BT revenues down
But sorts out £9bn pension black-hole
BT revenues for the three months ended 31 December 2009 were down four per cent on the same period last year.
Revenue was £5,198m but better performance from BT Global Services and continued group-wide cost cutting meant operating profit was up to £690m, compared to £578m last year.
Ian Livingstone, BT's chief executive, said the results showed the telco was making progress, but still has more to do. He predicted that investment in super-fast broadband will bring big benefits to customers and to the UK. Full statement is here.
BT Global Services made sales of £2,188m, down three per cent on last year, but reversing recent problems. BT Retail made £2,061m, a five per cent drop, and BT Wholesale fell eight per cent to £1,092m. Openreach made £1,292m down three per cent on the same three months of 2008.
In other news BT has reached agreement with its pension trustees about how to sort out the £9bn hole in the accounts - although the pensions regulator still has "substantial concerns" with parts of the deal.
The deficit as of 31 December 2008 was £9bn. BT will pay this off at a rate of £525m for the first three years of the 17 year plan. In the fourth year this will go up to £583m and then go up by 3 per cent per year.
BT said if the valuation had been made using a "median estimate" of how investments might be expected to perform it would have shown a deficit of £3bn - suggesting their higher estimated deficit has a decent margin of error. ®
How would a normal business react?
As opposed to the fixed "we are still a monopoly" minds at BT who will simply increase prices yet again.
See the recent letter from Warren Buckley about the "useful features of your landline" which on the back and in smaller sized print listed the April increases.. Even smaller print at the bottom tells you those prices are only correct at December 2009.
How many customers are they prepared to lose before taking a common sense approach?
Drop means less, doesn't it?
"BT Retail made £2,061m, a five per cent drop,". That's cropped from the article. I stick with my previous opinion.
Did you read the same article as me? It says that profits were UP by £120M for the quarter.