Revenue was flat with growth of 23% in fibre broadband being offset by lower copper line rental. This also includes regulatory and commercial price changes which had a negative impact of £14m and £21m respectively.
We continue to extend the reach of fibre broadband which is now available to more than 27.4m premises passed by our superfast fibre broadband network. 886,000 of those premises are able to connect to an ultrafast (100Mbps+) service using FTTP or Gfast technology. We achieved a record high 600,000 fibre broadband net connections during the quarter and now have around 9.2m customers connected to fibre (Q3 2016/17: 7.2m).
As a result of strong seasonal offers in the market by our Communications Provider customers we saw higher demand for our FTTC products in the quarter that helped increase our physical line base by around 42,000.
We continue to focus on improving the experience of our customers. So far this year we are ahead on all 60 copper minimum service levels set by Ofcom and we have seen a 4.1% reduction in our copper network faults compared to the same period last year. We continue to engage with Ofcom on the new Ethernet minimum service level measures that apply from December 2017 to March 2019.
Operating costs were 6% higher mainly driven by an increase in business rates charged on network assets and higher pension charges. EBITDA was down 5% and depreciation and amortisation was down 4% with operating profit down 7%.
Capital expenditure was £477m, up £68m or 17%, reflecting our ongoing investment in fibre broadband speed and coverage which contributed to the Government’s achievement to provide superfast broadband coverage to 95% of the UK by December 2017. Capital expenditure was after gross grant funding of £55m (Q3 2016/17: £45m) directly related to our activity on the BDUK programme build which was offset by an increase in our grant funding deferral of £50m (Q3 2016/17: £32m).
Normalised free cash flow was down 8% due to the increased operating costs and capital expenditure partly offset by the timing of customer receipts due in Q2.
You can also view the full Q3 results for BT Group here.