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LONDON (Alliance News) - BT Group PLC Thursday raised its interim dividend by 15%, after reporting growth in profits, buoyed by growth in BT Sport subscribers and its fibre broadband operations and due to cost cutting.
The company reported a pretax profit of GBP1.11 billion for the six months to September 30, up from GBP948 million a year earlier, even though revenue declined to GBP8.74 billion, from GBP8.94 billion. Its pretax profit in the fiscal second quarter rose to GBP690 million, from GBP609 million a year earlier, even though revenue fell to GBP4.38 billion, from GBP4.49 billion.
Chief Executive Gavin Patterson said the results were slightly ahead of market expectations, driven by reduced costs and higher operating earnings.
"Our Consumer business continues to perform well thanks to the impact of BT Sport where Premier League audiences are up around 45% on average. Fibre is also driving growth with one in three of our retail broadband customers enjoying super-fast speeds," he said in a statement.
BT raised its interim dividend by 15% to 3.9 pence, from 3.4p, on the back of the profit increase, and as it reaffirmed its outlook.
Revenue rose 7% in the second quarter in BT's consumer business, but declined 15% in its wholesale business, 5% in its global services division, 2% in Openreach, and fell 1% in its business operations.
Still, earnings before interest, tax, depreciation and amortisation rose in all divisions except wholesale, with Ebitda up 42% on the year in the consumer business.
Its overall Ebitda rose 1% in the second quarter to GBP1.45 billion, although it was flat for the first half as a whole at GBP2.89 billion. It said operating costs fell 1%.
It said it now has 344,000 fibre broadband net connections in Openreach, up 9% on the year.
"Our fibre footprint has increased to more than 21 million premises and will continue to grow. We continue to see strong demand across the market for the faster speeds that fibre offers," Patterson said.
"Further improving customer service remains a priority and Openreach is recruiting an additional 500 engineers to help us better serve our customers. We have also launched a range of new cloud-based products and services aimed at the business market," the CEO added.
Still BT shares were down 1.9% at 368.40 pence early Thursday, one of the worst-performing stocks on the FTSE 100.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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