BT group raised its dividend payout as profit increased due to higher demand for broadband services.
The British telecoms group reached 2.5 million customers of its fibre broadband as 203 000 people signed up for the high speed internet connection in the second quarter.
BT reported around 38 000 users signed up for its TV programs, including exclusive sport TV channels, mounting up the total of its TV customer base to more than 1 million.
“Our Consumer business continues to perform well thanks to the impact of BT Sport where Premier League audiences are up around 45 percent on average,” CEO Gavin Patterson said. “Fibre is also driving growth with one in three of our retail broadband customers enjoying super-fast speeds.”
BT gained the privilege to air next season of Premier League and Champions League football games for around £2 billion.
Competition has increased in the industry as BT took only 48% of all new net customers, down from previous periods, as rival BskyB focused on its promotional activity.
BT reported a 2% decrease in revenue to £4.38 billion in the second quarter. The companys consumer division increased 7% to £1.05 billion, including 17% growth in broadband and TV revenue.
Pre-tax profits rose 13% to £563 million in the second quarter, earnings per share fell 28% to 5.6 pence. Meanwhile, BT increased its interim dividend with 15% to 3.9 pence a share, which is due on February 9th.
Analysts are concerned what the consequence might be, if BT is forced to pay more for Premier League rights during the next auction. Last week the company was demoted from “equal weight” to “underweight” from Morgan Stanley, which said BT could pay up to £1bn for future Premier League rights, compared to the £246 million it paid for the current season.
BT group gained 0.03% on Wednesday and closed at GBX 375.50 in London. On Thursday the stock lost 3.04% to trade at GBX 364.10 at 11:59 GMT, marking a one-year decrease of 1.47%. The company is valued at £30.58 billion. According to the Financial times, the 21 analysts offering 12-month price targets for BT group have a median target of GBX 450.00, with a high estimate of GBX 600.00 and a low estimate of GBX 245.00. The median estimate represents a 19.84% increase from the last close price of GBX 375.50
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