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BT net debt increased by £649 Million at the H1.
On FY 2023 their net debt increased by another £1 bn.
Unsustainable.
IF cash flow covered CAPEX, the pension recovery payments And the dividend, net debt eould Not be increasing.
Let's see how it looks at the FY, but that's how it looks to me - current payout is unsustainable IMV.
Telcos a lowly rated sector atm
Take Orange SA. Yield of around 6.5%, which looks secure (no guarantees as always).
Orange with markedly lower debt kevels than BT - when
looking at debt in the context of either free cash flow or pre tax profit and a stronger longer term financial record.
Yet you can buy Orange SA at under 10X earnings.
BT is not at a give away share price imv, given dividend uncertainty and increasing net debt.
Until there is clarification very poor sentiment may well continue.
Dividend uncertainty yes would agree.
The regulator is not manipulating the BT share price,
other than that you make some good points.
I've mentioned the same a number if times...BT will not be allowed to become a cash machine.
* and it may be that I'm a mile out..
(Still no Edit function on LSE!).
The 3 nearest refinancings had a coupon of less than 3%,
one of those well under 2%.
BT will not have any issue refinancing, it's the rate they can
issue debt at - that is my point.
Like anyone else I can only give a best guess on the future dividend, profitability etc and it nay be that I'm a mike out.
However, it's indisputable that their net debt is increasing.
* because borrowings increasing year on year will ultimately impact their credit rating - and this largely determines the rate at which BT issue bonds.
You can look at the BT debt profile online.
* on the back of a 14% increases to many end consumers.
Dividend rebase incomming is my best guess.
It makes less than zero difference to the BT SP if he has an 'agenda' or not.
Unless you are saying ..his posts should be read within a particular context.
Better to ask . what's the buy case for BT
Obvs this is guesswork only, however my guess is yes,
a 30% cut or there abouts. This gives more leeway for increases down the line.
Given BT net debt continues to increase and as importantly the cost of servicing that debt is increasing -
a dividend cut makes sense.
I've got a BT landline, from memory I was informed it was needed with my broadband deal?- I've not used a landline in years calls, I don't even know what my landline number is - so looking forward to getting some money back from BT.
As I have mentioned on here several times over the years ..
any view BT is heading for years of strong profit growth (once the pension deficit recovery payments and major CAPEX programme complete) is likely to be misplaced.
Politically and regulatory considerations mean big headwinds continue long in to the future.
That includes 2 mobiles, BT TV, broadband...etc.
Come my renewal in March (if I stay with BT) that
monthly outlay will be slashed. I'm currently paying for
a lot I don't use, or don't have time to
How many others will look to cut packages given cost of living considerations...
Strip out Guiness snd DGE is a spirits business.
Many of DGE's products are consumed in the home.
How busy UK pubs may be tells you very little as a read on Diageo.
DGE central strategy over the last decade plus has been premiumisation - if that consumer trend is reversing DGE may have a big headache ahead.
Good call by bears here
It's not just a case of whether you.. believe in . their long term business plan - because they are reliant on Rolex to
provide the stock and more importantly a favourable product mix.
It's the product mix pount which may be a vital one.