BT profits better than expected
Thursday 03 November 2011
Telecoms giant BT
posted better-than-expected quarterly profits today with the number of
broadband customers surging as they took up superfast connections.
The group added 166,000 new gross retail broadband customers in the three months to September 30, a 46% jump on a year ago, taking its total number to six million.
BT signed 88,000 out of these new users to its Infinity superfast service, which the telecoms giant said had now doubled its number of users to 300,000 in the past six months.
The company said its revenues per user in retail rose by £5 to £335, reflecting the growth in broadband, which helped offset a decline in revenues on its traditional landline telephone business.
BT said group adjusted pre-tax profits increased by 15% to £570 million, compared to market forecasts of about £550 million.
The retail business was also boosted by BT Vision, the firm's video and TV on demand service, which had its best quarter for two years with a net addition of 41,000 users, taking the total to 640,000.
Elsewhere, the formerly troubled global services division cut losses from £41 million to £31 million over the quarter, helped by new contracts with electronics retailer Best Buy to connect 820 stores and also with a large financial brokerage in Asia.
Wholesale was hit by the reduction in mobile phone call termination charges but was flat otherwise, while network arm Openreach increased its profits contribution by 5% as it continues its fibre roll-out across the UK.
BT said that recent market turbulence had affected its pension fund, with the deficit rising to £2.5 billion after tax from £1.4 billion at the end of March.
For the half year, BT posted profits of £1.1 billion with the interim dividend increased by 8% to 2.6p.
Chief executive Ian Livingston said that the group had continued to offset the current economic headwinds through better customer service, efficiency and investment and added that the outlook for the year remains unchanged.
Richard Hunter, head of equities at Hargreaves Lansdown stockbrokers, said that the reiteration of full-year guidance was well received, underpinned by the strength in broadband and Global Services.
"As investors look towards strong, cash generative companies with a decent yield, BT has served up a reminder of why it should be considered," he added. Shares rose 3% in early trading.
- 1 UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
- 2 Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
- 3 The enemy within: People who hear voices in their heads are being encouraged to talk back
- 4 Phil Neville backtracks on Tomas Rosicky 'I'd smash him' comments from Match of the Day 2
- 5 British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
Paris attacks: Do not call Charlie Hebdo killers 'terrorists', BBC says
UK weather: Snow to fall in the coming week with sub-zero temperatures to last until early February
Asteroid narrowly scrapes past Earth: how to watch the closest space rock for decades as it flies by
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Prince Philip set to be knighted by Australia: Celebrate by reading his greatest gaffes
Nigel Farage: NHS might have to be replaced by private health insurance
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
George Galloway condemns 'racist, Islamophobic, hypocritical rag' Charlie Hebdo at freedom of speech rally
iJobs Money & Business
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...
Negotiable: Recruitment Genius: A Tax Assistant is required to join a leading ...