In its second quarter, BT hit revenue of £5,122 million, down 3%, or 6% excluding foreign exchange movements and acquisitions. Adjusted EBITDA was £1,436 million, up 2% reflecting progress in all lines of business.
There has been continued improvement in BT Global Services with adjusted EBITDA of £95 million, up 53% on the first quarter. Adjusted earnings per share were 4.5p, down 8%, with reported earnings per share of 5.5p, up 12%.
Free cash flow was £705 million, up £336 million including a tax repayment and associated interest of £226 million. Net debt reduced to £9.9 billion, with total underlying costs down £932 million in the half year.
Ian Livingston, chief executive, commenting on the results, said: “We have had another quarter of progress but there remains a lot more to do. With total cost reductions of over £900 million in the first half, we have made significant headway towards our previous target of well over £1 billion for the full year. We now expect to generate at least £1.6 billion of free cash flow this year, compared with our previous target of over £1 billion.
“We are investing in the future of the business with an enhanced and accelerated programme of fibre deployment and wider roll out of faster broadband speeds, all within our capital expenditure plans.
“Given our operational performance, we expect to increase dividends by around 5% for the full year. The Board is declaring an interim dividend of 2.3p per share.”