The performance of the BT Group and how the various divisions stack up is under close scrutiny with those seeking to hive off the Openreach sector into its own FTSE 100 company keen to find further information to support their case, thus we have the latest set of financials for the BT Group - the second quarter up to the end of September 2015.
Openreach had a good quarter with operating profit up £26 million compared to the same quarter last year and the contribution of the GEA-FTTC/FTTP services to the revenue pot increases, fibre revenue was up 38% and lead to an overall growth in revenue of 2% in Openreach. As usual regulation had an impact, this quarter of around £30 million.
Openreach added some 415,000 net fibre based connections a significant improvement on the last quarter and this takes the number of fibre based customers to 5 million (21% of premises passed). Importantly with regards to competition the split between BT Retail and other providers has improved such that 49% of the new connections where from external providers e.g. Sky, TalkTalk, Vodafone. While many of the new fibre connections will have been existing ADSL/ADSL2+ customers upgrading some 160,000 new broadband connections took place in the last quarter.
"Operating costs were flat year on year with our cost transformation activities offset by the additional costs to deliver revenue growth and by the investments we are making to improve customer service. There was no benefit this quarter from the sale of redundant copper (Q2 2014/15: £6m). EBITDA grew 3% and depreciation and amortisation was 1% lower with operating profit up 9%.
Capital expenditure of £348m, which is after net grant funding of £61m (Q2 2014/15: £94m), was up 41%. This was mainly due to our fibre broadband rollout, connecting new homes, and higher volumes of Ethernet provision. For the year as a whole, we expect capital expenditure in Openreach to be above 2014/15 as we continue to invest in these areas."Openreach on costs and cap-ex
Looking at BT Consumer who run the retail operations, revenue was up but operating costs increased so while still presenting an operating profit it was 16% down on the same quarter last year. The 7% revenue increased was helped substantially by a 17% increase in revenue of TV and broadband and a 1% increase in revenue from calls and line rental. BT Consumer has some 7.9 million broadband customers now, adding 82,000 customers in the quarter and BT Mobile which launched in March 2015 now has some 200,000 customers. The TV bundles are providing popular with 106,000 BT TV customers added in the quarter to take the total to 1.3 million.
For those wanting to try and delve into the figures themselves the results are available for download from the BT website.