UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 20 - F
(Mark One)
¨ | ||
REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OR
x | ||
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended 31 March 2011
OR
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
OR
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SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Date of event requiring this shell company report
For the transition period fromto
Commission File Number: 1-08819
BT Group plc |
(Exact name of Registrant as specified in its charter)
Not Applicable | ||
England and Wales | ||
(Translation of Registrant’s name into English) | (Jurisdiction of incorporation or organization) |
BT Centre 81 Newgate Street, London, EC1A 7AJ England |
(address of principal executive offices)
Securities registered or to be registered pursuant to Section 12(b) of the Act:
Title of each class: | ||||
Name of each exchange on which registered: | ||||
American Depositary Shares | New York Stock Exchange | |||
Ordinary shares of 5p each | New York Stock Exchange* |
* | Not for trading, but only in connection with the registration of American Depositary Shares representing these shares, pursuant to the requirements of the Securities and Exchange Commission. |
Securities registered or to be registered pursuant to Section 12(g) of the Act: None
Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None
Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the Annual Report:
8,151,227,029 Ordinary Shares, of 5p each
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
Yesþx Noo¨
If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
Yeso¨ Noþx
Note — Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 from their obligation under those Sections.
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d)15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Yesþx Noo¨
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
Yes ¨ No ¨
Not Applicable
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨
Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:
U.S. GAAP ¨ | International Financial Reporting Standards as issued by the International Accounting Standards Board x | |||
If “Other” has been checked in response to the previous question indicate by check mark which financial statement item the registrant has elected to follow.
Item 17o¨ Item 18o¨
If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
Yeso¨ Noþx
(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
Yeso¨ Noo¨
Not Applicable
Not applicable
Not applicable
3.A Selected financial data
The information set forth under the headings:
“Financial highlights” on page 6;
“Group financial performance — Group results” on page 43;
“Information for shareholders — Cautionary statement regarding forward-looking statements” on page 177
“Selected financial data” on page 173; and
“Information for shareholders — Exchange rates” on page 182
of the Annual Report & Form 20-F 20112013 as sent to shareholders and included as Exhibit 15.2 to this Form 20-F (“Annual Report 2011”2013”) is incorporated herein by reference.
3.B Capitalization and indebtedness
Not applicable
3.C Reasons for the offer and use of proceeds
Not applicable
3.D Risk factors
This section highlights some of those particularsets out the principal risks and uncertainties affecting our businessus, but it is not intended to be an extensive analysis of all risk and uncertainty affecting our business.exhaustive. These risks have the potential to impact our business, revenues,revenue, profits, assets, liquidity or capital resources.
As in the prior year, the uncertainties in the global economy and capital resources adversely. credit markets continue to present challenges, both to our business and to others. These challenges drive a number of the risks that we face and we focus our efforts on predicting and mitigating them. The principal risks we described last year have evolved, and so has our response to them.
Our processes are designed to giveEnterprise Risk Management framework provides reasonable but(but cannot give absolute,absolute) assurance that thesignificant risks significant to the group are identified and addressed. There may be risks which are unknown or which are presently judged not to be significant but later prove to be significant.
Security and resilience
In keeping with other organisations that process and store data, we have a responsibility to many millions of customers, both business and consumer, to safeguard their electronic information and to maintain the continuity of services. This requires the highest levels of operational security and resilience, which can be threatened at any time by incidents such as malicious cyber-attacks, theft of copper cable and equipment, vandalism, sabotage, extreme weather, component overload, loss of power and human error. The principal risksvolume of traffic through our systems and uncertainties should be considerednetworks is increasing, and customer tolerance of interruptions reduces as the world becomes ever more dependent on information technology.
Changes over the last year
Concerted efforts to deter cable theft, supported by legislative changes and the well publicised arrest and prosecution of thieves, are beginning to reduce the number of service interruptions in conjunctionthe network. Theft of equipment from our premises has also fallen significantly. However, we are detecting more cyber-attacks aimed at stealing data or disrupting our own and our customers’ websites.
