BT revenue boosted by price rises and retail fibre uptake

Incumbent BT has become the latest UK telco to post higher turnover off the back of price hikes.

In the three months to 30 June, revenue at BT Consumer rose 3% on last year to £2.42 billion, which CEO Philip Jansen attributed to a combination of higher fees and take-up of “higher performance connections,” which presumably means FTTP and 5G.

BT raised its prices by 14.4% at the end of March to account for December’s consumer price index (CPI) inflation rate of 10.5%, plus an extra 3.9% as per its contract terms.

It doesn’t seem to have caused a customer exodus though – probably because every other major UK telco implemented steep price increases too. At the end of June, BT’s retail fibre customer base jumped by 50% year-on-year to 2 million. Mobile arm EE saw its 5G customer base increase by 53% to 9.2 million.

Similarly earlier this week Vodafone reported a 5.7% increase in service revenue at its UK operation, which attributed to higher prices and a stable customer base.

Virgin Media O2 (VMO2) this week also posted revenue gains – its turnover increased 6.2% to £2.7 billion. Once again, higher prices played their part, as its mobile division grew sales by 4.7%. However, unlike Vodafone and BT, VMO2 is finding it harder to hold onto customers – its its fixed and postpaid mobile operations lost 24,700 and 1,500 customers respectively during the quarter.

Meanwhile, BT’s wholesale arm Openreach had a good fiscal first quarter too, posting revenue of £1.53 billion, up 8 percent on last year. FTTP net additions came in at 383,000, comfortably offsetting a 126,000 decline in slower broadband connections, as retail ISPs lost customers and continued to withdraw copper-based services. The total number of active FTTP connections on Openreach’s network now stands at 3.5 million.

Its fibre deployment continues to rumble on at an impressive pace. Its network passed an additional 718,000 premises during the quarter. Its footprint now stands at 11 million premises, or 44 percent of its target of 25 million.

There was even good news at BT Business, which – thanks to higher orders – grew sales by 3 percent to £2.03 billion.

With good sales figures across the board, BT’s group revenue rose to £5.16 billion in Q1, up from £4.98 billion a year earlier.

With BT keeping a tight lid on costs during its ongoing turnaround, the increase in revenue resulted in a 5% up-tick in adjusted EBITDA, which came in at £2.03 billion.

“We’ve made a strong start to the year, in what remains a very competitive market, with improved customer satisfaction, pro forma revenue growth in all of our business units and pro forma group EBITDA up by 5 percent,” said Jansen, who is due to step down as BT CEO in the next 12 months.

“We continue to drive transformation across the group, and while there remains much to do it’s clear that our strategy is working and BT Group is set up for success,” he said.

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