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BT still number one for broadband but profits sharply down

Manoj Solanki, Thursday February 12, 2009 - 1:17 PM

Problems in the BT Global services division left BT with a disappointing set of third quarter results.

Profits were down by 81 percent, with the company having to write down the value of contracts in BT Global Services to the order of £336 million.  BT plans “decisive action” to improve performance in the division.  BT however also warns of further losses in the division.

Elsewhere, growth was steady in BT Retail.  The company had a total of 13.6 million wholesale broadband connections at the end of 2008.  Out of 296,000 net additions in the quarter, BT’s retail arm (BT Total Broadband) took 28% of these.  It remains the most popular broadband provider with 4.7 million customers.   Use of its WiFi network increased, and additional locations have been added to its BT FON wireless network.

Revenue was up 5% to £5,437 million, but pre-tax profits were just £113 million.

Ian Livingston, Chief Executive, said: “We need to build a solid base in Global Services from which we can deliver positive cash flows. We have already announced changes in management and are making significant financial and operational changes to the business. We are also trying to change the division’s cash flow profile to ensure it’s less concentrated towards the fourth quarter and, as a result, fourth quarter cash inflow in Global Services will be significantly lower than last year’s exceptionally high figure.


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Article keywords:   Broadband, Bt, Results, Third Quarter