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Total
Shareholder Return
Total shareholder return
(TSR) is the measure of the returns that a company has provided for its
shareholders, reflecting share price movements and assuming reinvestment of
dividends. It is, therefore, a good indicator of a company’s overall
performance.
Over the past five years (as shown in the TSR chart below),
BT after performing very strongly in the first year, has suffered falls in its
share price like many stocks in the telecoms, media and technology (TMT)
sector. BT’s TSR (as adjusted for the rights issue and demerger) over the last
five years was negative 72% compared to a FTSE 100 TSR fall of negative 20%.
However, over the past year both BT and the FTSE 100 have delivered a very
positive performance (BT positive 18% and the FTSE 100 positive 26%).
In the period between the demerger on 19 November 2001 and
31 March 2004, BT’s share price outperformed the European Telecoms sector for
most of the period. However, BT shares have not matched the sector recovery in
the most recent months resulting in an underperformance versus the European
Telecom sector by around 8% (as shown in the share price performance chart),
over the 28 month period.
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