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BT Group plc Annual Report & Form 20-F 2015 Investing for the future building on a history of 1846 1869 1892 1915 1938 1961 1984 2015 PC_FRONT.indb 3 5/15/2015 1:46:39 AM Our current innovations 30 years since privatisation ,QQRYDWLRQKDVEHHQDWWKHKHDUWRI%7VLQFH LWVIRUPDWLRQLQDQGVLQFHLWVVWRFN PDUNHWƮRWDWLRQLQ:HFRQVWDQWO\ VHDUFKIRUQHZZD\VWRLPSURYHRXU QHWZRUNVDQGVHUYLFHVVR{WKDW{RXUSHRSOH FDQKHOSRWKHUVWRUHDOLVH{QHZ{SRVVLELOLWLHV Inventing a smarter future 1984>2013 2014>15 2015> /HDGLQJWKHZD\LQGHYHORSLQJLQQRYDWLYH SURGXFWVDQGVHUYLFHVIRURXUFXVWRPHUVLV DELJSULRULW\IRUXV:HVKRZFDVHDQXPEHU RIFXUUHQWSURMHFWVZLWKWKHSRWHQWLDOWR PDNHOLIHHDVLHUIRUWKRVHZHVHUYH Read more on page 14 Read more on page 12 &RPLQJXSZLWKQHZLGHDVDQGGHYHORSLQJ QHZWHFKQRORJLHVLVLQRXU'1$:HKLJKOLJKW DIHZRIWKHDUHDVZHDUHIRFXVHGRQIRU WKHIXWXUHDQGKRZWKH\ UHGHVLJQHGWR SXVKWHFKQRORJ\IXUWKHUWKDQEHIRUH Our history of innovation $OOLQWHQGHGWRLPSURYHSHRSOHoVOLYHVLQ ,QWKLV\HDUoV$QQXDO5HSRUWZHDUHFHOHEUDWLQJRXUULFK 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7KLVLVWKH%7$QQXDO5HSRUWIRUWKH\HDUHQGHG0DUFK Contents ,W{FRPSOLHVZLWK8.UHJXODWLRQVDQGFRPSULVHVSDUW RIWKH$QQXDO5HSRUWDQG)RUP)IRUWKH866HFXULWLHV 2 &KDLUPDQoVLQWURGXFWLRQ DQG([FKDQJH&RPPLVVLRQWRPHHW86UHJXODWLRQV Overview 7KLVLVRXUƬUVWLQWHJUDWHG$QQXDO5HSRUW:HZDQWWR The Strategic Report FRPPXQLFDWHRXUVWRU\LQDPRUHFRPSHOOLQJZD\:HVHH Purpose and strategy ,QWHJUDWHG5HSRUWLQJ ,5 DVWKHEHVWZD\WRGRWKDW6RWKLV &KLHI([HFXWLYHoVLQWURGXFWLRQ \HDUIRUWKHƬUVWWLPHZHDUHUHƮHFWLQJWKLVDSSURDFKLQ 21 Our purpose 21 Our goal KRZZHVWUXFWXUHDQGSUHVHQWRXU$QQXDO5HSRUW 21 Our strategy ,QWHJUDWHG5HSRUWLQJLVDQLQLWLDWLYHOHGE\WKH,QWHUQDWLRQDO,QWHJUDWHG Delivering our strategy 5HSRUWLQJ&RXQFLO ,,5& :KLOH,5LVPDUNHWOHGLWVSULQFLSOHVDQG 2SHUDWLQJ&RPPLWWHH DLPVDUHFRQVLVWHQWZLWK8.UHJXODWRU\GHYHORSPHQWVLQƬQDQFLDODQG 2XUEXVLQHVVPRGHO FRUSRUDWHUHSRUWLQJ )LQDQFLDOVWUHQJWK 2XUSHRSOH ,Q'HFHPEHUWKH,,5&LVVXHGWKH,5)UDPHZRUNWRHVWDEOLVK 2XUQHWZRUNVDQGSK\VLFDODVVHWV guiding principles and content elements