New wave turnover sustains BT profits

A new wave of hi-tech turnover including broadband connections has helped BT to hold the line on profits.

In its quarterly report published today, BT Group reported that turnover for the year was up 1%, at £9.2 billion. Most growth was in what BT described as "new wave" turnover that increased by 34% in the year to reach £1,969 million. However, year-on-year BT profits before taxation fell by 4% to £983 million.

The boost in turnover helped lower the group's net debt by 6% on the previous year to £8.27 billion.

The report noted that the number of broadband users had reached 3.3 million, with a record high of 607,000 DSL connections made in the three months to September.

Commenting on the group's results in the second trading quarter, BT Chief Executive Ben Verwaayen, said: “The 36% growth of new wave revenues helped us deliver the best underlying revenue growth in almost three years. We continue to improve earnings per share, up 9% before goodwill amortisation and exceptional items.

“We are winning business across the globe and responding innovatively to an intense competitive environment, particularly in the UK. Our agreement to acquire Infonet is another step in BT’s transformation into a leading provider of IT and networking services.

“We now have more than 3.3 million broadband DSL customers, with the latest million connections achieved in less than six months, which is a new connection every 15 seconds."

The BT Chief Executive said that the results demonstrated a "continuing ability to improve earnings whilst building for the future".

In November, BT signed to acquire the international managed voice and data network service provider Infonet for £520 million. BT said this acquisition marked a "significant step forward in BT’s strategy of addressing the IT and networking services needs of multi-site companies and organisations".

Turnover from BT's traditional business sectors such as land-line telephony declined by 6% in the last year.

(SP/GMCG)