BT Group (LSE:BT.A) delivered a solid start to its financial year, with continued growth in full-fibre broadband and 5G services helping offset ongoing declines in legacy voice revenues. The company reported record demand for its full-fibre products, while its 5G+ network now covers 77% of the UK population. Fibre connections across the Openreach and Consumer divisions generated more than half of broadband revenue for the first time, and EE maintained its position as the UK’s leading mobile network. Customer churn also remained low across both broadband and postpaid mobile despite a competitive market environment.
Fibre rollout and Verizon venture support long-term strategy
BT remains on course to expand its fibre-to-the-premises (FTTP) network to 25 million premises by December 2026, reinforcing its long-term investment in the UK’s digital infrastructure.
The company also announced a joint venture with Verizon to establish a larger global connectivity business, enabling BT to sharpen its strategic focus on its core UK operations. First-quarter revenue and adjusted EBITDA were broadly unchanged from the previous year, as growth in fibre and business connectivity services was offset by continuing declines in traditional voice services. However, ongoing cost-saving initiatives, lower energy consumption and reduced labour costs helped protect margins.
Management reaffirmed its financial guidance, including expectations for normalised free cash flow of approximately £2.0 billion this financial year and around £3.0 billion by the end of the decade.
Transformation strategy underpins outlook
BT’s outlook continues to be supported by resilient operating cash flow, stable EBITDA and continued progress on its transformation programme. While revenue growth remains modest and leverage continues to be monitored, management’s confidence in delivering its long-term financial targets provides a positive backdrop.
Valuation remains relatively demanding, with a higher price-to-earnings multiple limiting some upside potential, while technical indicators currently point to a broadly neutral-to-slightly negative trend in the shares.
About BT Group
BT Group plc is one of the UK’s largest telecommunications providers, operating through its Consumer, Business and Openreach divisions. The company supplies broadband, mobile, full-fibre and enterprise connectivity services while continuing to invest heavily in fibre-to-the-premises and 5G infrastructure. BT also serves corporate and public sector customers with critical communications services and is reshaping its international operations through a planned joint venture with Verizon as it focuses on long-term growth in the UK market.
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