Amid takeover speculation, U.K. telco BT reported a 3% decline in revenue to 10.3 billion British pounds ($14 billion) for the first half of its fiscal year, which ended on Sept. 30, but said its BT Openreach fiber broadband unit posted a 5% increase in revenue to about 2.7 billion pounds ($3.6 billion.)
BT’s financial results for its first half were reported to be in line with expectations. Despite the growth at Openreach, enterprise segment revenue was down 5% compared to the same period last year, global revenue was down 14% year over year and consumer revenue was flat. The company reported pre-tax profit of 1 billion pounds ($1.3 billion) and adjusted EBITDA of 3.75 billion pounds ($5 billion.)
The company also reported capital expenses of more than 2.5 billion pounds during the period, a 30% year-over-year increase, saying the spike was primarily due to wireless spectrum expenses.
The Openreach revenue figure is significant as the operator faces a growing number of fiber broadband competitors--as many as 10--flooding the U.K. market. The company also said the cost of rolling out fiber is declining, and now stands between 250 and 250 pounds per premises passed
"After a record six months, Openreach has now rolled out full fibre broadband to almost 6 million premises and continues to lower its build cost,” said BT CEO Philip Jansen. “Its three largest customers are signed up to the new pricing offer as we see rapid adoption of what will be the U.K.’s first nationwide full fibre network spanning 25 million premises by 2026.”
RELATED: BT’s Openreach raises fiber goal to 25M premises by 2026
He added that BT’s 5G network now reaches more than 40% of the U.K.'s population.
Jansen also said the company had hit its goal of 1 billion pounds in cost saving about 18 month earlier than planned, meaning that its also is accelerating its goal of 2 billion pounds in cost savings from its 2025 fiscal year to its 2024 fiscal year. BT confirmed its previous earnings outlook for 2022 and 2023.
The earnings report came amid ongoing speculation that BT could be ripe for a takeover bid, potentially from Patrick Drahi, who recently became the company’s largest shareholder with a stake of 12.1%. As a result, BT hired Robey Warshaw to advise the operator on defending itself from a takeover bid.