Fixed-Line Service Provider BT Group’s Restructuring Plan Witnessed Rejection From Its Union

BT group Plc

BT Group plc (BT) is a telecommunications services company that offers voice and data services. The company’s services portfolio comprises of managed network IT services, fixed voice and data, mobility, television, connectivity, and broadband services. It also offers copper and fibre connections between exchanges, homes and businesses.

BT caters to large corporate firms, small and medium-sized enterprises, start-ups, wholesale customers, commercial premises, homes, and public sector organisations. It offers its services under the brand names: BT, Openreach, PlusNet and EE. The company has a business presence across Asia-Pacific, Europe, the Middle-East, Africa and the Americas. Around 83 per cent of the group’s total revenue comes from the UK, as per the FY18 annual report.  [optin-monster-shortcode id=”wxhmli4jjedneglg1trq”]

On April 02, 2019, the fixed-line service provider witnessed significant rejection for its restructuring plan from its union representing its workers, and they argued that the company’s restructuring plan would impose “extreme culture change” on the workforce.

National secretary of BT union, Noel McClean said that the defeat of vote by the members of the BT group gives clear indication to the CEO Philip Jansen that he is not considering BT’s current staffs in his potential vision for BT Group. The ballot came after news that the company is planning to reduce its labour pool dramatically to 75k level from the current strength of 105.80k.

The Group was miffed because of ballot result but not surprised and will continue to pursue with the Union on implementing the decided plan.

BT has strong R&D capabilities that helps it to improve the performance of existing products and develop new products and services in the areas of 5G, FTTP, IoT and cybersecurity. In FY2018, the company’s R&D initiatives included converged network development, application of AI and big-data, connected entertainment, connected world, and cybersecurity. Its R&D focuses on implementing new ideas such as generating 3D Printed Cab Needle to add new circuits in the roadside cabinet, and a Flexi Drill to clear blockages in the underground duct network. It performs co-innovations with start-ups through BT Infinity Lab.

The company implemented various strategic initiatives that are aimed at enhancing its business operations. In September 2018, the company secured a five-year NHS contract to offer Health and Social Care Network (HSCN) services for the South East of England. In the same month, BT extended its contract with UKTV to deliver enhanced video-on-demand (VoD) services for BT TV customer.

Stock Performance – 1 year

eket(Source: Thomson Reuters)

At the time of writing (as on April 03, 2019 at 10:38 AM GMT) before the market close, shares of BT Group were quoting at GBX 225.45 and added 1.50 points or 0.67% against its previous day close. Shares have registered a 52w high of GBX 268.60 and a 52w low of 201.25. At the current price level shares were trading 11.30 per cent above its 52w low price level. Shares of BT Group were trading above its 30-day simple moving average and were up by around 5% on a monthly basis. Total outstanding market capitalisation was around £22.36 billion and dividend yield was 6.70 per cent.