BT reveals solid third quarter financials

11 Feb 2010

British fixed line incumbent BT has posted better-than-expected financial results for its third fiscal quarter of the 2009-10 financial year. For the three months ended 31 December 2009 the company reported that revenue had fallen 4.4% year-on-year to GBP5.19 billion (USD8.13 billion), down from GBP5.44 billion a year earlier. Despite the decline, market watchers had anticipated that BT’s group revenue could tumble to around GBP5.14 million. Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) meanwhile was up 11% against the corresponding period a year earlier at GBP1.44 billion, although foreign exchange movements reportedly had a GBP5 million negative effect on EBITDA. Net profit for 3Q 2009 was GBP178 million, up from GBP62 million in October-December 2008.

BT expects that cost savings and improved results from its Global Services division will deliver EBITDA of approximately GBP5.7 billion in full year 2009-10. The company revealed that in the three months to end-December 2009 operating costs and capital expenditure had fallen by GBP702 million, with underlying group operating costs, excluding depreciation and leaver costs, reduced by 10%, primarily due to reductions in total labour costs and cost savings across all of its business units. Capital expenditure meanwhile was GBP208 million less than the same period last year at GBP554 million, which BT said reflected steps it has taken to improve procurement.

Commenting on the financial data, BT chief executive, Ian Livingston, said: ‘These results show that we are making progress. There is still a lot more to be done but our commitment to improved customer service and cost transformation is starting to deliver results and freeing up resources to invest in our future. In particular, we are one of Europe’s largest investors in super-fast fibre-based broadband and this will bring huge benefits to our customers and the UK.’

United Kingdom, BT Group (incl. Openreach)