impact
Link to strategy
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PC_FRONT.indb 48
5/15/2015 1:47:54 AM
Overview
The Strategic Report
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Group performance
Governance
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Additional information
Changes over the last year
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PC_FRONT.indb 49
5/15/2015 1:47:54 AM
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Risk case-studies
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Overview
The Strategic Report
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5/15/2015 1:47:55 AM
Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
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Group performance
Governance
Financial statements
Additional information
53
Our lines of business
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54 How we are organised
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PC_FRONT.indb 53
5/15/2015 1:47:55 AM
54
BT Group plc
Annual Report 2015
Our lines of business
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Year ended 31 March 2015
11%
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32,700 or 37%
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41%
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BT Business
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BT Wholesale
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PC_FRONT.indb 54
5/15/2015 1:47:56 AM
The Strategic Report
Purpose and strategy
Overview
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PC_FRONT.indb 55
5/15/2015 1:47:56 AM
56
BT Group plc
Annual Report 2015
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The Strategic Report
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Overview
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BT Group plc
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PC_FRONT.indb 60
5/15/2015 1:47:56 AM
Overview
The Strategic Report
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PC_FRONT.indb 61
5/15/2015 1:47:57 AM
62
BT Group plc
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Overview
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broadband market net
additions
39% of our retail broadband
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1.9% improvement in Right
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5/15/2015 1:47:57 AM
66
BT Group plc
Annual Report 2015
Operating performance
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Annual consumer line losses
Year ended 31 March
000
0
(300)
(496)
(400)
'HOLYHUVXSHULRUFXVWRPHUVHUYLFH
(275)
(314)
(203)
(196)
(200)
(500)
(700)
(800)
2013
2014
2015
Net total line losses
Net active line losses
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BT’s retail broadband market share
At 31 March
%
30
39%
40%
36%
37%
38%
30%
31%
32%
32%
29%
2011
2012
2013
2014
2015
25
20
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PC_FRONT.indb 66
5/15/2015 1:47:57 AM
Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
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Transform our costs
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broadcast rights on page
65
PC_FRONT.indb 67
5/15/2015 1:47:57 AM
68
BT Group plc
Annual Report 2015
BT Wholesale
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Revenue market share of European wholesale telecoms providers
2013: $46.5bn market
46%
Other
16%
BT
14%
Orange
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Products and services
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Broadband
11%
Deutsche Telekom
6%
Telecom Italia
7%
Telefónica
Source: European Wholesale Market Share, 2012/13: The Big Picture, Ovum, March 2015.
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Overview
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IPX carried 19bn
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71
UK
Germany
80%
70%
Spain
EU
50%
France
40%
30%
Italy
20%
10%
0%
2011
2012
2013
Source: European Commission Digital Agenda Scoreboard.
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PC_FRONT.indb 71
5/15/2015 1:47:58 AM
72
BT Group plc
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PC_FRONT.indb 72
5/15/2015 1:47:58 AM
The Strategic Report
Purpose and strategy
Overview
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0ur lines of business
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Over 22m premises passed
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passed
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m
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2012
Premises passed (LHS)
2013
2014
Financial statements
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Year ended 31 March
000
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400
350
300
250
200
150
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Year ended 31 March
2011
Governance
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BT’s Undertakings
on page
38
PC_FRONT.indb 73
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74
BT Group plc
Annual Report 2015
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Openreach’s service performance
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our-responsibilities
PC_FRONT.indb 74
5/15/2015 1:47:59 AM
Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
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76
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Find out more
Our research and development
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34
PC_FRONT.indb 76
Recruitment of graduates and
apprentices on page
31
5/15/2015 1:47:59 AM
Overview
The Strategic Report
Purpose and strategy
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77
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PC_FRONT.indb 77
5/15/2015 1:47:59 AM
78
BT Group plc
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Group Finance Director’s introduction
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Outlook for 2015/16
Underlying revenue excluding transita
Adjusted EBITDAb
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Dividend per share
Share buyback
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PC_FRONT.indb 78
Tony Chanmugam
Group Finance Director
0D\
5/15/2015 1:48:01 AM
Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
0ur lines of business
Group performance
Governance
Financial statements
Additional information
79
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2%
2%
adjusteda
10
500
5
2014
adjusteda
2015
2014
2015
0%
6%
14%
12%
2013
reported
adjusteda
£m
2,900
2,800
2,700
2,600
2,500
2,400
2,300
2,200
2,100
2,000
2014
2015
5,791
6,271
6,018
6,116
5,840
2015
2014
2015
1%
0%
3%
3%
2015
2014
2015
2014
2015
4%
7%
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12%
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^
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reported
normalisedd
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b Before depreciation and amortisation.
c Before purchases of telecommunications licences.
