Upbeat BT counts its cash

12th May 2011 07:56

Telecoms giant BT said its full year results are in line with or ahead of its outlook for the year.The phone and broadband provider saw revenue decline 4% to £20.08bn in the year to 31 March from £20.91bn a year earlier, but earnings before interest, tax, depreciation and amortisation (EBITDA) improved 4% to £5.89bn from £5.64bn.Adjusted profit before tax jumped 20% to £2.08bn from £1.74bn, while the reported version surged 71% to £1.72bn from £1.01bn.Underlying earnings per share rose 21% to 21.0p (reported: +46% to 19.4p), while the full year dividend has been hiked 7% to 7.4p.Free cash flow during the year improved 6% from the year before to £2.22bn, while net debt narrowed by £467m to £8.82bn, despite the group making a billion pounds worth of pension deficit payments."Free cash flow has nearly trebled compared with two years ago," noted chief executive Ian Livingston.Underlying revenue, excluding transit traffic, which has been significantly affected by reductions in mobile termination rates, is forecast to be in the range of -2% to flat in 2012 and to grow by up to 2% in 2013.Management is targeting adjusted EBITDA growth in 2012 and is expecting it to be above £6.0bn in 2013. Adjusted free cash flow in both 2012 and 2013 is expected to be above 2011 levels.On a divisional basis, the Global Services division grew adjusted EBITDA by 30% to £593m on revenue that was 5% lower than the year before at £8.05bn; BT Retail also saw a 5% dip in revenue, to £8.12bn, while adjusted EBITDA was flat at £1.78bn; BT Wholesale's adjusted EBITDA dipped 3% to £1.32bn on revenue that fell 4% to £4.21bn; Openreach's adjusted EBITDA rose 9% to £2.13bn on revenue that eased 1% to £4.93bn."We have consolidated our position as the leading provider of broadband in the UK with our highest quarterly share of DSL broadband net additions for eight years. BT Global Services order intake was up 10% at £7.3bn and it has turned cash flow positive a year ahead of plan. Openreach saw growth in its copper line base in the year, reversing historic trends," Livingston said."We expect to continue to grow our profits and free cash flow whilst investing to return BT to growth. These results show we are making progress, but we are well aware there remains a lot more to do," Livingston added. ---jh