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UPDATE 2-BT nudges up earnings view, but sees long recovery from COVID

* Raises lower limit for full-year earnings guidance

* Seeing robust demand for new faster products

* Forecasts return to pre-COVID earnings level in 2022/23

* Shares rise as much as 9% (Adds CEO comments, shares)

LONDON, Oct 29 (Reuters) - BT nudged up its full-year earnings guidance on Thursday, sending its shares as much as 9% higher, though Britain’s biggest fixed-line and mobile telecoms firm said profits probably wouldn’t get back to pre-pandemic levels until 2022-23.

The company said it delivered a strong operational performance in the first half of its fiscal year despite the pandemic, with customer satisfaction improving and the roll-out of fibre broadband and 5G mobile networks continuing at pace.

Chief Executive Philip Jansen said in the last five or six weeks volumes into call centres, online visits and store sales had surpassed pre-COVID levels, including strong demand for the Apple’s new 5G iPhone 12.

“We have good progress on our modernisation and cost saving programme and we have seen robust demand for our products,” he told reporters.

“As a result, we have increased the lower end of our adjusted EBITDA (earnings before interest, tax, depreciation and amortisation) outlook range for this year to a range of 7.3 to 7.5 billion pounds from 7.2-7.5 billion.”

He forecast earnings in the year ending March 2023 would be at least 7.9 billion pounds ($10.3 billion), the amount BT reported for 2019/20, driven by cost savings and sales of combined broadband, mobile and TV products as well as fibre-to-the-home and 5G connections.

Shares in BT, which have tumbled from nearly five pounds five years ago to 95 pence in August, were up 6% at 108 pence at 0915 GMT.

Jefferies analyst Jerry Derry said BT was notably more confident than in July, giving a more detailed forecast on when it expected to recover from the pandemic.

Jansen said the forecast growth in earnings underpinned the planned reinstatement of a dividend of 7.7 pence a share next fiscal year and continued investments in networks. BT said in May it would not pay a dividend for the current year.

BT’s first-half financial performance was broadly in line with expectations, Jansen said, with an 8% drop in revenue to 10.59 billion pounds, reflecting the pandemic impact on its BT Sport and roaming revenue and reducing activity for its business customers.

Adjusted earnings fell 5% to 3.72 billion pounds.

BT’s European peers Orange and Telefonica also detailed the impact of the pandemic on their finances on Thursday.

$1 = 0.7673 pounds Reporting by Paul Sandle; editing by Sarah Young and Mark Potter

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