BT expected to reveal a 2pc fall in revenue despite raising prices

ANALYSTS IN the City will be waiting to see whether the cost of living crisis has seen an exodus in subscribers from telecoms giant BT when the company reveals its results on Thursday.

Netflix said recently its own subscriber base had suffered as households cut back. Investors in BT are hoping similar trends are not being seen more broadly.

Bosses are expected to tell the City revenues dropped in the past year as it faces rising costs which have already been passed onto customers.

Analysts predict the company’s total group revenue to fall by 2.3 per cent to £20.9 billion in the year to March 2022, with the fullyear results published on Thursday. BT says it has had to make tough pricing decisions this year as the cost of investing in its networks shot up due to increased demand for mobile data and in response to soaring inflation rates.

The network provider says it raises prices in line with the consumer price index (CPI) plus 3.9 per cent, meaning customers could face bill increases of up to 11 per cent following the latest CPI inflation reading of 7 per cent.

The company, which owns mobile provider EE, said data usage by customers has risen rapidly which means it has had to spend more on its networks to handle the increased demand. However, financially vulnerable customers on its social tariff and basic packages are promised price freezes.

There is takeover speculation at BT in part fuelled by an 18 per cent stake acquired by French telecoms magnate Patrick Drahi in December. BT was also in talks with Eurosport owner Discovery to create a joint venture that would prop up its BT Sport division.

BT said Mr Drahi had no intention of making an offer in a sixmonth no-bid clause that expires on June 14, although he is entitled to increase his stake in the company during that time.

But analysts question the likelihood of the Government allowing a takeover in light of a growing number of UK companies sold to private equity firms and overseas investors. Shareholders will also be looking to see how BT’s 5G fibre rollout has affected its balance sheets. The company plans 5G cover for 25m homes and businesses by 2026.