LONDON, June 27, 2026, 21:04 BST
- BT Group closed Friday at 195.00p, up 1.64% on the day but down 0.4% from the previous Friday’s close.
- A June 19 company-compiled consensus puts FY27 normalised free cash flow at about £2.0 billion, but post-pension-deficit-payment free cash flow at negative £52 million on a mean basis.
- Next week’s triennial pension valuation is the near-term cash event after the scheme wrote down its Thames Water equity stake by about £300 million.
Because June 27 is a Saturday, the latest trade for BT Group plc (LON:BT.A) is Friday’s London close. The shares ended at 195.00p on June 26, up 3.15p, or 1.64%, while the FTSE 100 (INDEXFTSE:UKX) finished at 10,508.02, down 21.87 points. BT was still down 0.4% for the week from 195.70p on June 19.
The narrow weekly move hides a weaker month. BT is down 6.6% from its May 29 close of 208.80p. Friday volume was 27.7 million shares, less than half the 57.0 million traded on June 19. The stock sits about 19% below its 52-week high of 242.00p and 13% above its 173.00p low. At Friday’s price, the market value was £19.21 billion.
The cleaner trade on BT is no longer just whether Openreach can cut line losses. It is whether the cash promised from lower fibre spending reaches shareholders after pension payments.
BT’s own June 19 consensus table shows why. Analysts put FY27 normalised free cash flow at £2.0 billion on a mean basis. The same cash-flow table shows equity dividends paid of £825 million, gross pension deficit payments of £784 million and free cash flow after pension deficit payments at negative £52 million, with the median just £19 million.
That makes the next pension update a share-price event. The dividend yield quoted by AJ Bell was 4.26% on Friday, and BT has told investors it plans to grow the dividend by a low-to-mid single-digit percentage from FY27 while keeping credit metrics in line with a BBB+ rating.
Chief Executive Allison Kirkby said with May’s full-year results that BT had delivered “cash flow inflection to c. £2.0bn in FY27”. The company also reported a gross IAS 19 pension deficit of £4.2 billion at March 31, up from £4.1 billion a year earlier. Investegate
Pension risk moved back into view this week after the BT scheme lost about £300 million on Thames Water. Shan Abdullah, who leads BT’s pensions risk team, said the equity stake had been “written down” by about £300 million, while the scheme had sold its Thames Water debt exposure before another write-down was needed. The Guardian
The £300 million is not large against the scheme’s £33.2 billion asset base. It is more sensitive because BT is due to announce its triennial pension valuation next week, setting out payments for the next three years to fund about 213,600 retired employees. The scheme pays £2.9 billion in benefits each year.
The operating case is still there. BT said Openreach passed 4.8 million premises with full fibre in FY26, taking its footprint to 23 million premises, and added 2.2 million net FTTP connections. Openreach broadband line losses were 825,000 for the year, better than BT’s guidance of about 850,000, and BT expects about 800,000 losses in FY27.
The revenue line is the drag. Reported revenue fell 3% to £19.7 billion in FY26, adjusted revenue fell 4%, adjusted EBITDA was flat at £8.2 billion and net debt stood at £20.0 billion. Capital expenditure was £5.1 billion, and BT guides for capex excluding spectrum to fall to about £4.3 billion in FY27.
For the week ahead, the pension valuation is the number to watch. A lower contribution path would leave more of the £2.0 billion FY27 cash-flow target for debt reduction and dividends. A tougher schedule would keep the stock pinned closer to a pension-funded utility trade than a fibre cash-flow recovery.
