BT posts forecast-beating second quarter profits

TELECOMs giant BT today unveiled forecast-beating profits for the second quarter of its financial year, boosted by a surge in the number of customers signing up for superfast broaband connections.

BT, which employs around 93,000 people in the UK, including 3,500 at its Adastral Park research site at Martlesham Heath, posted an adjusted pre-tax profit of �570million for the three months to September 30, a 15% increase on the same period last year and ahead of market forecasts of around �550m.

The performance left profits for the first half of the year 17% up on an adjusted basis at �1.10billion, and 37% ahead on a reported basis at �1.07bn.

There will be an interim dividend of 2.6p per share, 8% up on last year’s first half.

BT said it secured 166,000 new retail broadband customers during the the second quarter, 46% up on the same period a year ago and taking its total to 6.0million.

Of the new customers, 88,000 were signed up to its superfast Infinity service, which the company said had now doubled its number of users to 300,000 during first half of the year.

Revenues per user in retail rose by �5 to �335, reflecting the growth in broadband, which partially offset a fall in revenues from the group’s traditional landline telephone business.

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Total revenues fell by 2% during the second quarter, to �4.894bn, and by 3% over the first half, to �9.658bn. However, underlying revenues edged ahead by 0.4% in the second quarter, cutting the underlying decline for the year so far to 1%.

BT chief executive Ian Livingston said: “We have increased cash flow, profits and underlying revenue in the quarter.

“This progress has been supplemented with positive operational performances in most of our businesses. We achieved a market leading 63% share of broadband net additions and another quarter of growth in fixed lines.”

He added: “We expect to continue to offset the economic headwinds through improved customer service and processes, better efficiency and investment in the future of the business.”