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To true C3PO Ofcom has encouraged parasitic companies to cream off the top of BT's income with unfair rates of access to
BT/Openreach plant, Income/profit which otherwise would have been available to have fibred out Britain over 20 years ago.
"There's an argument that OFCOM have actually stifled true competition by regulating BT to provide wholesale services to others"
And then some. OFCOM and by default the government have held back telecoms development in the UK for 20 years so for them to complain we are behind others is completely their fault. Too busy cosying up to the money for nothing brigade at the expense of a better BT run network.
"Biggest problem is, most people , customers included, think BT is a " Not For Profit" organisation With Ofcom and the government doing all they can to make it so."
The current regulatory environment wont last forever. Openreach will always be the biggest infrastructure provider in the UK. Even though profit margins reduce, due to other providers using PIA, Openreach will always get a cut. Even councils are getting in on the act, and building their own metro networks, using PIA, which incidentally reduces competition from others. No matter what OFCOM does, it doesn't appear to change the competitive climate in the UK, with all the other providers dependant on BT/Openreach infrastructure. BT are spending "£12 Billion" on FTTP, but they get more Bang for the Buck, since they own Openreach. The VM/O2 merged company are talking about spending £10 Billion on rollout, with much of it using Openreach infrastructure, so Openreach will get a cut of that £10 Billion as well as ongoing income from rental charges.
Whatever OFCOM does seems to backfire, with nothing really changing. Even if OFCOM force BT to sell Openreach, current shareholders will gain from that and BT will still own the poles, ducts, wayleaves, and much of the Fibre.
As I've said previously, telecoms providers need scale to profit so many of the current altnets will disappear into the ether, with just a few big players remaining.
Vodafone could have spent a fraction of their German investments fibering out the UK, but they decided not too, and the same could be said of others. There's an argument that OFCOM have actually stifled true competition by regulating BT to provide wholesale services to others
Biggest problem is, most people , customers included, think BT is a " Not For Profit" organisation With Ofcom and the government doing all they can to make it so.
"Net Profit minimum and maximum should be swap places with each other too"
I suspect all eyes are on the Pension review, with no big surprises expected around earnings.
The pension deficit is by far the most interesting part of the upcoming results as far as I'm concerned. Even the dividend suspension, with the intention to restart it at half the previous level, could have an effect through the employers covenant.
Currently spot RPI is up, but the year on year RPI has dropped steadily since 2017.
Spot Gilt and Corporate bond yields are above September levels, which is a positive.
If the stars align, I can see the deficit much lower than expected, and deficit contributions dramatically reduced. If the deficit comes in at £7.5 Billion, or above, it won't be the macro financial background, it will be based on the opinions of the Trustees imo.
Net Profit minimum and maximum should be swap places with each other too. £Amounts are correct.
Minimum = £1.236bn > - > Maximum =£1.651bn
CORRECTED!
=================
(Reported) Revenue:
Consensus Average = £21.370bn
Minimum = £21.252bn > - > Maximum = £21.540bn
----------------
('Adjusted') Pre-Tax Profit:
Consensus Average = £2.295bn
Minimum = £2.110bn > - > Maximum = £2.431bn
----------------
(Net) Profit:
Consensus Average = .£1.521bn
Minimum = £1.651bn > - > Maximum = £1.236bn
----------------
Pension Deficit:
Consensus Average = . . . £9.75bn
Minimum = £7.5bn > - > Maximum = £11.3bn
----------------
(Reported) Net Debt:
Consensus Average = £17.906bn
Minimum = £17.011bn > - > Maximum = £19.315bn
----------------
'
Did you spot the 'deliberate error' :) to see if you were paying attention?
(That's my excuse and I'm sticking to it).
Bleedin' decimal points fell off my keyboard!
THIS -
" ('Adjusted' Pre-Tax) Profit:
Consensus Average = £22.955bn
Minimum = £21.110bn > - > Maximum = £24.310bn "
Should have read as > > >
('Adjusted') Pre-Tax Profit:
Consensus Average = £2.295bn
Minimum = £2.110bn > - > Maximum = £2.431bn
Don't confuse, if on the day, you see media reports focussing on/ bemoaning or comparing "BT down against last year" viewpoints.
Most headings will look worse in comparison to last year. That's a given.
What's more important, is not disappointing against market expectations (shown below).
Below is the market guidance from the analysts "crib sheet" for use on Thursday morning. The target is to either beat all averages, or acceptably come in as "in line" if only just a small amount above/below each heading.
(Have left out cashflows etc., as thought the main key headings are what the general investor is interested in).
Bear in mind BT will report both adjusted and reported under some headings. (For instance some media may report net debt as in the circa £11.5bn's because it accounts for lease liabilities).
Most media will focus on the larger circa £18bn total, so that's what I've shown.
Consensus data culled from here -
https://www.bt.com/bt-plc/assets/documents/investors/financial-reporting-and-news/latest-consensus/btgroup-consensus-30-apr-2021.pdf
( Posting these now as I won't be free until v late Thurs evening; so print this off and keep near your keyboard for Thurs morning).
BT is probably the only stock in the entire FTSE whereby they arm you to the teeth with data for comparison purposes on the day. Most other stocks you have to take on trust what story you read in the media, as to whether market guidance has been met or not.
IMO at least the FTSE100 stocks should do as BT do, in the interests of transparency, instead of keeping investors in the dark ).
So, congats to BT's finance dept - leading the way where other companies should follow too!
=================
(Reported) Revenue:
Consensus Average = £21.370bn
Minimum = £21.252bn > - > Maximum = £21.540bn
----------------
('Adjusted' Pre-Tax) Profit:
Consensus Average = £22.955bn
Minimum = £21.110bn > - > Maximum = £24.310bn
----------------
(Net) Profit:
Consensus Average = .£1.521bn
Minimum = £1.651bn > - > Maximum = £1.236bn
----------------
Pension Deficit:
Consensus Average = . . . £9.75bn
Minimum = £7.5bn > - > Maximum = £11.3bn
----------------
(Reported) Net Debt:
Consensus Average = £17.906bn
Minimum = £17.011bn > - > Maximum = £19.315bn
----------------
'