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BT is set to release its 2023 financial results release on Thursday
Investors have bet £300 million against BT this week, as the company continues to battle against its declining share price.
Banks including BlackRock, Canada Pension Plan Investment Board and hedge funds such as AKO Capital and Kintbury Capital have bet against the company, according to a report from the Financial Times.
BT will release its 2023 annual results on Thursday, in which profits are expected to be just shy of £8 billion, according to analysts.
In total, 2.79% of the company’s shares are being shorted, representing the largest bet against BT since records began in 2012, according to figures from Breakout Point. This makes BT the sixth most shorted company in the FTSE100, behind major companies such as Ocado, Sainsbury’s and Rightmove. It is also notably far higher than other European telcos, such as Orange, Telefonica, Deutsche Telekom, Vodafone or Telecom Italia, which have an average short position of around 0.95%, according to the Financial Times report.
In December, Kintbury Capital founder Chris Dale said that it was taking a short position on BT, saying the operator had “no growth” and increasing debt. BT responded saying the company is “confident that we can support our progressive dividend and that we will see a material uplift in our cash flow once our peak full fibre build is completed in December 2026.”
BT’s debt pile sits at just under £20 billion. This, combined with high capital expenditure and increased competition from Vodafone, Three, and fibre altnets, has seen BT’s share price fall 29% in the last year.
“Telecoms is a sector that has a lot of debt as a part of it,” Kester Mann, analyst at CCS Insight, told City A.M in December last year. “We’re seeing operators look to reduce that through a number of means.”
Perhaps the most significant cost-cutting measure being adopted is widespread job cuts. In May last year, the company announced that it will eliminate 55,000 jobs by 2030, shedding around 40% of its current workforce. Up to a fifth of these jobs will reportedly be replaced by AI, said then CEO Philip Jansen, who noted the move would make BT “a leaner business with a brighter future”.
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