We have strengthened our defences against these cyber-attacks and now routinely cope with attacks that a few years ago would have caused considerable risk of data loss. Our segregation and encryption of data has increased. In further
recognition of the importance of people and behaviours in managing this risk, a campaign to raise staff and supplier awareness of cyber threats is proceeding in response to the increasing sophistication of attacks. We have also refreshed our data protection governance with the forward-looking statements for, and the cautionary statement regarding forward-looking statements on page 162appointment of the Annual Report 2011.
We are upgrading much of our businessequipment to improve reliability, increase capacity and global nature of our operations means we are required to manage significant volumes of personalreduce energy consumption. Severe flooding across the UK in the year caused several service outages that demanded urgent action and commercially sensitive information.
A breach of our security, or compromise of data and/or resilience affecting BT’s ownour operations, or those of our customers, could lead to an extended interruption to network services andor even affect national infrastructure. Such failure may lead to a loss of customer confidence, termination of contracts, loss of revenue, and reduced cash resources.generation through penalties and unplanned costs of restoration and improvement. Additional reputational damage and financial loss may arise from a breach involving a legal or contractual failing such as breaching data protection or handling requirements.
Major contracts
We have a number of complex and high valuehigh-value national and multinational contracts with certain customers. The profitability of, and revenue arising from, and the profitability of these contracts isare subject to a number of factors including: variation in cost andcost; achievement of cost reductions anticipated in the contract pricing, both in terms of scale and time; delays in the delivery or achievingachievement of agreed milestones owing to factors either within or outside of our control; changes in customers’ requirements, budgets, strategies or businesses; and the performance of our suppliers; and other factors.suppliers. Any of these factors could make a contract less profitable or even loss making.
The degree of risk generally varies generally in proportion to the scope and life of the contract and is typically higher in the early transitional and transformational stages of the contract. Some customer contracts require significant investment in the early stages, which is expected to be recovered over the life of the contract. Major contracts often involve the implementation of new systems and communications networks, transformation of legacy networks and the development of new technologies. The recoverability of these upfront costs may be adversely impacted by delays or failure to meet milestones. Substantial performance risk exists in these contracts.
Changes over the last year
The difficult economic and market conditions, particularly in Europe, have increased financial and operational pressures on our customers and have made the environment even more competitive. With our investment and expansion into high growth regions, the landscape of our risks and opportunities naturally changes as we must deal with rapidly evolving geo-political risks and different trading environments and business practices. Our control and governance framework has been extended to include contracts between BT and some or all elementsUK local authorities seeking to extend the reach of performance depend upon successful completionfibre broadband in their regions.
For larger contracts, we have recently expanded the scope of independent reviews to critical stages of the transition, development, transformationcontract lifecycle to help identify any key issues, risks and deployment phases.
Impact
Failure to manage and meet our commitments under these contracts, as well as changes in customers’ requirements, budgets, strategies or businesses, may lead to a reduction in our expected future revenue, profitability and cash generation. Unexpectedly high costs associated with the delivery of contracts could also negatively impact profitability. We may lose significant revenuesrevenue due to the merger or acquisition of customers, changes to customer strategy, business failure or contract termination.termination and contracts may become loss-making. Failure to replace the revenue and earnings thereby lost from such customers willcould lead to an overall reduction in group revenue, profitability and cash flow.
Pensions
We have a significant funding obligation in relation to aour defined benefit pension scheme. Decliningschemes. Low investment returns, high inflation, longer life expectancy and regulatory changes may result in the cost of funding BT’s main defined benefit pension scheme, the BT Pension Scheme (BTPS), becoming a significant burden on our financial resources. The
Changes over the last year
Following the conclusion of the 30 June 2011 triennial funding valuation of the BTPS at 31 December 2008 and associated recovery plan was agreed with the BTPS Trustee in February 2010. Under this prudent funding valuation basis the deficit was £9bn and a 17-year recovery plan was agreed. Details ofMay 2012, the valuation assumptions and recovery plan are set out in note 23documentation was submitted to the financial statements.
