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Picture: 123RF
Picture: 123RF

London — The new boss of BT set out a path to more than double free cash flow over the next five years and potentially dispose of its global business as it focuses on Britain where it has been investing heavily, sending its shares up 9%.

Allison Kirkby, who previously led Sweden’s Telia, said on Thursday that BT would increase its dividend for the 2024 financial year by 3.9% to 8p per share after free cash flow beat expectations.

The group’s shares traded up 9% at 123p in early trade, hitting a four-month high and on course for their biggest one-day gain since November 2021.

Hargreaves Lansdown analyst Matt Britzman said the company was making good progress on reducing costs under Kirby who started in the top job in February.

“BT’s future relies heavily on getting past the peak fibre buildout phase, and to its credit, progress looks good,” he said.

Kirkby’s predecessor Philip Jansen set out an ambitious target to build a national fibre network reaching 25-million premises by the end of 2026 and BT has been investing in building that and in its 5G networks.

“We are sharpening our focus to be better for our customers and the country, by accelerating the modernisation of our operations, and by exploring options to optimise our global business,” she said.

BT reported a 1% rise in full-year revenue to £20.8bn ($26.4bn), helped by price rises and fibre-enabled product sales.

Adjusted core earnings rose 2% to £8.1bn, broadly in line with expectations, driven by its consumer and Openreach networks businesses.

It said it expected revenue to be flat to up 1% this year, while core earnings were forecast to edge up to about £8.2bn.

BT said its Openreach unit, which serves Sky and TalkTalk as well as BT’s own consumers, was seeing strong demand for fibre, with net adds of 397,000 in the final quarter and more than 4.8-million premises now connected.

Reuters

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