BT's shares slipped on the back of these figures, despite having announced plans to raise the dividend by 10-15 per cent for the next three years and the commencement in 2013 of a £300m share buy-back programme. Something closer to a 20 per cent dividend hike had been expected. Still, the yield remains attractive and BT is delivering on its operational metrics - so investors should stay connected to BT.
The group has been especially busy bolstering its broadband offering and has made fibre optic broadband available to 10m homes - allowing BT to grab a 54 per cent share of all broadband net new additions in 2011. Combined with further traction in BT Vision - which grew subscriptions 23 per cent to 700,000 homes - and BT Retail's operating profit increased 6 per cent to £1.4bn. BT's global services business is improving, too, with order in-take there having risen 8 per cent in the final quarter to £2bn - despite an 8 per cent slide for the year as a whole. Ongoing cost-cutting has helped divisional operating losses to narrow to £85m, from £141m, and management expect solid earnings growth in 2013.