UK telecoms giant BT has reported a decline of 29% in Q2 net income from GBP475m to GBP339m owing to restructuring charges for the period ending September 30, 2007. BT has spent GBP167m in its second quarter to cut approximately 5,000 jobs and develop new systems.
However, BT posted a rise of 3% in Q2 revenues, thanks to good growth in its broadband and networked IT services divisions. EPS before specific items and leaver costs stood at 6.1 pence, up 2% from Q2 2006.
Looking more closely, revenues for BT wholesale declined by 9% to GBP937m, while revenues for BT global services, BT retail, Openreach and others increased by 8.9%, 2.2%, 28.4% and 25% to GBP1,920m, GBP2,025m, GBP208m and GBP5m, respectively, over Q2 2006.
The global services division signed GBP1.6 billion worth contracts in the quarter, taking the total amount of contracts achieved to GBP9.2 billion in the year. The number of wholesale broadband connections (DSL and LLU) at the end of the quarter stood at 11.7m, representing a 2.4 million connection increase in year on year. The total broadband customer base in BT retail, meanwhile, was 4,074,000 at September 30, 2007.
The company spent GBP69m on acquisitions in the second quarter, compared to GBP10m in Q2 2006.
Key competitor BSkyB announced a decline in profit for its most recent quarter. Net profit declined by 28% to GBP84m because of costs to win new broadband customers. Total sales increased by 10.6% to GBP1.2 billlion, driven by growth in subscriptions.
Source: ComputerWire daily updates