BT Group (BT.A) announced their final results for the year ending March this morning. The share price is up 11% at the time of writing, perhaps mainly based on the positive comments of the CEO. Although revenue was pretty well unchanged and pre-tax profit fell. EPS was down 55% as was free cash flow. Net debt rose to £19.5bn and the massive pension deficit also increased.
The CEO said: “This delivery and greater capex efficiency gives us the confidence to provide new guidance for significantly increased short term cash flow and sets out a path to more than double our normalised free cash flow over the next five years. This enhanced cash flow allows us to increase our dividend for FY24 by 3.9% to 8.0 pence per share. We’re also setting a further £3bn of gross annualised cost savings to be reached by the end of FY29”.
The dividend increase means the yield is 6.3% on the current share price, which may be one of the few reasons to buy the shares. This is clearly a no growth business. This is the comment made on Stockopedia: “Huge net debt and giant pension contributions mean that the balance sheet has negative NTAV. Should it be paying such generous divis, when it has a mountain of debt?”. My answer would be NO.
The company is moving rapidly to replace its copper wires by fibre-optic cables and coincidentally BT changed our home/office broadband/phone line to fibre yesterday. They did not have to dig up too much of the garden. That went very smoothly so far although the phone line is still not working. Use the Roliscon contact page if you need to get an email to me: https://www.roliscon.com/contact-us
We also have a fibre service from Virgin to support our home TV service and home phone. The TV service suffered from picture break-up for the last three weeks and was only fixed a couple of days ago. I have complained and asked for a subscription refund particularly as they have become too expensive. Alternative suggestions would be welcomed.
Broadband and phone providers have been ratcheting up prices by having automatic increases to match retail price inflation in their contracts which I find unjustifiable as their costs don’t increase in that way.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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Whichever internet service you have the connection to the outside of the house is handled by Open Reach, a BT subsidiary, which in entirely separate to BT Internet.
The Internet provider will then bring the connection inside and typically provide and set up the router. Most also also have a “landline” which means you can make and receive landline calls, but these are done over the internet. This can be in addition to your copper phone line connection; these are being phased out next year.
Internet providers seem much of a muchness. Different providers offer different pricing structures and these can vary depending on your postcode.However Shell Energy seems to have a bad name, so you may want to look elsewhere.
We have Vodaphone at our holiday home and we can’t fault the installation or service. However they charge “inflation plus” annual increases which means that a low starting price can become expensive. Also be aware that outgoing calls on the internet phone line are venously priced if you don’t buy a package.
I hope this helps but let me know if you want any more information.