BT 2009 Annual Report Download - page 36

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ADDITIONAL INFORMATION FINANCIAL STATEMENTS REPORT OF THE DIRECTORS BUSINESS AND FINANCIAL REVIEWS OVERVIEW
34 BT GROUP PLC ANNUAL REPORT & FORM 20-F
BUSINESS AND FINANCIAL REVIEWS FINANCIAL REVIEW
from networked IT services and MPLS. Broadband and convergence
revenue increased by 3% to £2,637m due to an increase in business
mobility volumes and revenue from BT Vision. In 2008, broadband
and convergence revenue increased by 11%, driven by growth in
revenue from consumer broadband. These increases were partially
offset by an 8% decrease in revenue from calls and lines to
£6,305m, compared with a decline of 4% in 2008. The acceleration
of the decline in 2009 reflects the increasingly competitive
environment and further market declines. Revenue from transit,
conveyance, interconnect circuits, WLR, global carrier and other
wholesale products decreased by 3% to £3,301m, compared with a
decrease of 2% in 2008 as a result of the continued decline in low
margin transit revenue and conveyance volumes.
Customer segment revenue
Customer segment Source of revenue
Major corporate BT Global Services’ major corporate customers
Business BT Retail’s SME customers
Consumer BT Retail’s consumer customers
Wholesale/carrier Openreach’s external customers,
BT Wholesale’s external customers and
BT Global Services’ global carrier customers
The group also analyses revenue by customer segment. The table
above indicates the source of revenue for each of the customer
segments and how this relates to the different lines of business.
2009 2008 2007
£m £m £m
Revenue by customer segment
Major corporate 8,463 7,573 7,089
Business 2,631 2,590 2,456
Consumer 4,850 5,071 5,124
Wholesale/carrier 5,404 5,442 5,537
Other 42 28 17
Group total 21,390 20,704 20,223
Major corporate
Major corporate revenue increased by 12% to £8,463m (2008:
£7,573m, 2007: £7,089m), compared with an increase of 7% in
2008. The increase in 2009 primarily reflects the favourable impact
of foreign exchange movements and recent acquisitions. BT Global
Services, which serves major corporate customers, achieved total
contract wins of £8.0bn in 2009 (2008: £8.0bn, 2007: £9.3bn).
Business
Business revenue increased by 2% to £2,631m in 2009 (2008:
£2,590m, 2007: £2,456m), compared with growth of 5% in 2008.
The increase is due to growth in mobility and convergence revenue
and networked IT services revenue. The significant growth in the
prior year was due to the acquisitions of Basilica and Lynx
Technology.
Consumer
Consumer revenue decreased by 4% to £4,850m in 2009 (2008:
£5,071m, 2007: £5,124m), compared with a decrease of 1% in
2008, due to a decline in revenue from calls and lines, which was
partially offset by growth in mobility and convergence revenue.
Residential broadband connections increased by 9% to 3.6m at
31 March 2009. At 31 March 2009, we had 14m call package
customers (2008: 15m). The proportion of our consumer revenue
under contract was 71% in 2009, compared with 70% in 2008 and
68% in 2007.
The 12 month rolling average annual revenue per consumer
household (ARPU), net of mobile termination charges, was £287 in
2009 (2008: £274, 2007: £262), a year on year increase of 5% in
both 2009 and 2008. The increase to consumer ARPU reflects the
higher number of customers buying multiple services from BT,
together with the successful retention of higher value customers.
Major corporate
40%
Wholesale/carrier
25%
Consumer
23%
Business
12%
Revenue by customer segment – year ended 31 March 2009 (%)
Line of business results
Contract and financial review
Revenue Operating profit (loss)acharges and specific items
2009 2008 2007 2009 2008 2007 2009 2008 2007
£m £m £m £m £m £m £m £m £m
BT Global Services 8,828 7,889 7,312 (2,106) 117 70 1,639 – –
BT Retail 8,471 8,477 8,346 1,209 1,050 912
BT Wholesale 4,658 4,959 5,386 580 502 592
Openreach 5,231 5,266 5,223 1,218 1,222 1,220
Other 42 28 17 (490) (535) (253) 408c539c172c
Intra-group (5,840) (5,915) (6,061)
Group totals 21,390 20,704 20,223 411 2,356 2,541 2,047 539 172
aA reconciliation from total operating profit (loss) to (loss) profit after tax is given on page 32.
bItems presented as ‘adjusted’ are stated before contract and financial review charges recorded within BT Global Services and specific items.
cSpecific items for all years presented.
BUSINESS AND FINANCIAL REVIEWS