BT shares sink after dividend axed

Bosses said the 'exceptionally difficult' decision was necessary to keep funding an upgrade of the telecoms giant's broadband network as it takes a financial hit from the coronavirus pandemic. Chief executive Philip Jansen said the company now aims to offer fibre to 4.5m homes and businesses by next March and 20m by the mid to late-2020s, up from a previous target of 15m. Along with investment in 5G mobile services, the vast programme will cost BT about £12billion over the next decade – but Jansen is betting the huge spending will lead to bigger profits in the future. He said the Covid-19 crisis, which has sparked a surge in the use of mobile phones and home internet, showed that upgrading the UK's broadband network was 'a matter of extreme urgency'. In a further blow to investors, BT said it will make no dividend payments for the current 2020-21 financial year and that when they resume in 2021-22 the pay outs will be worth just 7.7p per share annually – or about £761million.