The telecoms giant reported EBITDA of £7.9bn for the past year and said it expected to get back to that level through sales of 'converged' and 'growth' products and its ongoing cost-saving programme, which would also support its investment in broadband and mobile and the plan to reinstate its cancelled dividend by the year to March 2022.
In the half-year to September 30, revenue dropped 8% to £10.6bn due to the impact of COVID-19, including reduced revenue for BT Sport and a reduction in activity from its business customers.
Adjusted EBITDA for the past six months shrank 5% to £3.2bn, driven by the fall in revenue and partly offset by sports rights rebates and savings from the modernisation programme, leading to a 20% decline in reported before tax to £1bn.
The modernisation programme delivered £352mln gross annualised savings at a cost of £163mln.
BT's fibre rollout also reached record levels in the quarter to September 30, with a run rate of 40,000 premises per week, having passed 3.5mln premises to date.
The consumer customer base for fibre jumped 60% compared to last year, with fixed and mobile convergence at 21.4%.
Its 5G-ready customer base is now over 1mln people across 112 towns and cities, the FTSE 100 firm said.
Capital expenditure in the period rose 5% to £1.9bn to support fixed and mobile network investment.
Market welcomes the news
"Openreach is the jewel in the crown for BT, with a valuation estimated to be well in excess of BT’s own market cap," said Michael Hewson at CMC Markets.
"Today’s first-half numbers are encouraging in the context of BT’s performance in one of its major markets after the company earned more revenue than expected in the second quarter."
According to the analyst, this reinforces Openreach's potential for growth as well as the challenges of financing BT's goals, while competing with Telefonica and Liberty Global in the quad-play space of home phone, broadband, TV and mobile contracts into a one size fits all package.
Shares shot up 6% to 108.1p on Thursday morning.
--Adds analyst comment, shares--