Feeds

Redundancy costs dent BT profits

But the cutbacks are working

  • alert
  • submit to reddit

Build a business case: developing custom apps

BT's results for its second quarter - ended 30 September 2009 - are not as bad as expected.

The company's aggressive cutting of jobs and costs is working and it was hoping to hit £1bn for the year, having already cut £900m from annual spending. It expects to make free cash flow of £1.6bn compared to previous expectations of £1bn

Revenue for the three months is £5,122m, down three per cent on last year, or six per cent down including currency movements. Operating profit was £550m, compared to £648m last year. Ebitda was £1,436m, up two per cent on last year's figure. Group operating costs were down three per cent to £4,559m and BT spent £21m on redundancy deals.

Chief executive Ian Livingstone said it had been a quarter of progress, but there was still work to do.

BT Global Services made a loss of £96m on sales of £2,024m, down three per cent on the same three months of 2008. Costs at the division were down eight per cent.

BT Retail brought in £2,062m in sales and made an operating profit of £356m.

The Wholesale business made £1,125m compared to £1,168m last year and an operating profit of £158m.

Revenues at Openreach are divided between cash from other divisions and money brought in from outside the firm. External revenue was £299m, compared to £242m last year, while revenue from other BT divisions was £986m compared to £1,061 last year.

The company is raising its dividend for the year by five per cent and is paying an interim divi of 2.3p.

The firm's bottom line had a large hole blown in it last time by BT Global Services, which made a loss of £1.5bn on sales of £2.1bn. The division's boss, Francois Barrault, took home a £2.85m severance package. Some 15,000 other people lost their jobs at BT this year, and the same number will go next year, presumably with slightly less cash in their pockets.

Full numbers here. ®

The essential guide to IT transformation

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
So, Apple won't sell cheap kit? Prepare the iOS garden wall WRECKING BALL
It can throw the low cost race if it looks to the cloud
Time Warner Cable customers SQUEAL as US network goes offline
A rude awakening: North Americans greeted with outage drama
Shoot-em-up: Sony Online Entertainment hit by 'large scale DDoS attack'
Games disrupted as firm struggles to control network
BT customers face broadband and landline price hikes
Poor punters won't be affected, telecoms giant claims
Netflix swallows yet another bitter pill, inks peering deal with TWC
Net neutrality crusader once again pays up for priority access
EE plonks 4G in UK Prime Minister's backyard
OK, his constituency. Brace yourself for EXTRA #selfies
prev story

Whitepapers

Top 10 endpoint backup mistakes
Avoid the ten endpoint backup mistakes to ensure that your critical corporate data is protected and end user productivity is improved.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Backing up distributed data
Eliminating the redundant use of bandwidth and storage capacity and application consolidation in the modern data center.
The essential guide to IT transformation
ServiceNow discusses three IT transformations that can help CIOs automate IT services to transform IT and the enterprise
Next gen security for virtualised datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.