BT's new wave drives 'excellent' quarter
Revs up, profit up
BT appears to be coping with the loss of 100,000 phone punters a month by making giant strides in broadband and other "new wave" areas. The UK telco is weaning itself off its dependency on traditional phone services and instead turning to its "new wave" fix to keep the business moving forward.
The UK's former phone monopoly saw its share of domestic UK phone customers dip from 63 per cent to 62 per cent over the year to March as more and more punters switched to rival providers such as Carphone, Tele2 and Tesco. This exodus, plus increased price competition, led to a fall in revenues from BT's traditional retail phone business from £10.77bn to £9.78bn.
At the same time, turnover for the whole of the BT group rose 1 per cent to £18.62bn as it racked up pre-tax profits of £2.08bn - up four per cent on last year.
Much of this revenue growth was due to the rapidly rising revenues from BT's new wave business such as ICT (Information and Communications Technology) and broadband. New wave turnover grew 32 per cent to £4.47m over the last year driven by strong growth in ICT and broadband, and now accounts for around a quarter of BT's annual revenues.
Over the last three months alone broadband takings increased 61 per cent to £163m compared to last year as BT Retail racked up 1.75m high-speed end users. The total number of wholesale BT broadband lines now stands at more than five million with a record 825,000 DSL connections completed in the quarter.
Chipper chief exec Ben Verwaayen described the last quarter as "excellent", adding: "We have more than doubled the number of broadband DSL connections in the year, hit the five million target a year early and are increasing broadband speeds by up to four times," he said.
By mid morning shares in BT were up 4.35 per cent (8.75p) at 210p. ®