Week Ahead

BT expectations low as Kirkby seeks growth

BT
BT is facing tough competition

BT is being squeezed by competition and regulation which is putting pressure on dividends , leaving its shares back at levels first witnessed in the immediate aftermath of the company’s stock market flotation in late 1984.

At least this means that expectations are low as Allison Kirkby becomes the latest BT boss to try to negotiate the many cross-currents that face the company, say analysts at AJ Bell.

In a briefing note, they says this is probably no bad thing, as BT is finding it hard to generate much by way of growth overall, even as Openreach, which continues to build out Fibre to the Premises (FTTP) to improve the nation’s broadband infrastructure, and EE add business and retail customers alike. Ms Kirkby reaffirmed full-year guidance alongside the third-quarter update back in February.

BT expects growth in both sales and adjusted EBITDA for the year to March 2024. Consensus forecasts are looking for 2.1% sales growth to £20.9 billion and a 2% increase in adjusted EBITDA to £8.1 billion, ahead of a 0.8% gain and 1.4% gain to £21 billion and £8.3 billion respectively in fiscal 2025.

The company expects capital investment of £5 billion in the year to March 2024, compared to £5.3 billion a year ago

No change is expected in BT’s annual dividend of 7.7p a share and the firm does not run a share buyback programme.

Other notable corporate announcements include an update from Lloyds Banking Group which holds in annual general meeting. Greggs and Virgin Money will present trading updates.

Unemployment figures due out on Tuesday will give further pointers to the Bank of England ahead of a possible interest rate cut next month and to the Conservative government which is looking to a pick up in economic activity to boost its re-election chances.

DIARY

Monday 13 May

  • First-half results from Diploma, Victrex and Cerillion

Tuesday 14 May

  • Full-year results from DCC
  • First-half results from Treatt and On The Beach
  • Trading statements from Flutter Entertainment, Greggs, Virgin Money UK and Currys
  • UK unemployment, job vacancies and wage growth

Wednesday 15 May

  • Full-year results from Compass, Experian and Vertu Motors
  • First-half results from Imperial Brands and Britvic
  • Trading updates and quarterly results from Spirax-Sarco and Keller
  • US consumer price inflation

Thursday 16 May

  • Full-year results from BT, United Utilities and Premier Foods
  • First-half results from Sage, easyJet, Grainger, Future, Auction Technology and Tritax Eurobox
  • AGM at Lloyds Banking Group

Friday 17 May

  • Full-year results from Land Securities
  • Chinese monthly industrial production, retail sales and fixed asset investment
  • EU inflation


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