BT reported a 6 percent rise in full-year revenue on Thursday to £18.91 billion ($27.46 billion), including the acquisition of mobile operator EE, and up 2 percent on an underlying basis.
Earnings before interest, taxes, depreciation and amortization (EBITDA) rose 5 percent including the EE acquisition, to £6.58 billion, and up 1 percent on an underlying basis. Shares in the group rose over 3 percent in opening trade.
The company's full-year proposed dividend rose 13 percent to 14.0 pence per share.
BT Chief Executive Gavin Patterson told CNBC that the company's priority was to pay down its net debt (of £9.8 billion as of March 31, up £4.82 billion primarily due to the acquisition of EE) but said that it could at the same time offer investors an increased dividend.
"Today we're guiding that over the next two years our dividend will increase by a minimum of ten percent in each of the next two fiscals (years)," he said, adding that the company was balancing investment with paring down debt.
"It is one of the challenges we have as a business – balancing the needs of shareholders who want more dividend, we want to invest in the future to ensure that the infrastructure keeps the U.K. at the head of the charge, look after that pension to make sure that deficit doesn't become unmanageable so it is a balancing act."
Earlier in the year, Britain's competition authorities cleared BT's £12.5 billion acquisition of EE, saying it would not substantially lessen competition in the broadband, fixed and mobile markets.