BT sees increasing fibre demand, but sales remain flat

BT attracts new fibre customers but fails to translate growth to revenues in the second quarter of 2014

Demand for BT’s consumer broadband products grew substantially during the second quarter of 2014, but not at a great enough rate to meaningfully impact the operator’s revenues.

Total sales across BT hit £4.38bn in the three months to 30 September 2014, down by 2% year-on-year – up 0.2% on an underlying revenue basis. Earnings before interest, taxes, depreciation and amortisation were also flat, up by just 1% year-on-year to £1.45bn, in spite of its investments in fibre and the successful BT Sport service.

Sales were up by 7% at BT Consumer, thanks to broadband and TV revenue. BT said it had now outpaced its rivals in terms of new broadband customers for five quarters in a row.

However, this was not enough to offset declines of 5% at BT Global Services, 1% at BT Business, 2% at Openreach and 15% at BT Wholesale.

BT chief executive Gavin Patterson said the company's consumer business continues to perform well as a result of BT Sport, where Premier League audiences are up by around 45% on average.

“Fibre is also driving growth with one in three of our retail broadband customers enjoying superfast speeds,” he said.

“Our fibre footprint has increased to more than 21 million premises and will continue to grow. We continue to see strong demand across the market for the faster speeds fibre offers.

“Further improving customer service remains a priority and Openreach is recruiting an additional 500 engineers to help us better serve our customers. We have also launched a range of new cloud-based products and services aimed at the business market,” he added.

BDUK roll-out continuing unabated

The Openreach fibre network is now passing more than 60,000 premises per week, mostly thanks to Broadband Delivery UK (BDUK), BT said in a statement released in support of its quarterly results.

The operator said 344,000 customers connected to the Openreach network during the second quarter of 2014, up by 9% on 2013, meaning BT is now adding a new fibre customer every 22 seconds on average.

It also said 203,000 of those customers – just under 60% – connected via BT Retail, while 40% connected through other internet service providers (ISPs). BT Retail’s fibre customer base stands at 2.5 million homes and businesses.

The total Openreach fibre customer base is now 3.3 million homes and businesses, up slightly on a quarterly basis

The operator added that just over a third of its retail broadband customers were now on fibre, rather than copper.

Read more on Telecoms networks and broadband communications