6,000
2,450
4,000
2,000
2,171
2,300
2,782
£m
8,000
2,292
2,326
2,346
2,438
£m
2,480
2013
adjusteda
2014
Proposed full year dividend
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0
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Year ended 31 March
2,120
reported
Capital expenditurec
Year ended 31 March
2,240
4%
5%
2,830
0
reported
2015
1%
0%
15
1,000
2013
2014
25.7
20
26.3
3,172
25
24.8
2,315
2,500
2,645
30
2,827
3,000
2,312
pence
35
2,656
£m
3,500
6,143
11,961
12,171
11,580
reported
2013
2015
5,119
2015
1%
0%
2014
7,028
2014
5,800
5,600
2013
Earnings per share
Year ended 31 March
2,000
6,000
31.5
2015
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2,360
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PC_FRONT.indb 79
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12,312
11,500
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reported
1,500
£m
6,400
11,000
2013
2,000
EBITDA
Year ended 31 March
7,797
17,000
12,196
17,851
17,500
12,000
17,979
18,000
18,287
£m
12,500
18,287
£m
18,500
18,339
Operating costsb
Year ended 31 March
18,103
Revenue
Year ended 31 March
0
2014
2015
2014
2015
5%
7%
28%
16%
2013
2014
2015e
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5/15/2015 1:48:01 AM
80
BT Group plc
Annual Report 2015
Group performance
Our progress against our KPIs
Our progress against our KPIs
Trend in underlying revenue excluding transit
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Our key measure of the
group’s revenue trend,
underlying revenue excluding
transit, was down 0.4%, in
line with the outlook we set at
the start of the year.
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Adjusted earnings per share
Outlook
Adjusted earnings per share
increased 12% to 31.5p.
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information on page 222
2015
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We generated normalised free
FDVKƮRZRI~PZKLFK
was higher than our outlook
for the year of more than
£2.6bn and £380m above the
prior year.
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shareholder circular
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Outlook for 2015/16
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Customer service improvement
Our customer service
improvement measure, ‘Right
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compared to 1.5% last year.
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PC_FRONT.indb 80
5/15/2015 1:48:02 AM
Overview
The Strategic Report
Purpose and strategy
Delivering our strategy
0ur lines of business
%
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2012
2013
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(3.1)
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(1.9)
(1.0)
(3.0)
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(0.5)
(1.5)
(2.0)
(2.5)
(3.0)
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Governance
Financial statements
Additional information
2014
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2,830
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2,900
2,700
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2012
2013
2,450
2,300
1,900
2,307
2,100
2,076
2,500
2,300
2014
2015
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At 31 March
4.7
18.7
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3.0
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10
1.5
%
20
15
5
0
2010
2011
2012
81
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Trend in underlying revenue excluding transit
Year ended 31 March
0.5
Group performance
2013
2014
2015
2015a
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PC_FRONT.indb 81
5/15/2015 1:48:02 AM
BT Group plc
Annual Report 2015
Income statement
EBITDA
$GMXVWHG(%,7'$LQFUHDVHGWR~PƮDWDWWKH
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6,116
6,143
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3,733
3,421
3,300
3,172
2,827
2,656
2,541
2,214
2,059
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11,750
11,580
6,271
11,000
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31
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127
18,339
Programme
rights charges
18,287
307
17,851
Net labour costs
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12,171
Summarised income statement
2014
82
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PC_FRONT.indb 82
5/15/2015 1:48:02 AM
Overview
The Strategic Report
Purpose and strategy
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88
BT Group plc
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Capital expenditure
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The BT Pension Scheme at
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PC_FRONT.indb 89
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90
BT Group plc
Annual Report 2015
Contractual obligations and commitments
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Overview
The Strategic Report
Purpose and strategy
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0ur lines of business
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Developing a culture of tech literacy
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Group performance
Governance
Financial statements
Additional information
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Valuing Digital Inclusion
Year ended 31 March 2015
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60% of learners report
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78% of learners stay
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25% of learners
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environmental savings
of 1.6m tonnes of CO2
So far we have helped 30,000
people take part in courses
and gain cRQƬdence and
competence in using the internet
We measure the social value
of someone going online in
the UK at £1,064 a year
Research by Just Economics for BT
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92
BT Group plc
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Our 2020 ambitions
2013/14 performance
2014/15 performance
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against 2020 target
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Page
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by December 2020
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results are calculated, take a look at www.bt.com/deliveringourpurpose
5/15/2015 1:48:04 AM
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