BT Group plc Fact Sheet
February 2016
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Who we are
BT is one of the world’s leading communications services companies, serving the needs of customers in the UK and in more
than 170 countries worldwide. Our main activities are the provision of fixed-line services, broadband, mobile and TV products
and services as well as networked IT services. Following the acquisition of EE on 29 January 2016, BT consists principally of six
lines of business: BT Global Services, BT Business & Public Sector, BT Consumer, EE, BT Wholesale and Openreach.
Revenue: £17.9bn
1
2
Equity market cap: £48bn
LSE: BT.A
Shares outstanding: 9,968m
NYSE: BT
2
Employees:c.100,000
Gavin Patterson, Chief Executive
Tony Chanmugam, Group Finance Director
Appointed September 2013. Previously CEO of BT Retail.
Prior to joining BT in 2004 he was MD Consumer at
Telewest (now Virgin Media), and prior to that, European
Marketing Director at P&G. Currently a non-executive
Director of BA and a Trustee of The British Museum.
Appointed December 2008. Prior roles include CFO, BT
Retail; and MD, BT Enterprises. Prior to that, he was CFO and
then jointly CFO & COO for BT Global Solutions, a business
serving multinational organisations in >100 countries. Over
six years the business grew from £500m to c.£3bn revenue.
Our purpose, goal, strategy and culture
To use the power of communications to make a better world
Our purpose
A growing BT: to deliver sustainable profitable revenue growth
Our goal
Our strategy
Broaden and deepen our customer relationships
Deliver superior
customer service
Transform
our costs
TV and
content
Fibre
Our culture
Mobility and
future voice
Invest for
growth
UK business
markets
Leading global
companies
A healthy organisation
Our values
• Our purpose is to use the power of communications to make a better world. By bringing together
the best networks and technology with the expertise of our people, we make connections and
create new possibilities.
• To achieve our goal of sustainable, profitable revenue growth we have to broaden and deepen our
customer relationships. We’ll do this by putting customers first, bringing them front and centre of
everything we do. We believe that we can grow our customer base. We can also sell more
products from our current portfolio to our existing customers across all markets.
• We are a premium brand and our customers expect superior service. Only if we offer great service
will we be able to broaden and deepen our customer relationships. We’ll build on the progress
we’ve already made by adopting a customer first mindset and gearing everything we do towards
making things better for our customers.
• We’ve made good progress in reducing our costs but our work isn’t finished. In fact, it never will
be. Technology is changing rapidly, our competitors are upping their game and our customers are
demanding more for less. Being efficient in everything we do, especially reducing failure, improves
customer service and gives us the oxygen to invest in the business.
• BT’s size, cash flow and financial stability mean we can invest at scale, and if we execute well,
create great value for our customers and shareholders. We are investing in five areas to help us
grow over the long term in a sustainable way: Fibre; TV & content; Mobility & future voice;
UK business markets; and Leading global companies.
Delivering our purpose: to use the power of communications to make a better world
BT has five ambitions to deliver by 2020:
We are here for
our customers
We help each other
achieve more
We are honest
and respectful
We all make
change happen
We are proud to
make a difference
9/10
10m
5m
£1bn
3:1
More than 9 out of 10
people in the UK will have
access to fibre-based
products & services
Help 10m people
overcome social
disadvantage through the
benefits our products &
services can bring
Help 5m children to
receive better teaching in
computer skills
Help generate >£1bn for
good causes, whilst
inspiring 2/3 of our
people to volunteer
Help customers reduce
their carbon emissions by
at least three times the