Government bond yields have fallen since the valuation at 30 June 2011, with real yields being negative at times. This uncertaintyhas been caused by a number of factors, including the Bank of England’s Quantitative Easing programme. If the fall in yields is outside of our control. However, we do not expectmaintained and reflected in the next funding valuation, due as at 30 June 2014, this to be beforewould increase the completionvalue of the next triennialBTPS liabilities.
The European Commission is reviewing the current Directive for pensions and we responded to a relevant consultation during the year. The Commission’s aim is to issue new draft legislation in summer 2013. Depending on its scope, there is potential for any legislative change to have an impact on BT’s funding valuation as at 31 December 2011. As is usual, BT andliabilities in the Trusteefuture. We will engage with the Pensions Regulator regarding the 2011 valuation.
An increase in the pension deficit and associated funding requirements wouldmay have a direct adversean impact on the future cash resourceslevel of deficit payments we are required to make into the group.scheme. Indirectly it may also have an adverse impact on the group’sour share price and credit rating. AAny deterioration in theour credit rating would increase the group’sour cost of borrowing and may limit the availability or flexibility of future funding, thereby affecting theour ability of the business to invest, pay dividends or repay debt as it matures.
Growth in a competitive market
We operate in markets which are characterised byby: high levels of competition including: regulatory intervention on promotingchange; strong competition; declining prices; technology substitution; market and service convergence; customer churn; declining rates of market growth;revenues; new competitors; and emerging competitors with non replicable sources of competitive advantage.
A significant proportion of our revenue and profit areis generated in the UK telecommunications markets which are experiencing limitedwhere the overall telecoms market has been in decline in real terms, despite strong volume growth in revenue terms and in many cases are highly competitive.new services. Revenue from our fixed line calls and lines services to consumers and businesses havehas historically been in decline.decline but new broadband and connectivity markets are growing. Our ability to deliver profitable revenue growth in a responsible and sustainable manner depends on us delivering on our strategic priorities.
Changes over the last year
The level of risk facing our business increased as the economic situation in the UK and other key markets deteriorated in the year. Depressed business activity together with lower disposable incomes continues to be a major barrier to growing revenues, particularly among business customers.
Regulatory decisions made during the year also contributed adversely to our risk profile, revenue and profits. These decisions failed to address imbalances in the competitive playing field. This means that some of our competitors in the consumer space benefit from limited regulation on their core business combined with extensive sector-specific regulation being applied to our UK fixed-line business.
A number of competitor-related developments have contributed to the risk increasing. These include, but are not limited to: the acquisition of Cable & Wireless Worldwide by Vodafone; the decision by Vodafone and O2 to establish a joint venture to consolidate existing network infrastructure and local transmission; the agreement which brought forward the timetable for 4G mobile services being launched in the UK; and increased competitive activity around over-the-top video on demand services in the UK.
Impact
Failure to achieve profitable revenue growth throughfrom our strategic priorities may lead to a continued decline in revenue, erosion of our competitive position and might also lead to a reduction in future profitability, cash flow and to a diminution in shareholder value.
Communications industry regulation
Our activities across all the jurisdictions in which we operate can be impacted by regulation. Regulatory requirements and constraints can directly impact our ability to compete effectively and earn revenues.
In the UK where, following detailed market analysis, we are subjectfound to have significant market power, Ofcom requires us to provide wholesale services at regulated prices. It can also require us to make retrospective repayments to other CPs where we are found to have set prices outside regulatory controls. The controls regulate, among other things,requirements, and can impose fines on us for non-compliance with the prices weregulatory rules, including competition law.
Outside the UK, general licensing requirements can charge for many of our services andrestrict the extent to which we can enter markets and compete. Regulation will also define the terms on which we can purchase key wholesale services from others.
