BT Group Fiscal Year 2022 Pretax Profit Rose; Finalizes Sports JV With Warner Bros. Discovery -- 2nd Update
12 May 2022 - 10:05PM
Dow Jones News
By Kyle Morris
BT Group PLC said Thursday that pretax profit for fiscal 2022
rose and that it has finalized the sports joint venture in the U.K.
and Ireland with Warner Bros. Discovery.
The U.K. telecommunications group said that as part of the 50-50
sports JV it will receive 93 million pounds ($113.9 million) from
Warner Bros. Discovery and up to around GBP540 million by way of an
earn-out, subject to certain conditions. As part of the agreement
the operating businesses of BT Sport will be transferred to Warner
Bros. Discovery.
The joint venture will combine BT Sport and Eurosport UK, with a
portfolio including rights to the UEFA Champions League, the
Premier League, UFC, the Olympic Games, tennis grand slams and the
winter sports World Cup season.
A new longer-term reciprocal channel supply deal, going beyond
2030, has also been agreed with Sky, it said.
Additionally, the company reported its results for fiscal 2022,
including pretax profit for the year ended March 31 of GBP1.96
billion compared with GBP1.80 billion for fiscal 2021. Revenue was
GBP20.85 billion compared with GBP21.33 billion a year earlier,
reflecting a decline in enterprise and global. Adjusted earnings
before interest, taxes, depreciation and amortization--which strips
out exceptional and other one-off items--was GBP7.6 billion, it
said, up 2%.
Analysts expected BT to report fiscal 2022 revenue at GBP20.88
billion and pretax profit of GBP2.08 billion, according to
consensus estimates provided by FactSet.
Following completion of the sports JV, expected by the end of
2022, the company sees group revenue reducing by GBP500 million to
GBP600 million a year relative to fiscal 2022. The full impact on
outlook metrics will be confirmed following completion, it
said.
The group added that the IAS 19 gross pensions deficit was
GBP1.1 billion, compared with GBP5.1 billion a year earlier, due to
an increase in real discount rate, deficit contributions paid,
changes to demographic assumptions and positive asset returns.
BT said it is extending the cost savings target of GBP2 billion
by the end of fiscal 2024 to GBP2.5 billion by the end of fiscal
2025. Goss annualized cost savings totaling GBP1.5 billion have now
been achieved, it said.
No material adverse impact on customer churn rates have been
experienced in response to price increases announced it February,
it said.
For fiscal 2023, the company sees adjusted revenue to grow
year-on-year and adjusted Ebitda of at least GBP7.9 billion.
The company declared a final dividend of 5.39 pence a share,
bringing the full-year payout to 7.70 pence a share.
"While the economic outlook remains challenging, we're
continuing to invest for the future and I am confident that BT
Group is on the right track," Chief Executive Philip Jansen
said.
Shares in BT at 1131 GMT were up 5.60 pence, or 3.2%, at 182.25
pence.
Write to Kyle Morris at kyle.morris@dowjones.com
(END) Dow Jones Newswires
May 12, 2022 07:50 ET (11:50 GMT)
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