BT Group plcAnnual General Meeting
19 July 2007
Sir Christopher Bland - Chairman
Group revenue £20.2bnGroup revenue £20.2bn
Earnings per share (1) 22.7pEarnings per share (1) 22.7p
Full year dividend 15.1p Full year dividend 15.1p
EBITDA (1) £5.6bnEBITDA (1) £5.6bn
(1) Before specific items
FY 2006/7
16%
2%
4%
27%
BT Group – Financial headlines
UKGAAP, April 2001 – March 2004, before exceptional items and goodwill from continuing activitiesIFRS, April 2004 – March 2007, before specific items
0
4
8
12
16
20
24
2001/2 2002/3 2003/4 2004/5 2005/6 2006/7
EPS 22.7p up 16%pence
EPS – Five years of continuous growth
Dividends
• Two thirds payout ratio reached one year early
• Expect to increase dividends, taking into account our earnings growth, cash generation and our ongoing investment needs
Share buy back
• New £2.5bn programme
- expected completion March 2009
Distribution policy
Returned £4.8bn in dividends and share buyback over the last 5 yearsReturned £4.8bn in dividends and share buyback over the last 5 years
0
2
4
6
8
10
12
14
16
2001/2 2002/3 2003/4 2004/5 2005/6 2006/7
pence Dividend 15.1p up 27%
90
100
110
120
130
140
150
Jul-0
6
Aug
-06
Sep
-06
Oct
-06
Nov
-06
Dec
-06
Jan-
07
Feb
-07
Mar
-07
Apr
-07
May
-07
Jun-
07
Jul-0
7
BT FTSE100
BT Share price231.75p on 14/07/06
BT Share price334.25p on 16/07/07
44%
17%
Share price
22 Mar ’01
26 Mar ‘01 27 Mar ‘01 23 Mar ‘01
20 Mar ‘01 23 Mar ‘01
BT Group – 2001 headlines
BT fights to tame £30bn
debt
BT’s wrong numbersBloomin’ TerribleBT turmoil as
shares slump 66% in a year
BT at the end of the
line
BT buried in debt
Company seeks to refinance loans
BT poised for cash call
dash
My original checklist
– Improved service– Price innovation– Reduce costs /
improve margin– Aggressive & creative
marketing
– NetworkedIT services
– Broadband– Mobility
Long term Partnership
with our customers
... Consistent delivery
Defend traditional
Grow new wave
BT Group strategy
21st Century Network
• Broadband – 11m connections and over 99% coverage
• Networked IT services - £4.4 billion annual revenue
• Global capability in over 170 countries
• Broadband – 11m connections and over 99% coverage
• Networked IT services - £4.4 billion annual revenue
• Global capability in over 170 countries
Strategy in action
• BT Vision – multi-channel TV with no compulsory subscription
• 21st century network – leading the world in building a broadband IP network for all
• Transformation into a leading service provider
• BT Vision – multi-channel TV with no compulsory subscription
• 21st century network – leading the world in building a broadband IP network for all
• Transformation into a leading service provider
Delivering today Delivering tomorrow
The way we work
BT made Company of the Year by Business in
the Community
Open, constructive relationship
with the regulator
BT made Company of the Year by Business in
the Community
Open, constructive relationship
with the regulator
Board changes
Board changes
Board changes
Board changes
Board changes
Board changes
Board changes
Board changes
Board changes
18 May ‘07
18 May ‘07
17 Dec ‘06 21 Dec ‘06
Internet King BT to return £2.5 billion
18 May ‘07
BT Group 2006/7 headlines
18 May ‘07
Bland leaves BTset to reach for the sky
BT regains top spot in broadband
A Perfect Day BT BonanzaMagic £3 mark
Sir Christopher Bland - Chairman
Bringing it all togetherAnnual General Meeting
19 July 2007
Ben VerwaayenChief Executive
– Improved service– Price innovation– Reduce costs /
improve margin– Aggressive & creative
marketing
– NetworkedIT services
– Broadband– Mobility
Long term Partnership
with our customers
... Consistent delivery
Defend traditional
Grow new wave
BT Group strategy
21st Century Network
£bn
+ 17%
- 3%
FY 2006/7 – Revenue UP 4%
6.3 7.4
12.813.2
30% CAGR in 4 years30% CAGR in 4 years£bn
+ 20%+ 20%
+ 71%+ 71%
+ 44%+ 44%
CAGR
Revenue – New wave driving transformation
Mobility & Other
Networked IT Services
Broadband
Signed 858 new customers
BT Global Services – 2006/7 order intake
£9.3bn
WholesaleRetail
The UK’s number 1 broadband retailerby market share
ISP of the yearMac Magazine 2006 Awards
Most trusted ISP 2007Reader’s Digest
> 10.7 million connections at 31/3/07
0
1
2
3
4
5
6
7
8
9
10
11
2004 2005 2006 2007
LLU
Other ISP’s
Retail *
Mar-04 Mar-05 Mar-06 Mar-07
Mn
Broadband
Home IT advisor- 40,000 users
VoIP- 1.4m registered users
BT Digital Vault- 125,000 users
Home hubs- Over 1 million
BT Vision- National marketing campaign
under way
BT Total Broadband
• Corporates– Networked IT services– Local service, global delivery– Expanded portfolio of capabilities