In the UK, risks can come from, for example, periodic market reviews which might introduce tighter regulatory constraints from new charge controls or from CPs disputing or complaining about our pricing, products or services. Outside the UK, regulators can investigate our licensing requirements and whether our services comply with their rules.
Changes over the last year
Over the last year, we have seen regulatory activity in a number of areas. A number of these rulings have resulted in a negative impact either through retrospective price reductions or on our future pricing.
Impact
Risks from regulation are most significant in the UK.
Around £5.8bn of our revenue (of which £3.3bn is to provide servicesdownstream parts of BT) is from wholesale markets where we have been found to other communications providers (CPs). In recent years the effecthold significant market power and which are currently subject to regulatory charge controls. Most of these controls has requiredrequire us to reduce our prices althoughannually to reflect expected reductions in some recent cases,unit costs through efficiency savings. Controls are usually set for three years and will therefore constrain revenues during that period.
Other CPs can ask Ofcom to resolve disputes with us about current or historic prices. Where Ofcom finds that these prices are, or have been, allowed to increase in real terms.
We may from time-to-time be required to provide new services, or existing services on improved terms, to wholesale customers on a non-discriminatory basis, increasingbasis. This could increase our costscosts.
Regulation outside the UK can impact our revenue by restricting our ability to compete through overly-restrictive licensing requirements or ineffective regulation of access to other CP networks.
Business integrity and increasing retail competition. Disputes may result either in reduced revenue or increased costs going forward. ethics
We may also be requiredare committed to make retrospective paymentsmaintaining high standards of ethical behaviour, and have a zero tolerance approach to CPs if it is ruled that past charging mechanisms webribery and corruption. We have applied have overcharged CPs. Appeals may change Ofcom’s decisions, which had originally been concluded in our favour.
We also have been levied against a number of organisations, have grown in frequency and value.
Changes over the last year
The Serious Fraud Office (SFO) has produced revised guidance on the UK Bribery Act which comes into effectAct. The SFO has indicated it will now focus on its role as an investigator and prosecutor of serious and/or complex fraud and where there is sufficient evidence and it is in July 2011 with increased penalties for non-compliant businesses introduces the offencepublic interest, prosecutions rather than civil settlements will now be pursued, even where companies have self-reported. This represents a change to its previous stance where self-reporting may have led to more lenient treatment. It has further confirmed that it considers facilitation payments to be bribes.
The US Department of failingJustice and Securities and Exchange Commission have also produced guidance on the FCPA giving information about the US government’s approach to prevent bribery. WithFCPA enforcement.
In addition, sanctions regulations in Europe and the breadth of BT’s operations and complex commercial relationships we must ensure that we and our business partners are compliant as a continuing priority.
Impact
Failure by our employees, suppliers or agents to comply with anti-briberyanti-corruption and corruptionbribery and sanctions legislation (including the US Foreign Corrupt Practices Act and the UK Bribery Act), or any failure in our policies and procedures to monitor and prevent non-compliance, anywhere in the world, could result in substantial penalties, criminal prosecution and significant damage to our reputation.
Supply chain
The integrity and continuity of our supply chain foris critical to our operations. Our aim is to harness the delivery of goodscapability, diversity and services on time, to cost and specification. A number of factors, including the continuing economic uncertainty have contributed to a heighteninginnovation of the risk of this reliance. Failure of any ofglobal supply market to add value to our critical suppliers to meet agreed deliverables could adversely impact our customer service, product launch, business critical systems updates, revenues or cost efficiency.
The failure of a critical third-party supplier to harness the capability, diversity and innovation of our supply market to add valuemeet its obligations could cause significant harm to our business and customers. the BT brand, as well as potentially impact our cost transformation and efficiency plans.