IRULQWHJUDWHGUHSRUWV:H{KDYH 5HVHDUFKDQGGHYHORSPHQW WDNHQWKHVHSULQFLSOHVDQGHOHPHQWVLQWRDFFRXQWLQSUHSDULQJRXU %UDQGDQGUHSXWDWLRQ $QQXDO5HSRUW7KLVLVPRVWREYLRXVLQWKHUHYLVHGUHSUHVHQWDWLRQRIRXU 6WDNHKROGHUVDQGUHODWLRQVKLSV EXVLQHVVPRGHODQGWKHQHZVHFWLRQGHVFULELQJRXUPDLQVWDNHKROGHUV 1DWXUDOUHVRXUFHV :HQRORQJHUUHSRUWVLPSOHnRXWSXWVoZHFRQVLGHUnRXWFRPHVoRU 2XUULVNV WKHLPSDFWWKDWZHKDYHDVDEXVLQHVV$QGZHXVHDVHWRIVL[LFRQV 51 ((DFTXLVLWLRQULVNV WKURXJKRXWWKLV$QQXDO5HSRUWWRSURYLGHOLQNDJHWRWKHEXVLQHVVPRGHO Our lines of business %XWWKLVLVMXVWWKHVWDUW:HUHFRJQLVHWKDWRXUPRYHWRZDUGnIXOOo,5 ZLOO{FRQWLQXHWRHYROYH)LQGRXWPRUHZZZWKHLLUFRUJ Group performance *URXS)LQDQFH'LUHFWRUoVLQWURGXFWLRQ *URXSSHUIRUPDQFH 'HOLYHULQJVRFLHWDODQGHQYLURQPHQWDOEHQHƬWV Governance &KDLUPDQoVJRYHUQDQFHUHSRUW +RZZHJRYHUQWKHJURXS %RDUGRI'LUHFWRUV 7KH%RDUG 5HSRUWVRIWKH%RDUGFRPPLWWHHV 'LUHFWRUVoLQIRUPDWLRQ Online Annual Report 'HOLYHULQJRXUSXUSRVHXSGDWH *HQHUDOLQIRUPDWLRQ ZZZEWFRPDQQXDOUHSRUW ZZZEWFRPGHOLYHULQJRXUSXUSRVH 6KDUHKROGHUVDQG$QQXDO*HQHUDO0HHWLQJ Financial statements $XGLWRUVoUHSRUWVsFRQVROLGDWHG{ƬQDQFLDO{VWDWHPHQWV &RQVROLGDWHGƬQDQFLDOVWDWHPHQWV 1RWHVWRWKHFRQVROLGDWHGƬQDQFLDOVWDWHPHQWV $XGLWRUVoUHSRUWsSDUHQWFRPSDQ\ƬQDQFLDO{VWDWHPHQWV )LQDQFLDOVWDWHPHQWVRI%7*URXSSOF 6XEVLGLDU\XQGHUWDNLQJV Additional information $OWHUQDWLYHSHUIRUPDQFHPHDVXUHV Please see the cautionary statement regarding forward-looking statements 6HOHFWHGƬQDQFLDOGDWD on page 209. )LQDQFLDODQGRSHUDWLRQDOVWDWLVWLFV The Purpose and strategy, Delivering our strategy, Our lines of business and ,QIRUPDWLRQIRUVKDUHKROGHUV Group performance sections on pages 19 to 92 form the Strategic Report. &URVVUHIHUHQFHWR)RUP) 7KH{*RYHUQDQFHVHFWLRQRQSDJHVWRIRUPVWKH5HSRUWRIWKH'LUHFWRUV *ORVVDU\RIWHUPV 7KURXJKRXWWKHUHSRUW Reference to other pages Reference to video Reference to further Our business model ORRNRXWIRUWKHVH within the report FRQWHQW{RQOLQH UHDGLQJ{RQOLQH LFRQV{VXFK{DV 1 PC_FRONT.indb 1 5/15/2015 1:46:46 AM 2 BT Group plc Annual Report 2015 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