Openreach, the wholly-owned, independent fixed access infrastructure arm of UK multiplay telco BT, says it is building Fibre-to-the-Premises (FTTP) faster, at lower cost and higher quality than anyone else in the UK.
In the last year, Openreach passed a record 2 million premises with FTTP. Openreach now believes that it has the capability to reach around 4 million premises a year. Given this build confidence, encouraging take-up on the current FTTP footprint, the regulatory clarity provided by Ofcom’s Wholesale Fixed Telecoms Market Review, coupled with the Government’s recent cash tax super-deduction and the positive outcome from the recent 5G spectrum auction, BT has decided that the conditions are right to increase and accelerate its total FTTP build from 20 million to 25 million premises by December 2026.
Openreach will start its ramp up to 4 million premises a year with immediate effect. BT has 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, committing to a minimum credit rating of BBB flat, supporting the BT Pension Scheme and reinstating its dividend in the current financial year at 7.7 pence per share.
BT believes it could deliver further shareholder value by funding the additional 5 million premises through a joint venture with external parties and will explore joint venture structures over the first half of the current financial year.
”BT is already building more full fibre broadband to homes and businesses than anyone else in the UK,” asserts Philip Jansen, Chief Executive, BT Group. “Today we are increasing our FTTP target from 20 million to 25 million homes and businesses to deliver further value to our shareholders and support the Government’s full fibre ambitions.”
“This has three massive benefits: it allows us to go faster, beefing up our capacity to build fibre to households and businesses; it allows us to go further, getting fibre to more people including in rural communities, and; it will help fuel UK economic recovery, with better connectivity and up to 7,000 new jobs.”
The initiative comes as BT revealed its Full Year results, saying its Financials delivered in line with guidance primarily impacted by Covid-19. Revenue was £21.331 billion, down 7 per cent, including reduced BT Sport revenue and the closures of retail stores and pubs and clubs, as well as a reduction in business activity in its enterprise units. Reported profit before tax was £1.804 million, down 23 per cent, primarily down to reduced EBITDA. Reported operating costs were £18,744 billion, down 4 per cent, mainly driven by sports rights rebates and savings including its modernisation programme, tight cost control, and Covid-19 mitigation actions.