Changes over the last year
Many suppliers are beingcontinue to be impacted by the global economic downturn and the challenges of globalisation. This is introducing further risk in our supply chain which includes, but is not limited to:as a result we have seen an increase in supplier insolvency; lackthe number of supplier resilience following a disaster;suppliers suffering from financial distress. The downturn has also increased the risk of suppliers applying less focus on key areas such as business continuity management or corporate and social responsibility risks in our extended supply chain; and security risks relatingan effort to data protection.
Impact
Whilst the size of the impact from a supplier failure can vary, all supplier failures typically result in turn couldan increased cost to our business and have the potential to negatively impact their abilitythe service we provide to meet their obligationscustomers. In many cases the cost associated with supplier failure is significant, particularly if it then results in us having to us or, in the extreme, cause them to fail.change technology. If we are unable to contract with an alternative supplier, our customer commitments could also be compromised, possibly leading to contractual breach, loss of revenue, penalties or increased costs.
A failure in our supply chain to meet legal obligations or ethical expectations could adversely impact our reputation or possibly lead to censure, legal action and financial loss.
4.A History and development of the company
The information set forth under the headings:
“Our progress against our strategic priorities” on page 7;
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“How we deliver our strategy” on page 31;
“Group financial performance — Capital expenditure” on page 50; and
“Group financial performance — Capital management and funding policy” on page 48
of the Annual Report 20112013 is incorporated herein by reference.
4.B Business overview
The information set forth under the headings:
“How we are organised” on page 31;
“Our customers and markets” on page 36;
“Regulation” on page 38;
“Our strategy” on page 13;
“Our business model” on page 17;
“Our strategic priorities” on page 14;
“How we measure our progress” on page 22;
“Our assets and resources” on page 20;
“Consolidated financial statements — Notes to the consolidated financial statements — Segment information” on page 116;
“Operational statistics” on page 176;
“Information for shareholders — Cautionary statement regarding forward-looking statements” on page 177; and
“Information for shareholders — Further note on certain activities” on page 188
of the Annual Report 20112013 is incorporated herein by reference.
4.C Organizational structure
The information set forth under the headings:
“Our business model” on page 17;
“How we are organised” on page 31; and
“Subsidiary undertakings” on page 167
of the Annual Report 20112013 is incorporated herein by reference.
4.D Property, plants and equipment
The information set forth under the headings:
“Our assets and resources — Properties” on page 20;
“Consolidated financial statements — Notes to the consolidated financial statements — Property, plant and equipment” on page 128; and
“Financial statistics” on page 175
of the Annual Report 20112013 is incorporated herein by reference.
As far as the Company is aware, there are no unresolved written comments from the SEC staff regarding its periodic reports under the Exchange Act received more than 180 days before March 31, 2011.
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The information set forth under the headings:
“Performance” on page 41; and
“Information for shareholders — Cautionary statement regarding forward-looking statements” on page 177
of the Annual Report 20112013 is incorporated herein by reference.
5.B Liquidity and capital resources
The information set forth under the headings:
“Performance” on page 41;
“Information for shareholders — Cautionary statement regarding forward-looking statements” on page 177;
“Consolidated financial statements — Notes to the consolidated financial statements — Loans and other borrowings” on page 146;
“Consolidated financial statements — Notes to the consolidated financial statements — Financial instruments and risk management” on page 151; and
“Consolidated financial statements — Notes to the consolidated financial statements — Financial commitments and contingent liabilities” on page 162
of the Annual Report 20112013 is incorporated herein by reference.
5.C Research and development, patents and licenses
The information set forth under the headings:
“Our assets and resources — Innovation” on page 21; and
“Financial statistics” on page 175
of the Annual Report 20112013 is incorporated herein by reference.
5.D Trend information
The information set forth under the headings:
“Performance” on page 41;
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“Selected financial data” on page 173; and
5.E Off-balance sheet arrangements
The information set forth under the heading “Financial review“Group financial performance — Funding and capital managementOther information — Off-balance sheet arrangements” on page 5452 of the Annual Report 20112013 is incorporated herein by reference.
