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BT's new CEO lifts fibre target, aims to hold dividend

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BT's new CEO lifts fibre target, aims to hold dividend
FILE PHOTO: British Telecom (BT)'s headquarters is seen in central London, Britain May 10, 2018. REUTERS/Hannah McKay   -   Copyright  HANNAH MCKAY(Reuters)
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LONDON (Reuters) – The new chief executive of BT vowed to increase the company’s fibre roll out to 15 million premises by the mid 2020s, and maintain payouts to investors, if regulators set the right conditions for the telecoms giant.

“Our aim is to deliver the best converged network and be the leader in fixed ultrafast and mobile 5G networks,” Philip Jansen said in his first set of results. “We are increasingly confident in the environment for investment in the UK.”

Britain has lagged European rivals in building ultrafast connections, and BT, which operates the national fibre and copper-based network, has come under pressure to do more.

The former monopoly also clashed with the regulator under the leadership of its previous CEO, Gavin Patterson, over how much it could charge rivals and customers to use its infrastructure as it sought to balance the needs of investors with a programme to build the country’s next generation network.

Jansen said its fibre-to-the-premises build target had increased from 3 million to 4 million premises passed by March 2021, and its ambition increased from 10 million to 15 million by mid-2020s subject to suitable regulatory conditions.

Analysts have previously questioned whether BT could increase investment and maintain its payments to shareholders.

Jansen, however, said BT expected to be able to hold its dividend again in respect of the current financial year.

It reported adjusted revenue of 23.46 billion pounds for the year to the end of March, down 1 percent, as growth in its consumer unit was offset by regulated price reductions in the network business Openreach and declines in enterprise.

Adjusted core earnings fell by 2 percent to 7.39 billion pounds, broadly in line with analyst expectations of 7.41 billion pounds.

For the 2019/20 year it forecast adjusted core earnings of 7.2 billion pounds to 7.3 billion pounds. Its shares were up 2 percent in initial trading. 

(Reporting by Paul Sandle; Editing by Kate Holton/Keith Weir)

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