BT Group glass half full, boosts shareholder dividends

Dividends helped BT Group (LSE:BT.A) to a positive trading day despite final results that disappointed slightly compared to market expectations.

BT on Thursday told investors it would be paying a final dividend of 5.69p, which takes the total for the year up to 8p per share.

It comes as BT highlighted an important milestone – passing the peak of capital investment needed to roll-out fibre broadband – and cheered its successful cost-cutting programme that’s axed some £3 billion of outgoings around a year ahead of schedule.

Actual trading metrics were less inspiring though with full year revenue marked at £20.8 billion rather than the £20.9 million forecast by City analysts. Underlying profit was up 2% at £8.10 billion, shy of a forecast pitched at £8.15 billion.

BT said it expected to grow earnings (EBTIDA) by between 0% and 1% in its current financial year..

Evidently, the improve dividend payout meant shareholders’ glasses were seen as half full, with BT shares rising 16% during Thursday’s session to finish near the 131.25p marker.

“Having passed peak capex on our full fibre broadband rollout and achieved our £3 billion cost and service transformation programme a year ahead of schedule, we've now reached the inflection point on our long-term strategy,” chief executive Allison Kirkby said.

"This delivery and greater capex efficiency gives us the confidence to provide new guidance for significantly increased short term cash flow and sets out a path to more than double our normalised free cash flow over the next five years.