Not mentioned yet but BT's quarterly results came out at the end of last week.
Changes vs same quarter in prior year (slide 3/13):
Broadband & TV revenue - Up 20.7%
Total Consumer revenue - Up 9.2%
EBITDA - Down 7.4%
Operating profit - Down 10.1%
So continued strong top line growth but increased costs relating to the CL are such that the bottom line falls.
Contrast with the financial year to the end of March 2016 where EBITDA and Operating profit both actually rose marginally.
When looking at profitability with the new CL contract, the financial year doesn't match the football season so the March year end numbers obviously didn't include a full year of CL costs.
If we reconstruct the P&L to look at the 12 months to June 2016 we get:
EBITDA:
12 months to June 2016 - £1,036m
12 months to June 2015 - £1,061m
Change = Down 2.4%
Operating profit:
12 months to June 2016 - £827m
12 months to June 2015 - £848m
Change = Down 2.5%
I think that still has to be considered a pretty remarkable result - the bottom line only falling very slightly despite the huge cost increase from the CL. The CL costs will now remain flat for the next 2 years so further revenue growth will then feed through to the bottom line.
BT does face some cost inflation going forward - though nothing remotely like that facing Sky:
- BT's PL costs rise £74m this season under the new PL contract and they will have Australian cricket for the first time this year (believed to be approx £16m) and there may be some other inflationary increases re the likes of UFC and WTA though they will be trivial in the overall scheme of things.
- Aviva costs will then rise approx £20m in 2017/18 but other than that there is nothing else significant pre 2018/19 when there will of course be a new CL rights round.
Contributing to the revenue growth is TV subscriber growth (ie BT TV platform) which continues to be very strong - 59k vs 60k in the same quarter in the prior year. There are now over 1.6 million BT TV subscribers - up 61% over the last 2 years (
slide 9/13):
June 2016 - 1,620k
June 2015 - 1,202k
June 2014 - 1,007k
One other bit of information - programme rights costs are shown on
slide 11/13:
3 months to June 2016 - £163m
12 months to March 2016 - £544m
Notice the step up in the Sept 2015 quarter (obviously due to CL) but then they remain almost exactly flat quarter on quarter - implying football costs are being amortised on a 12 month straight line basis - not just over the football season.
http://www.btplc.com/Sharesandperfor.../Q116-KPIs.pdf