Global Services still BT’s black sheep

Telecommunications and IT services provider BT saw its profits fall by 3% to £1.3 billion in the first quarter of the financial year, as revenues grew by 1% to £5.1 billion.

Once again, it was the company’s IT services divisions that was to blame. That division grew its quarterly revenues by 4% to £2.1 billion – thanks to currency fluctuations during the quarter. But currency fluctuations also triggered an 11% hike in operating cost to £2 billion which contributed to an operating loss of £124 million, compared with a £1 million profit in the same quarter of last year.  

Other divisions of the business saw revenues fall too. At BT Retail, its consumer phone and broadband division, revenue fell by 2% to £2.1 billion. Nevertheless, operating cost was cut and operating profit rose 30% to £359 million.

Revenues fell by 1% to £1.1 billion at BT Wholesale, the commercial telephony business, and operating profit also dropped 3% to £149 million. Network operations unit Openreach’s revenue was flat at £1.1 billion, and operating profit fell 5% to £302 million.

We have made a solid start to the year against a background of challenging trading conditions,” said CEO Ian Livingstone. “BT Global Services is making progress although there is still much to do. The rest of the group continues to perform.”

Pete Swabey

Pete Swabey

Pete was Editor of Information Age and head of technology research for Vitesse Media plc from 2005 to 2013, before moving on to be Senior Editor and then Editorial Director at The Economist Intelligence...

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