• Consumer– BT Together– BT Total Broadband– BT Fusion & BT Vision
• Business– BT Business One Plan– BT IT Manager– BT Office Anywhere
• Other operators- Managed Service- Broadband- Local access for telephony and broadband
SimplerHigher quality
More efficientFaster
Delivering Value for our customers
From traditional telco…
… to leading services provider with global capabilities
Real time
Open
Global
Keys to ourtransformation
• To improve– Customer service– Efficiency– Free cash flow
• To deliver– Right first time service– Where our customers are– A simplified organisation
• To reduce– Complexity– Cost base– Time to market
• To enable
– Customer to focus on what they do best
– Software solutions– Global delivery and reach
Transformation to Service Provider
* Before specific items and leavers
Bringing it all together
• Strategy built around convergence & innovation
– 17% growth in new wave revenues
• Corporate transformation
– From traditional telco to leading services provider with global capabilities
• Strong momentum with track record of delivery
– Twenty quarters of EPS growth
– Thirteen quarters of revenue growth
– Five quarters of EBITDA growth
• Continue to grow revenue, EBITDA*, EPS*and dividends in 2007/8
BT Group plcAnnual General Meeting
19 July 2007
Against
Vote Withheld
For
Proxy Votes
Resolution 1
Reports and accounts
4,690,961,416
7,879,073
1,540,670
Against
Vote Withheld
For
Proxy Votes
Resolution 2
Directors’ remuneration report
3,039,747,846
130,725,306
1,529,908,007
Against
Vote Withheld
For
Proxy Votes
Resolution 3
Final Dividend
4,698,432,613
678,005
1,270,541
Against
Vote Withheld
For
Proxy Votes
Resolution 4
Re-elect Sir Christopher Bland
4,665,303,524
32,179,017
2,898,618
Against
Vote Withheld
For
Proxy Votes
Resolution 5
Re-elect Andy Green
4,676,367,376
18,232,668
5,781,115
Against
Vote Withheld
For
Proxy Votes
Resolution 6
Re-elect Ian Livingston
4,678,250,916
19,041,422
3,088,821
Against
Vote Withheld
For
Proxy Votes
Resolution 7
Re-elect John Nelson
4,685,502,100
11,541,397
3,337,662
Against
Vote Withheld
For
Proxy Votes
Resolution 8
Elect Deborah Lathen
4,683,490,802
12,907,229
3,983,128
Against
Vote Withheld
For
Proxy Votes
Resolution 9
Elect François Barrault
4,684,502,467
11,963,701
3,914,991
Against
Vote Withheld
For
Proxy Votes
Resolution 10
Reappointment of auditors
4,679,050,873
7,394,391
13,935,895
Against
Vote Withheld
For
Proxy Votes
Resolution 11
Remuneration of auditors
4,678,136,507
7,977.341
14,267,311
Against
Vote Withheld
For
Proxy Votes
Resolution 12
Authority to allot shares
4,655,261,395
41,386,501
3,733,263
Against
Vote Withheld
For
Proxy Votes
Resolution 13
Authority to allot shares for cash**Special resolution
4,686,626,092
9,444,399
4,310,668
Against
Vote Withheld
For
Proxy Votes
Resolution 14
Authority to purchase own shares**Special resolution
4,609,658,522
6,594,827
84,127,810
Against
Vote Withheld
For
Proxy Votes
Resolution 15
Authority to use electronic communications**Special resolution
4,680,669,745
12,524,737
7,186,677
Against
Vote Withheld
For
Proxy Votes
Resolution 16
Authority for political donations
4,579,323,754
62,870,366
58,187,039
Poll on Resolution X
Using your Form of proxy/Admission card:• If voting all shares “for”, place a tick () in “For” box• If voting all shares “against”, place a tick () in “Against”
box• If voting all shares “vote withheld”, place a tick () in
“Vote withheld” box• If splitting vote, indicate the number of shares voting “for”
“against”and “vote withheld”
• Please sign the card• Place completed card in ballot box as you leave • Please ask a marshal if you have any questions
Poll on Amendment to Resolution X
Using your voting paper:
• If voting all shares “for” amendment, tick “For” box in Column 2, alongside appropriate resolution number
• If voting all shares “against” amendment, tick “Against” box in Column 3
• If splitting vote, enter the appropriate number of shares in Columns 2and 3
• Write name, address and account number in Box 1
• Sign the voting paper in Box 2 and hand it to marshal at end of row
• Please ask a marshal if you have any questions
Poll on Procedural Resolution X
Using your voting paper:
• Delete Box A
• If voting “for” procedural resolution, place a tick () in Box 1headed “For”
• If voting “against” procedural resolution, place a tick () in Box 2headed “Against”
• If splitting vote, enter the appropriate number of shares in Boxes 1 and 2
• Write name, address and account number in Box 3
• Sign the voting paper in Box 4 and hand it to marshal at end of row
• Please ask a marshal if you have any questions`
BT Group plcAnnual General Meeting
19 July 2007