BT Group reports strong profit surge, shares up 8%

BT Group (LSE: BT.A) announced robust financial performance today, revealing a solide 29% surge in pretax profit to £1.08 billion in the six months ended September 30, up from £831 million a year earlier. The telecommunications giant’s revenue also saw a modest increase, rising from £10.37 billion to £10.41 billion during the same period.

BT attributed this impressive growth to effective cost control and steady revenue flow, outpacing cost inflation and one-off items from the previous year. The positive financial report drove BT’s shares up by 8.6% to 120.65 pence each at 11:20 GMT on the FTSE 100 index, making it the top performer of the day.

Despite these gains, BT opted to maintain its interim dividend at 2.31 pence per share. The company confirmed its financial outlook for the full year, expressing confidence in its normalised free cash flow, which is expected to be at the higher end of the guidance range.

CEO Philip Jansen, who will step down at the end of January 2024, expressed his satisfaction with the results, stating, “These results show that BT Group is delivering and on target: we’re rapidly building and connecting customers to our next generation networks, we’re simplifying our products and services, and we’re now seeing predictable and consistent revenue and Ebitda growth.”

Jansen expressed optimism about BT Group’s future, particularly under the leadership of incoming CEO Allison Kirkby. Kirkby, currently the CEO of Telia Co AB, a prominent digital communications and telecommunications provider in the Nordic and Baltic regions, will assume her role at BT Group early in the new year.

Kirkby’s appointment in July signalled BT’s strategic vision, aiming to leverage her expertise to drive the company’s growth further. Speaking about Kirkby, Jansen stated, “She knows the sector, she knows the company, and she’s the right person to lead BT Group from this position of operational strength.”

Kirkby, set to take the helm in January 2024, will be supported by Jansen during the transition period until the end of March, aligning with BT’s fiscal year 2024.

Moreover, BT remains committed to its cost-saving initiatives, targeting annualised savings of £3 billion by financial 2025. The company’s ongoing programme has already achieved £2.5 billion in annualised savings, bolstering its financial resilience.

BT’s strong performance not only reinforces its position in the market but also paves the way for Kirkby to steer the company to new heights, promising a promising future for the telecommunications giant and its stakeholders.