BT confirms plans to accelerate FTTP rollout as it publishes FY21 financial results

14 May 2021

UK-based BT Group has reportedly decided that the conditions are right to increase and accelerate its total fibre-to-the-premises (FTTP) build from 20 million premises to 25 million premises by December 2026. In doing so, the company cited several factors, including the ‘encouraging’ take-up on its current FTTP footprint, the regulatory clarity provided by Ofcom’s Wholesale Fixed Telecoms Market Review, the UK government’s recent cash tax super-deduction, and the positive outcome from the country’s recent 5G spectrum auction. Moreover, BT also said the decision had been made based on the build confidence of Openreach, its wholly-owned, independent fixed access infrastructure arm; according to BT, with Openreach having passed a record two million premises with FTTP over the past year, the network unit now believes it has the capability to reach around four million premises a year.

As part of the accelerated rollout plans, BT said that Openreach will begin ramping up to four million premises a year with immediate effect. BT claims to have the capacity to fund this additional build entirely from internal resources while continuing to stand by its other priorities, including investing in 5G and its modernisation programme. However, the company did note that it believes it could deliver further shareholder value by funding the additional five million premises it aims to reach under the expanded rollout strategy through a joint venture with external parties. To that end, it confirmed plans to explore joint venture structures over the first half of the current financial year (which ends 31 March 2022).

Meanwhile, alongside its enhanced FTTP rollout plans, BT has also published its results for the financial year ended 31 March 2021. Revenues for the period under review totalled GBP21.331 billion (USD29.9 billion), representing a 7% year-on-year decline, which it said was ‘primarily due to the impact of COVID-19 on Consumer and [its] enterprise units, ongoing legacy product declines and divestments, partly offset by higher equipment revenue and Openreach bases in fibre and Ethernet’. Adjusted EBITDA in FY21 totalled GBP7.415 billion, down 6% on an annualised basis, with the drop attributed to lower turnover, a special frontline bonus for workers during the pandemic, increased service costs and continued investment in copper-to-fibre migrations. However, it noted that these were partly offset by sports rights rebates and cost savings including a modernisation programme. BT’s reported profit before tax declined by 23% y-o-y, meanwhile, to GBP1.804 billion, primarily due to reduced EBITDA. The company’s capital expenditure was GBP4.216 billion, up 6% from the previous fiscal year.

In terms of operational highlights, BT confirmed that its ‘Fibre First’ FTTP build programme had reached more than 560 locations by 31 March 2021, with its full fibre rollout reaching record levels in the fourth quarter of its financial year, building at an average run-rate of 43,000 premises passed per week. With the FTTP network in reach of 4.610 million premises as of March 2021, up from 2.575 million a year earlier, BT noted that the number of active FTTP connections had increased significantly from 524,000 to 905,000. In the mobile arena, meanwhile, BT reported that subsidiary EE was now offering 5G connectivity in 160 locations across the country, having extended coverage to 35 new towns in the last quarter of the financial year. Further, the number of ‘5G ready’ customers – defined as those ‘receiving or capable of receiving 5G network connection from a 5G enabled SIM’ – had increased to 3.261 million, from just 53,000 a year earlier.

United Kingdom, BT Group (incl. Openreach), EE, Openreach