2005/6 | financial headlines
(1) Underlying excluding cuts in mobile termination rates, Albacom and Infonet (2) Before specific items(3) Excluding receipts from disposals
Group turnover £19.5bn 6% / 3% (1)
Profit before tax (2) £2.2bn 5%
Earnings per share (2) 19.5p 8%
Free cash flow £1.6bn 8% (3)
Full year dividend 11.9p 14%
Net debt £7.5bn 5%
Operational highlights of 2005/6
•8million Broadband connections
•New wave revenues now one third of total business
• Investment in 21st century network
•Regulatory settlement – launch of Openreach
•Continued targeted acquisitions – Atlanet, Cara, Total Network Solutions
Boardchanges
CorporateSocial Responsibility
DividendsYears ended 31 MarchTotal pence
15
10
5
02002 2003 2004 20062005
11.910.4
8.5
6.5
2.0
BT’s vision
To be dedicated to helpingcustomers thrivein a changing world
Consistent strategy
Helping our customersthrive in a changing world
21st Century Network
Defend traditionalImproved servicePrice innovationReduce costs/improve margin Aggressive and creative marketing
Grow new waveNetworked IT servicesBroadbandMobility
Consistent delivery
5.0
4.0
3.0
2.0
1.0
0
(1.0)
(2.0)
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2003/4 2004/52002/3 2005/6
%
Revenue | strong underlying* growth
* 2002/3 growth is adjusted to take account of Concert unwind* 2004/05 and 2005/6 excludes impact of mobile termination and revenues from Albacom and Infonet
Consumers | a broadband centric service provider
What is our strategy?Broadband-centred convergent services; a service culture
What do consumers want?Simple, high quality services; clear pricing; value for money
Examples of new services:High definition voice; BT Vision; BT Fusion; WiFi cordless phones; 8Mb broadband
Broadband Britain
Coverage 60% 99.7%2002 2006
BT Wholesale DSL Price£30.00 £8.40 per month
Take-up 200k 8 million
Speed 512kb up to 8Mb
BT Retail Services Internetaccess and email
Home MonitoringOpenzone
BT Yahoo!Home NetworkingBroadband Talk IT Manager
BT Fusion
BT Vision MusicEntertainment
Broadband | our services
Centred on the Home HubBringing it all together
Communications BT Fusion High DefinitionVoice
Home MonitoringDigital VaultManage Life
Small and medium businesses | a partner for changeWhat do businesses want? Personalised, localised service; reduced complexity;improved productivity
What is our strategy? Being an IT partner; BT Local Business
Examples of new services: Networked IT services; OneBill; BT Fusion for enterprise
Mobility | convergence is here
42% growth in revenue year on year to £292m
Converged products and servicesFusion, Onebill, Openzone
Wireless cities
Personalsafety
Remoteworking
Wirelessconnectivity
Car parkmonitoring
Wholesale customers | convergent network solutionsWhat do Wholesale customers want?High quality service, reliable delivery;equality of service/price
What is our strategy?Providing managed network solutionsfor fixed and mobile operators
Examples of new services: 21CN based services; BT Movio
Corporates | growing around the world
What do corporates want?Enterprise-wide solutions; a one-stop shop;reliability and security
What is our strategy? Providing global reach with local presence;building long-term customer relationships
Examples of new services:Converged wireless portfolio;sector specific propositions
Networked IT services | enhancing our capabilities
Reach Infonet, Albacom, KDDI joint venture
WAN & LANsCara, Skynet & TNS
Retail NSB, BT Expedite & dabs.com
Motor industryAtlanet
Bringing it all together
Financial ServicesRadianz
6
5
4
3
2
1
2003/4 2004/52002/3 2005/6
£Bn7 CAGR
0
+ 49%
Revenue | new wave growth accelerating
+ 83%
Mobility & OtherBroadbandNetworked IT Services
+ 24%
Basic earnings per share*Years ended 31 MarchPence
* From continuing activities
20
10
5
02002
15
2003 2004 20062005
19.518.116.9
14.4
9.0
IFRSUK GAAP
Bringing it all together
Strategy built around convergence & innovation
Consistently successful in competitive & dynamic marketsNew wave now accounts for a third of group revenueNetworked IT services provider of choice
Strong momentum with track record of deliverySIXTEEN quarters of EPS growthNINE quarters of revenue growthFIVE quarters of improvement in EBITDA trend
Positive operational trends will continueGrowing revenues, profits & dividends