BT to post Q3 results amid Openreach battle with Ofcom
The regulator warned in November that it would trigger formal proceedings with the European Commission to order a legal separation of Openreach after it said BT’s plans to appease competition concerns fell short.
Openreach develops and maintains the UK’s main telecoms network used by telephone and broadband providers such as Sky, TalkTalk, Vodafone and BT Consumer.
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Hide AdBut Ofcom stopped short of forcing a full break-up and sale of Openreach and added it remained ‘’open’’ to further proposals from BT for a voluntary separation of the division.
There is unlikely to be any update on the talks with Ofcom in BT’s quarterly results on Friday, but analysts said it would continue to be a headache for the group until it is resolved.
HSBC’s telecoms experts said: “We expect that 2017 will provide a conclusion, resolving an overhang for the stock.
“Most likely, in our view, is for BT and Ofcom to reach a compromise within the first half of the year.”
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Hide AdBT chairman Sir Mike Rake told the Press Association earlier this month the group was “hopeful to reach a solution”.
The firm’s third-quarter update is expected to show underlying pre-tax profits nudging up to £930 million from £928 million a year earlier and a further boost to customer numbers from its acquisition of mobile phone company EE last year.
It comes after better-than-expected second-quarter earnings, when it added 63,000 new customers, with EE numbers rising by 280,000.
HSBC analysts added: “We continue to expect strong operational performance.”