Telecoms giant BT's profits soar thanks to inflation-linked contracts

It put the rise down to increased revenue, which had been helped by its inflation-linked contracts with customers, and controlling costs, among other things.

Shares rose around 6% shortly after markets opened on Thursday.

The company said it connected a record 860,000 premises to the UK’s full-fibre broadband network during the six months.

It added that average revenue per Openreach broadband user rose 10% due to price rises and more connections.

The business said it has managed to cut annual costs by £2.5 billion since April 2020, against its target of £3 billion by 2025. It has cost it £1.3 billion to do so.

Outgoing chief executive Philip Jansen said: “These results show that BT Group is delivering and on target. We’re rapidly building and connecting customers to our next-generation networks, we’re simplifying our products and services, and we’re now seeing predictable and consistent revenue growth.

“Openreach has now built full fibre broadband to more than a third of the UK’s homes and businesses with a growing connection rate.”

Mr Jansen is set to hand over to Allison Kirkby, a Briton who currently heads Swedish telecoms giant Telia.

He added: “BT Group has a bright future and I’m pleased to be handing the baton to Allison Kirkby early in the new year.

“She knows the sector, she knows the company and she’s the right person to lead BT Group from this position of operational strength.”

Matt Britzman, equity analyst at Hargreaves Lansdown, said BT has been helped by the launch of “new EE”, a rebrand of some of the company’s consumer-facing products.