BT profit soars on cost-cutting, Global unit
BT’s recovery is still a work in progress, according to chief executive Ian Livingstone, after the UK carrier boosted quarterly earnings almost threefold to £178 million.
The telco saw revenues fall 4% year-on-year to £5.1 billion year-on-year in the quarter, but operating profit was up from £209 million a year earlier to £473 million, and net income was £178 million, up from £62 million.
The troubled Global Services unit posted ebitda of £123 million – up from £28 million in the prior quarter and £7 million in 2008.
Livingstone said he was pleased with the firm’s progress, particularly in the area of cost reduction, which resulted in it trimming £1.6 billion from outgoings in the nine months to December 31.
The savings will help the carrier roll-out fiber networks required to offer next-generation, super-fast, broadband services.
The carrier also lowered capital expenditure by £208 million year-on-year to £554 million for the quarter, but predicts the figure will be up in coming quarter, leaving the full-year 2009 spend at £2.5 billion – down slightly from its previous forecast of £2.6 billion.
“These results show that we are making progress,” Livingstone states, adding. “There is still a lot more to be done but our commitment to improved customer service and cost transformation is starting to deliver results.”
Based on the latest quarterly figures, the firm predicts it will achieve full-year 2009 ebitda of £5.7 billion. Free cash flow is tipped to reach £1.7 billion, not counting a pension deficit payment of £525 million.