BT GROUP (-) : FY26 conf call feedback

Research evidence excerpt

BT GROUP (-) : FY26 conf call feedback

EQUITIES

TELECOM OPERATORS

BT GROUP UNDERPERFORMPRICE* 231p  TARGET PRICE 180p (DOWNSIDE 22%)

FLASH NOTE

FY26 conf call feedback

21 MAY 2026 Securities Research Report Production time: 11:51* (London time)

Research Analyst & Publishing Entities

Joshua Mills, CFA BNP Paribas London Branch (+44) 203 430 8670 Joshua.Mills@uk.bnpparibas.com

What happened?

The BT FY26 results presentation has just concluded with shares now c-2.5% (our results first take here). See below

for our 3x key takeaways:

1. FCF guidance: BT reiterated the FY27 and FY30 guidance with similar building blocks as before, namely

sustained EBITDA growth and lower capex offset by higher tax and interest. For FY27 specifically, the company

expect to benefit from £100m of forward sale of copper, and another £100m from handset factoring - seen by a

few this morning as a small negative. On the other side, BT reiterated that restructuring costs (below normalised

FCF) should fall from >£400m in FY26 to ~£200m in FY27/28 and ~£100m thereafter. This would be positive if

delivered, but we would remain cautious for now given the industry-wide track record of higher-than-expected

restructuring costs.

2. Competitive outlook and altnet expectations: BT believe that retail altnet competition is reducing, highlighting

that altnet build rates are -40% YoY. However, the overall consumer market remains competitive, with both

broadband and postpaid ARPUs -1% this year. BT commented that their focus has been on returning the customer

base to growth, and we expect this to remain a focus going forward (suggesting that some discounting may

continue). Whilst our recent pricing tracker analysis suggests some improvement in broadband price trends, front