BT has announced reported revenue of GBP 17.25 billion and adjusted revenue of GBP 17.19 billion for the nine months to 31 December 2019, both down 2 percent on the effects of regulation, competition and legacy product declines. The company also warned that the recent government decision on the use of certain network vendors would cost the company around GBP 500 million over five years.
Reported profit before tax was GBP 1.91 billion for the nine months, with EBITDA down 3 percent to GBP 5.90 billion due to lower revenue, higher spectrum fees, higher operating costs for Openreach and customer service investment. Normalised free cash flow was down 42 percent to GBP 1 billion as a result of increased cash capital expenditure, payment for UEFA football rights, higher interest and tax payments and working capital.
Capital expenditure for the nine months was GBP 2.88 billion, up by GBP 251 million excluding BDUK funding deferral, driven by investment in the fixed and mobile networks. BT has maintained its overall financial outlook, and expects normalised free cash flow to be in the lower half of the GBP 1.9-2.1 billion full-year guidance range.
Consumer fixed ARPC was GBP 38.20 for the nine months, down 4 percent year-on-year on lower voice revenue. Post-paid mobile ARPC was down 5 percent to GBP 20.30 on the impact of regulation and continued trend towards SIM-only. The number of RGUs per address was 2.38, and post-paid mobile churn was 1.3 percent in the third quarter. Fixed churn was 1.3 percent in Q3, down from 1.4 percent a year earlier, boosted by improvements to customer service and a new pricing strategy. Openreach's FTTP network build passed around 26,000 premises per week, with a total of 2.2 million premises passed to date.
The Global services division reported adjusted revenue of GBP 3.28 billion for the nine months, down 7 percent from GBP 3.53 billion a year earlier, with adjusted EBITDA for the nine months up 7 percent to GBP 459 million, from GBP 428 million.
Global services revenue for the third quarter was GBP 1.08 billion, down 10 percent from GBP 1.20 billion in the year-earlier quarter, with adjusted EBITDA down 10 percent to GBP 155 million, from GBP 173 million. The fall in revenue was driven by the decision to reduce lower-margin businesses, divestments and legacy product declines, offset partially by growth in security. Order intake in Q3 was GBP 1.2 billion, up 37 percent, boosted by several large contract renewals. On a rolling 12-month basis, order intake was up 21 percent to GBP 4 billion.
