BT 2015 Annual Report Download - page 77

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Overview
The Strategic Report
Purpose and strategy Delivering our strategy 0ur lines of business
Group performance Governance Financial statements Additional information
Transform our costs
peratin costs reduced  011 1 as cost eciencies oset
an increase in volues pa ination and the additional enineerin
resource we recruited.
e have increased our ecienc b proactive investent in process
iproveents and new sstes and tools that will reduce the nuber
of enineerin obs and unnecessar custoer contacts. e have
recruited additional enineers usin new ters and conditions which
oer reater operational eibilit. here possible we have also
proressed insourcin activities.
his ear we
 created innovative apps that iprove enineer ecienc and
havea direct ipact on our costs. hese apps also ive us better data
about enineer visits and direct feedbac fro custoers which
should help reduce custoer coplaints and avoid repeat visits
 trialled the iew  nineer app which allows s and end
custoers to see the enineers proress towards their ob.
teans the can contact the enineer if the need to chane
the appointent avoidin wasted visits and costs and custoer
dissatisfaction and
 invested in proactive aintenance of our copper networ to reduce
faults in e trouble hotspots savin enineer interventions.
eprevented ore than 100000 faults durin the ear thans to
iproved taretin and increasin our financial investent b 10.
his helped stabilise our networ althouh we were also helped b
the inder weather.
nvest for rowth
ur plans to invest over bn in fibre broadband infrastructure
is a critical part of our investent for rowth but we now we
ust continue to innovate to eet custoers chanin needs.
eannounced lare-scale trials this suer of ultrafast broadband
with .fast technolo see below.
ince we launched our superfast prorae we have introduced
nearl 0 innovations and iproveents as we continuall tr to
epand the reach of our networ or ae it easier to build.
e also invested in our copper networ which rew b 1000
lines this ear and continues to underpin the services we provide.
nd we continue to develop our thernet portfolio and oer
copetitive pricin.
Ultrafast broadband vision
n anuar 01 we set out our ultrafast broadband vision for the UK.
Usin .fast technolo we epect to oer initial speeds of a few
hundred eabits per second to illions of hoes and businesses b
00. peeds are epected to increase to up to 00bps to ost of
the UK within a decade fro now as further industr standards are
secured and new it is developed subect to there continuin to be
a stable reulator environent that supports investent. e also
plan to oer a 1bps product for those who want ever faster speeds.
.fast is an innovative technolo that uses hiher freuencies than
 to provide faster broadband speeds over copper. e will test
it in two trial locations untindon abrideshire and osforth
ewcastle this suer.
he trials will build on tests at our innovation centre at dastral ar.
hese have shown that .fast has the potential to deliver sinificant
speed increases fro eistin and new fibre street cabinets as well
as fro other points closer to the custoer. his is an iportant
developent as it eans the technolo can be deploed in a ore
ecient and rapid anner than previousl thouht.
f the trials are successful we will start to deplo .fast across the
networ in the 011 financial ear.
Financial performance
ear ended 1 arch
2015

01

01

evenue 011 01 11
Operating costs 11 0 
 00 01 
Depreciation and amortisation 1 10 1
peratin profit 1 119 11
apital ependiture 10 109 11
peratin cash ow 10 19 1
evenue declined 1 011 1. eulator price chanes had
a neative ipact of around 10 the euivalent of around  of
our revenue. his was partl oset b 1 rowth in fibre broadband
revenue due to stron aret deand.
evenue fro fibre broadband accounted for 10 of total revenue this
ear copared to  last ear.
peratin costs reduced  011 1. ost eciencies fro
iprovin enineer ecienc and reducin the nuber of tass and
custoer contacts were partl oset b a saller benefit fro the sale
of redundant copper. n the ear the sale of redundant copper enerated
net incoe of 9 and we epect no benefit fro this in 011.
 was at 011  down and with depreciation and
aortisation down  011  driven b a lower depreciation
chare on core networ assets operatin profit was up  011
 decrease.
apital ependiture of 10 increased  or  011
9 or  decrease driven b hiher volues of thernet provision
the epansion of our networ to new hoes and an increase in UK
fibre rollout. apital ependiture is net of  rant fundin
011 1.
peratin cash ow increased 1 011 1.
Key priorities
ur future plans include
 continuin to iprove our custoer service throuh onoin
investent and innovation
 proressin our .fast trials and continuin to roll out fibre in UK
and hard-to-reach areas and
 reshapin penreach around our custoers to be read for their
future needs.