BT Group: Expected Weak Start to the Year in Consumer Segment Results in 1% EBITDA Growth

BT Group trading update was slightly worse than expected in our view, although still in line with management's outlook for the full year. Overall revenue declined by 2% to GBP 5.05 billion, mainly dragged by the consumer segment, which saw a 1% sales decline compared with the healthy 4% growth seen in fiscal year 2024. This, however, was expected by management, which three months ago commented that consumer revenue growth should be stronger in the second half of the year. As such, we are not overly worried about this weakness. Competition from mobile-virtual-network-operators seems to have picked up slightly, with Tesco Mobile adding 200,000 mobile clients last year, for instance. The group's EBITDA grew by 1% to GBP 2.03 billion, mainly supported by Openreach. Management has maintained its 2025 yearly outlook. We are maintaining our GBX 200 fair value estimate.