- To cut jobs after fibre build-out ends
- Free cash flow comes in at bottom of guidance
- Meets expectations for annual core earnings growth
- Shares down 9%
By Paul Sandle
LONDON, May 18 (Reuters) – BT Group , Britain’s biggest broadband and mobile provider, said on Thursday it would reduce its total workforce, including contractors, by up to 55,000 jobs by the end of the decade to become a much leaner business.
BT, which set out the plan as it reported pro forma revenue and core earnings growth for the first time in six years in the year to end-March, has been working through a transformation plan to build a national fibre network under boss Philip Jansen.
He said after completing the fibre roll-out, digitising the way it worked and simplifying its structure, BT would rely on a much smaller workforce and significantly reduced cost base by the end of the 2020s.
“New BT Group will be a leaner business with a brighter future,” he said on Thursday.
The group’s total number of workers would reduce from 130,000 to between 75,000 and 90,000 by its 2030 financial year at the latest, it said.
By that time the bulk of its full-fibre network build will be completed.
Reporting full year results, Jansen said BT had made good progress while navigating an “extraordinary macro-economic backdrop”.
It met market expectations with a 5% rise in full-year adjusted core earnings of 7.9 billion pounds ($10 billion) after growth in networks and consumer offset a decline in enterprise.
But free cashflow fell 5% to 1.3 billion pounds, at the lower end of its guidance, due to increased cash capital expenditure.
Its shares opened down 9%.
The group’s networks arm Openreach had reaffirmed its target to reach 25 million premises with full-fibre connections by the end of 2026, and it planned to further accelerate take-up of the ultrafast broadband the lines offered.
It has been investing heavily to build out its fibre network faster than rival Virgin Media O2 and smaller “alt nets”.
BT said it expected to grow both revenue and core earnings on a pro forma basis this year.
($1 = 0.7923 pounds)
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