end-to-end carbon
impact of our business
Building a culture of
Tech Literacy
Supporting charities
Delivering
& communities
environmental benefits
Creating a Connected Society
Financial Facts
Key financial measures & Outlook4 for 2015/16
Financial objectives
Drive sustainable, profitable revenue growth
Revenue5
2009/10
2010/11
2011/12
2012/13
2013/14
2014/15
£21,011m
£20,174m
£19,397m
£18,339m
£18,287m
£17,851m
-0.4%
Underlying revenue
ex transit6
Grow EBITDA
Grow free cash flow
Invest for
growth
Reduce
net debt
Support
pension fund
Net debt
Full year dividend
Net debt as at 31 March Long term credit
ratings2
Progressive divi policy
p
£m
10,000
We are targeting a
BBB+/Baa1 credit rating
over the medium term
8,000
14
+14%
12
+15%
+14%
10
+12%
-2.9%
-3.0%
-1.9%
-3.1%
+0.5%
EBITDA5
£5,622m
£5,858m
£6,034m
£6,143m
£6,116m
£6,271m Modest growth
Capital expenditure7
£2,533m
£2,590m
£2,594m
£2,438m
£2,346m
£2,326m
Normalised free
cash flow8
£2,032m
£2,076m
£2,307m
£2,300m
£2,450m
£2,830m Around £2.8bn
Earnings per share5
17.1p
20.7p
23.4p
26.3p
28.2p
Dividend per share
6.9p
7.4p
8.3p
9.5p
10.9p
12.4p
+10%-15%
-
-
-
£302m
£302m
£320m
c.£300m
£9,283m
£8,816m
£9,082m
£7,797m
£7,028m
£5,119m
Share buyback
Net debt
1%-2% growth
31.5p
Pension – 2014 triennial funding valuation
 Deficit of £7.0bn as at 30 June 2014, driven by continuing low interest rate environment
 £2.0bn to be paid into Scheme over next 3 years
– tax efficient £1.5bn payment during March & April 2015
– then further £250m in both FY 2015/16 and FY2016/17
 16 year recovery plan, reflects strength & sustainability of future cash flow generation
 If 2017 valuation lower than remaining recovery plan, this is reflected in new recovery plan
10.9p
New Recovery Plan*
£2bn
£m
Agreed payments
1,500**
1500
Agreed payments, to be reviewed
at 2017 valuation
1000
2
500
0
0
2015
2014
2013
| BBB+
4
2012
2015
2014
2013
2012
Fitch
| BBB
9.5p
0
S&P
8.3p
2,000
6
5,119
7,028
7,797
9,082
Moody’s | Baa2
8
12.4p
6,000
4,000
Progressive
dividends
2015/16
2012
2013
* Years are to 31 March
** By end of April 2015
2014
2015
250
250
2016
2017
688
699
711
2018
2019
2020
724
2021
670
670
670
2022
2023
2024
495
495
495
495
495
2025
2026
2027
2028
2029
289
2030
BT Group financial overview1 (pre EE)
Structure of BT
BT Global
Services
BT
Business
BT
Consumer
BT
Wholesale
EE
BT Group EBITDA5
BT Group external revenue5
Openreach
BT Global
Services
BT Business
11%
Technology, Service & Operations (internal)
12%
In the UK we are a leading communications services provider, selling products and
services to consumers, small and medium sized enterprises and the public sector. We
also sell wholesale products and services to communications providers in the UK and
around the world. Globally, we supply managed networked IT services to multinational
corporations, domestic businesses and national and local government organisations.
BT Global
Services
BT Business
17%
38%
41%
BT Consumer
BT Consumer
17%
BT Wholesale
BT Wholesale
24%
15%
16%
9%
Openreach
Openreach
BT lines of business
BT Global Services
BT Business
Revenue
- u/l ex transit
EBITDA
Operating cash flow
Order intake
2011/12
2012/13
2013/14
2014/15
£7,392m
-5.8%
£950m
£314m
£6,580m
£7,269m
-1.0%
£1,041m
£499m
£7,280m
£6,779m
-4.0%
£1,047m
£349m
£6,458m
£948m
£493m
£6,947m
5%
5%
43%
Continental Europe
20%
US & Canada
31%
Revenue
- u/l ex transit
EBITDA
Operating cash flow
Order intake
18%
High-growth regions
2011/12
2012/13
2013/14
2014/15
£3,220m
-2.0%
£940m
£816m
£2,202m
£3,213m
-0.8%
£1,002m
£799m
£2,098m
£3,145m
-1.4%
£1,041m
£874m
£2,073m
10
Market share
£939m
£775m
£1,835m
Future plans
 Growing share of wallet with existing customers
Financial institutions
 Developing new IP-based voice and data products
 Cross-selling from leading position in fixed line
Transit
Other global carrier
BT Consumer
8
6
4
2
0
Source: IDC and BT
6%
1%
30%
Fixed-voice and data
BT
Mobility
Rest of market
Addressable IT
services market
EE
John Petter
Serves around 10m residential customers in UK
•
Largest consumer fixed-voice & broadband provider in UK.
Growing base of TV, BT Sport, and mobile customers.
