BT (BT.A) on Thursday said it will cut up to 55,000 jobs by 2030, as it reported a decline in profit and revenue for its recent financial year.
The London-based telecommunications provider said it will reduce its number of workers to between 75,000 and 90,000 by financial years 2028 to 2030 from 130,000 currently. This is a reduction of between 31% and 42%.
“By continuing to build and connect like fury, digitise the way we work, and simplify our structure, by the end of the 2020s BT Group will rely on a much smaller workforce and a significantly reduced cost base. New BT Group will be a leaner business with a brighter future,” said Chief Executive Officer Philip Jansen.
The move is likely to stoke the ire of BT’s unionised workers. Last year, they walked out during industrial action by unions including the Communications Workers Union.
BT shares were down 9.0% to 134.85p each in London on Thursday morning, the worst FTSE 100 performer.
BT said that, despite an “extraordinary” macro-economic backdrop, it delivered on its guidance, growing pro-forma revenue and adjusted earnings before interest, tax, depreciation, and amortisation.
In the financial year that ended March 31, revenue edged down 0.8% to £20.68 billion from £20.85 billion, but was 0.8% higher than the £20.51 billion estimated by Financial Times-cited market consensus. Adjusted EBITDA rose 4.6% to £7.93 billion from £7.58 billion.
Revenue was up 1% and adjusted EBITDA was up 3% on a ‘sports joint venture’ pro forma basis, BT said.
Back in May last year, BT agreed a deal with Warner Bros Discovery to combine in a joint venture its sports television channel BT Sport with Warner Bros’ Eurosport.
BT said annual pretax profit fell 12% to £1.73 billion from £1.96 billion.
Diluted earnings per share rose 13% to 21.4 pence per share from 18.9p, outperforming analyst expectations of 19.54p by 9.5%. The figure of 18.9p for financial 2022 was a downward revision by 4.1% from previously reported 19.7p.
Looking ahead, BT expects revenue and Ebitda growth on pro forma basis in financial 2024, despite expected headwinds from cost-of-living, inflation, and higher energy costs. The company anticipates a normalised free cash flow of between £1.0 billion and £1.2 billion, down from £1.3 billion in financial 2023. This is due to the ta benefit from full expensing being fully offset by higher capital expenditure, BT explains.
BT maintained its total annual dividend at 7.7 pence, including an unchanged final dividend of 5.39p.