5.F Tabular disclosure of contractual obligations
The information set forth under the heading “Financial review“Group financial performance — Funding and capital managementOther information — Contractual obligations and commitments” on page 5452 of the Annual Report 20112013 is incorporated herein by reference.
6.A Directors and senior management
The information set forth under the heading “Board of directors and Operating Committee”Directors” on page 6065 of the Annual Report 20112013 is incorporated herein by reference.
6.B Compensation
The information set forth under the headings:
“Reports of the Board Committees — Report on Directors’ Remuneration” on page 77;
“Consolidated financial statements — Notes to the consolidated financial statements — Retirement benefit plans” on page 132; and
“Consolidated financial statements — Notes to the consolidated financial statements — Share-based payments” on page 142
of the Annual Report 20112013 is incorporated herein by reference.
6.C Board practices
The information set forth under the headings:
“Board of Directors” on page 65; and
“Reports of the Board Committees — Report on Directors’ Remuneration” on page 77
of the Annual Report 20112013 is incorporated herein by reference.
6.D Employees
The information set forth under the headings:
“Our people” on page 18;
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“Group financial performance — Income statement — Operating costs” on page 44; and
6.E Share ownership
The information set forth under the headings:
“Reports of the Board Committees — Report on Directors’ Remuneration” on page 77; and
“Consolidated financial statements — Notes to the consolidated financial statements — Share-based payments” on page 142
of the Annual Report 20112013 is incorporated herein by reference.
7.A Major shareholders
The information set forth under the headings:
“Shareholders and Annual General Meeting — Substantial shareholdings” on page 97; and
“Information for shareholders — Analysis of shareholdings at 31 March 2013” on page 179
of the Annual Report 20112013 is incorporated herein by reference.
7.B Related party transactions
The information set forth under the headings:
“Directors’ information — Interest of management in certain transactions” on page 94; and
“Consolidated financial statements — Notes to the consolidated financial statements — Related party transactions” on page 162
of the Annual Report 20112013 is incorporated herein by reference.
7.C Interests of experts and counsel
Not applicable
8.A Consolidated statements and other financial information
See Item 18 below
In addition, the information set forth under the headings:
“Group financial performance — Other information — Legal proceedings” on page 52;
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“Group financial performance — Income statement — Dividends” on page 46;
“Consolidated financial statements — Notes to the consolidated financial statements — Financial commitments and contingent liabilities” on page 162;
“Information for shareholders — Dividends” on page 180; and
“Information for shareholders — Articles of Association (Articles) — Dividends” on page 183
of the Annual Report 20112013 is incorporated herein by reference.
8.B Significant changes
The information set forth under the heading “Funding and capital management“Directors’ information — Going concern” on page 5493 of the Annual Report 20112013 is incorporated herein by reference.
9.A Offer and listing details
The information set forth under the heading “Information for shareholders — Stock exchange listings — Share and ADS prices” on page 163178 of the Annual Report 20112013 is incorporated herein by reference.
9.B Plan of distribution
Not applicable
9.C Markets
The information set forth under the heading “Information for shareholders — Stock exchange listings” on page 163178 of the Annual Report 20112013 is incorporated herein by reference.
9.D Selling shareholders
Not applicable
9.E Dilution
Not applicable
9.F Expenses of the issue
Not applicable
10.A Share capital
Not applicable
10.B Memorandum and articles of association
The information set forth under the heading “Information for shareholders — Articles of Association (‘Articles’)(Articles)” on page 167183 of the Annual Report 20112013 is incorporated herein by reference.
10.C Material contracts
The information set forth under the heading “Information for shareholders — Material contracts” on page 170186 of the Annual Report 20112013 is incorporated herein by reference.
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The information set forth under the heading “Information for shareholders — Limitations affecting security holders” on page 172189 of the Annual Report 20112013 is incorporated herein by reference.