2011/12
£3,925m
Revenue
- u/l ex transit
EBITDA
Operating cash flow
Total consumer lines (‘000)
Retail broadband (‘000)
- of which fibre (‘000)
TV customers (‘000)
CEO
2012/13
£3,846m
-2.0%
£968m
£655m
10,207
£883m
£592m
10,919
6,280
515
707
2013/14
£4,019m
4.5%
£833m
£472m
9,908
6,704
1,236
810
60%
40%
20%
0%
 BT Sport: 3.3m direct customers & 1.9m wholesale3
Source: Ofcom
42%
CEO
Acquired 29 January 2016
No.1 in mobile for the UK
33% share of the mobile market
7,713
3,010
1,142
UK’s most advanced 4G network – 95% coverage & >14m 4G customers
>31m connections of which >24m direct mobile customers
Market share
 Market is increasingly triple-play
 Growing demand for faster broadband
Marc Allera
Serves >31m customers in the UK
•
Largest provider of mobile services in UK
Growing base of broadband and TV customers
2014/15
£4,285m
+6.6%
£1,031m
£813m
9,633
7,281
2,105
1,002
Market share
 Competitive market with several strong players
5%
31%
Allows BT to accelerate mobility strategy
Calls and lines Broadband
TV
BT Wholesale
Openreach
Nigel Stagg
Provides network services and solutions to other
communications providers (CPs) in UK
•
More than 1,400 CP customers
Revenue
- u/l ex transit
EBITDA
Operating cash flow
Order intake
CEO
2011/12
2012/13
2013/14
2014/15
£2,943m
£2,608m
-2.6%
£620m
£348m
£2,031m
£2,422m
-3.0%
£614m
£372m
£1,910m
£2,157
-7.1%
£561m
£278m
£1,908m
£667m
£259m
£748m
Key trends in our wholesale markets
Revenue
- u/l ex transit
EBITDA
Operating cash flow
Physical lines (‘000)
Broadband (‘000)
- of which fibre (‘000)
m
Premises passed
 Continuing local loop unbundling (LLU) by main competitors
 Increased competition
 Growing demand for bandwidth across our broadband, Ethernet and media networks
2011/12
£5,187m
25
Premises passed with fibre (LHS)
Take up % (RHS)
20%
m
5
20
15%
4
15
10%
10
5
IR Director
1
0%
0
Mark Smith
Evelyne Bull
Jon Cox
Joanna Gluzman
Head Investor
Relations Officer
Senior Investor
Relations Officer
Strategy Specialist
Investor Relations
Director,
SRI Engagement
For the 2014/15 financial year ended 31 March 2015
As at 29 January 2016
3
As at 31 March 2015
4
On a BT stand alone basis, as given at Q3 2015/16 results on 1 February January 2016
5
Before specific items
6
Excludes specific items, foreign exchange movements and the effect of acquisitions and disposals
7
Before purchases of telecommunications licences. Accrued capex, rather than cash capex.
8
Before specific items, purchases of telecommunications licences, pension deficit payments and the cash tax benefit of pension deficit payments
2014/15
£5,011m
-1.0%
£2,600m
£1,502m
25,302
19,306
4,193
Openreach fibre customers
BT
External
2
5%
BT Investor Relations
Carl
Murdock-Smith
2013/14
£5,061m
-1.1%
£2,601m
£1,492m
25,087
18,455
2,677
3
Q4 10/11 Q4 11/12 Q4 12/13 Q4 13/14 Q4 14/15
Group Investor
Relations Director
CEO
2012/13
£5,115m
-1.4%
£2,642m
£1,475m
25,004
17,629
1,411
£2,618m
£1,514m
24,950
16,795
538
0
Damien Maltarp
Clive Selley
Provides wholesale copper and fibre connections between BT’s
exchanges and UK homes & businesses. 540 CP customers.
•
Widely regulated by Ofcom, operates at arm’s length
 Portfolio evolution towards IP-based services
1
2
CEO
£3,294m
Corporate
Public sector
52%
Graham
Sutherland
Serves around 900,000 SME customers in UK and Ireland
•
Leading position in fixed-voice, networking and broadband
services. Also provides IT services & mobility.
2014/15 revenue by customer type
UK
13%
CEO
£8,042m
2014/15 revenue by region
13%
Luis Alvarez
Market size (£bn)
A global leader in managed networked IT services
•
Serves >6,500 large corporate & public sector customers
in >170 countries, incl 98% of FTSE100, 82% of Fortune 500
While BT believes the information contained in this document to be reliable, BT
does not warrant the accuracy, completeness or validity of the information, figures
or calculations that follow and shall not be liable in any way for loss or damage
arising out of the use of the information, or any errors or omissions in its content.
Q4 10/11 Q4 11/12 Q4 12/13 Q4 13/14 Q4 14/15
+44 (0)20
7356
4909
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7356
4909
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email:
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