Reuters: Hot Stocks: UPDATE 2-BT shares hit 5-1/2 yr high after results top forecasts

Reuters: Hot Stocks Reuters.com is your source for breaking news, business, financial and investing news, including personal finance and stocks. Reuters is the leading global provider of news, financial information and technology solutions to the world's media, financial institutions, businesses and individuals. // via fulltextrssfeed.com

UPDATE 2-BT shares hit 5-1/2 yr high after results top forecasts May 10th 2013, 09:17 Fri May 10, 2013 5:17am EDT * FY rev down 5 pct at 18.25 bln stg vs consensus 18.1 blg * FY adj EBITDA up 2 pct at 6.2 bln stg vs consensus 6.1 bln * Expects 2014/15 EBITDA to rise to 6.2-6.3 bln * Ups FY div 14 pct to 9.5p, plans 300 mln stg buyback * Shares up 9 percent, hit 5-1/2 yr high (Rewrites first paragraph, adds reaction, shares, writes through) By Kate Holton LONDON, May 10 (Reuters) - Britain's BT underlined its return to form ahead of its pending pay-TV battle with BSkyB , raising its outlook after improvements across the board helped it beat forecasts and send its shares soaring. The former state telecoms monopoly, which was brought low in 2008 by a series of profit warnings, posted full-year results ahead of consensus and showed for the first time it could be close to returning to overall revenue growth. The results showed the benefits of the tough cost controls imposed by Chief Executive Ian Livingston, which enabled him to steer the group through the economic downturn by raising profits and increasing the dividend while still investing in a superfast network. BT's surprise move to offer free English Premier League soccer to customers, announced on Thursday in a direct challenge to BSkyB, fits with the next part of Livingston's strategy to persuade customers to sign up to the new fibre network. "We are doing what we said we would do," Livingston said. "In an environment where it is easier to focus only on the short-term, we are investing in our future and delivering growth in profits and dividends. "We have a lot more to do but we are now a lot better positioned to do it." Shares in the group were up 8.9 percent by 0840 GMT, topping the FTSE 100 gainers list and adding to the 26 percent rise in the stock recorded in the last year. The stock hit its highest in some 5-1/2 years. "Revenues were flat this quarter and that's certainly a step in the right direction," Livingston told reporters. "We expect to carry on growing our profits, carry on growing our dividend and carry on growing our cash flow, and return this business to revenue growth. That remains our aim." STRONG DEMAND BT, which competes with Virgin Media and TalkTalk as well BSkyB in the provision of broadband, telephony and pay-TV, posted full-year results showing earnings, profits and cash flow all up strongly and above forecasts. Full-year revenue was down 5 pct at 18.25 billion pounds against a consensus forecast of 18.1 billion, while adjusted EBITDA or core profit was up 2 pct at 6.2 billion against a forecast 6.1 billion. That was despite revenue for the year through March being down 5 percent, or 3 percent on an underlying basis. In the fourth quarter, revenue was steady on an underlying basis compared with the year before. The group benefited from strong demand for broadband and its new superfast fibre network, which is being sold to around 1.3 million customers. The strong operating performance enabled the group to raise its full-year dividend by 14 percent to 9-1/2 pence per share and announce a share buyback programme of 300 million pounds for this financial year and next. It also nudged its outlook higher, with free cashflow now forecast at 2.6 billion pounds in 2014/15, compared with an earlier forecast of 2.5 billion. "BT has hit a sweet spot," said Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers. "Prospects for the company look extremely attractive. In addition ... the company has underlined its confidence in providing earnings visibility two years out." The group is betting that part of its future growth will come from its new strategy of selling pay-TV, including Premier League soccer, to customers in a bid to persuade them to sign up and stay with its superfast broadband. It also announced aggressive pricing plans on Thursday, including giving its existing broadband customers the sports channels for free, which sent shares in rivals BSkyB and TalkTalk tumbling. ($1 = 0.6453 British pounds) (Editing by Christine Murray and David Holmes) Link this Share this Digg this Email Reprints

You are receiving this email because you subscribed to this feed at blogtrottr.com. If you no longer wish to receive these emails, you can unsubscribe from this feed, or manage all your subscriptions