BT profit falls as Global Services weighs

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BT Group’s profit fell 81 per cent in the third quarter, as its otherwise solid business was held back by its troubled Global Services division.

Across the group, third quarter profit fell 81 per cent from the previous quarter to £113 million, but revenue climbed five per cent to £5.4 billion – driven largely by acquisitions and positive foreign exchange, BT said.

Earnings (before charges) fell nine per cent, hit by trouble at BT’s Global Services division, which recently saw the departure of its chief executive François Barrault in November after a negative trading update.

Ian Livingston, BT Group’s chief executive, said in a statement: “Three of our businesses performed ahead of expectations in the quarter and the group, excluding Global Services, delivered the best year on year profit growth for five years. However, as previously announced, the group results have been severely impacted by the performance of our Global Services division.”

Livingston said BT is looking to improve Global Services' cash flow and performance, and expects the group’s cash flow to be over £1 billion next year.

Revenue at BT’s consumer arm fell six per cent, but it added 83,000 consumer broadband users, taking it’s total to 4.7 million. WiFi use climbed 13 per cent.

The business and enterprise divisions were basically flat. BT’s business side posted a 0.4 per cent increase in revenue for the quarter, as mobility and IT services offset a fall in call and fixed line revenue.

The enterprise arm posted 18 per cent growth, but this was largely because of recent positive acquisitions. Disregarding the buys of Wire One Communications and Ufindus, the division’s revenue was flat.

BT said late last year that it would cut 10,000 jobs.

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