10.E Taxation
The information set forth under the heading “Information for shareholders — Taxation (US Holders)” on page 170186 of the Annual Report 20112013 is incorporated herein by reference.
10.F Dividends and paying agents
Not applicable
10.G Statement by experts
Not applicable
10.H Documents on display
The information set forth under the heading “Information for shareholders — Documents on display” on page 172189 of the Annual Report 20112013 is incorporated herein by reference.
10.I Subsidiary information
Not applicable
The information set forth under the headings:
“Consolidated financial statements — Notes to the consolidated financial statements — Significant accounting policies — Financial instruments” on page 114; and
“Consolidated financial statements — Notes to the consolidated financial statements — Financial instruments and risk management” on page 151
of the Annual Report 20112013 is incorporated herein by reference.
12.D American Depositary Shares
During the 2010/112013 financial year, the Company received direct and indirect payments from the Depositary of USD604,412.75USD 498,009.08 which included the annual NYSE listing fee, investor relations expenses and other costs relating to the ADR program.
The Depositary also waived fees of USD215,000USD 215,000 for administering the ADR program.
Category (as defined by SEC) | Depositary Actions | |||||
Associated Fee | ||||||
(a) Depositing or substituting the underlying shares | Each person to whom ADRs are issued against deposits of Shares, including deposits and issuances in respect of: • Share distributions, stock split, rights, merger • Exchange of securities or any other transaction or event or other distribution affecting the ADSs or the Deposited Securities | USD 5.00 for each 100 ADSs (or portion thereof) evidenced by the new ADRs delivered | ||||
(b) Receiving or distributing dividends | Distribution of dividends | USD 0.02 or less per ADS | ||||
(c) Selling or exercising rights | Distribution or sale of securities, the fee being in an amount equal to the fee for the execution and delivery of ADSs which would have been charged as a result of the deposit of such securities | USD 5.00 for each 100 ADSs (or portion thereof) |
Category (as defined by SEC) | Depositary Actions | Associated Fee | ||||
(d) Withdrawing an underlying security | Acceptance of ADRs surrendered for withdrawal of deposited securities | USD 5.00 for each 100 ADSs (or portion thereof) evidenced by the ADRs surrendered | ||||
(e) Transferring, splitting or grouping receipts | Transfers, combining or grouping of depositary receipts | USD 2.50 per ADS | ||||
(f) General depositary services, particularly those charged on an annual basis | • Other services performed by the depositary in administering the ADRs • Provide information about the depositary’s right, if any, to collect fees and charges by offsetting them against dividends received and deposited securities | USD 0.02 per ADS (or portion thereof) not more than once each calendar year and payable at the sole discretion of the depositary by billing Holders or by deducting such charge from one or more cash dividends or other | ||||
(g) Expenses of the depositary | Expenses incurred on behalf of Holders in connection with • Compliance with foreign exchange control regulations or any law or regulation relating to foreign investment • The depositary’s or its custodian’s compliance with applicable law, rule or regulation • Stock transfer or other taxes and other governmental charges • Cable, telex, facsimile transmission/delivery • Expenses of the depositary in connection with the conversion of foreign currency into U.S. dollars (which are paid out of such foreign currency) • Any other charge payable by depositary or its agents | Expenses payable at the sole discretion of the depositary by billing Holders or by deducting charges from one or more cash dividends or other cash |
8
Not applicable
Not applicable
The information set forth under the headings:
“General Information — US Regulation — US Sarbanes-Oxley Act of 2002” on page 85 94;
“General Information — US Regulation — Disclosure controls and procedures” on page 95;
“General Information — US Regulation — Internal control over financial reporting” on page 95; and
“Report of the independent auditors — Consolidated financial statements — United States opinion” on page 101
of the Annual Report 20112013 is incorporated herein by reference.
