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. ®