The information set forth under the heading “Business policies“General Information — US Regulation — US Sarbanes-Oxley Act of 2002” on page 8594 of the Annual Report 20112013 is incorporated herein by reference.
The information set forth under the heading “General Information — US Regulation — US Sarbanes-Oxley Act of 2002” on page 94 of the Annual Report 2013 is incorporated herein by reference.
ITEM 16.C PRINCIPAL ACCOUNTANT FEES AND SERVICES
16.C(a)Audit Fees
The information set forth in the table under the heading “Audit services” in “Consolidated financial statements — Notes to the consolidated financial statements — Audit, audit related and other non-audit services” on page 114120 of the Annual Report 20112013 is incorporated herein by reference.
16.C(b)Audit-Related Fees
The information set forth in the table under the heading “Non-audit services — The audit of the company’s subsidiaries pursuant to legislation” in “Consolidated financial statements — Notes to the consolidated financial statements — Audit and non-audit services” on page 114 of the Annual Report 2011 is incorporated herein by reference.
16.C(c)All OtherTax Fees
The information set forth in the table under the headings “Non-audit“Other non-audit services — Other services pursuant to legislation”, “Non-auditTaxation compliance services” and “Other non-audit services — Services relatingTaxation advisory services” in “Consolidated financial statements — Notes to corporate finance transactions”the consolidated financial statements — Audit, audit related and “Non-auditother non-audit services” on page 120 of the Annual Report 2013 is incorporated herein by reference.
16.C(d)All Other Fees
The information set forth in the table under the headings “Other non-audit services — All other assurance services” and “Other non-audit services — All other services” in “Consolidated financial statements — Notes to the consolidated financial statements — Audit, audit related and other non-audit services” on page 114120 of the Annual Report 20112013 is incorporated herein by reference.
16.C(e)
The information set forth under the headings:
“Reports of the Board Committees — Audit & Risk Committee Chairman’s report” on page 71; and
“Consolidated financial statements — Notes to the consolidated financial statements — Audit, audit related and other non-audit services” on page 120
of the Annual Report 20112013 is incorporated herein by reference.
16.C(f)
Not applicable
The information set forth under the heading “The Board“Information for shareholders — Share buyback” on page 180 of the Annual Report 2013 is incorporated herein by reference.
ITEM 16.F CHANGE IN REGISTRANT’S CERTIFYING ACCOUNTANT
Not applicable
ITEM 16.G CORPORATE GOVERNANCE
The information set forth under the heading “General Information — US Regulation — New York Stock Exchange” on page 6494 of the Annual Report 20112013 is incorporated herein by reference.
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Not applicable
The financial information concerning the Company set forth under the headings:
“Report of the independent auditors — Consolidated financial statements — United States opinion” on page 101; and
“Consolidated financial statements” on page 102
of the Annual Report 20112013 is incorporated herein by reference.
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1.1 | Articles of Association of the Company, incorporated by reference to Exhibit 1.1 to the Company’s Annual Report on Form 20-F dated May 26, 2010 | |||
4.1 | Letter of appointment | |||
4.2 | ||||
dated 17 October 2011, incorporated by reference to Exhibit 4.12 to the Company’s Annual Report on Form 20-F dated May 24, 2012 | ||||
7.1 | ||||
8.1 | Significant subsidiaries as of March 31, | |||
12.1 | ||||
12.2 | ||||
13.1 | ||||
15.1 | ||||
15.2* | ||||
* | Certain of the information included within Exhibit 15.2, which is provided pursuant to Rule 12b-23(a)(3) of the Securities Exchange Act of 1934, as amended, is incorporated by reference in this Form 20-F, as specified elsewhere in this Form 20-F. With the exception of the items and pages so specified, the Annual Report & Form 20-F is not deemed to be filed as part of this Form 20-F. |
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BT Group plc | |||||
/s/ Tony Chanmugam | |||||
Name: | Tony Chanmugam | ||||
Title: | Group Finance Director | ||||
Date: May 27, 2011
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