BT revenue slips as IT business struggles

BT profits

BT Group revenue fell 3 per cent in the third quarter, missing analysts’ estimates for a gain, as its struggling IT business showed continued weakness.

The company reported revenue of £5.97bn in the three months to December 31, compared with an average estimate of £6.07bn, according to a survey of analysts, reports The Telegraph.

Profit before tax rose 25 per cent to £660m while adjusted earnings before interest, taxes, depreciation and amortisation fell 2 per cent to £1.83bn, roughly in line with analysts’ forecasts.

Its TV service lost 5,000 customers during the quarter, BT reported, versus the addition of 52,000 customers in the same period a year ago.

BT is working to turn around its global services IT business, which provides multinational companies with cloud-based and other digital offerings.

The carrier has cut thousands of jobs and shuffled management as it seeks to hold onto customers amid competition from web giants including Amazon.

The global services unit was responsible for a profit warning and writedown a year ago when BT revealed a worse-than-expected accounting scandal in Italy.

Shareholders of BT are awaiting news on several major developments to provide clarity on the company’s cash-flow outlook in the first half of 2018, including the outcome of bidding this month for Premier League football broadcast rights, as well as the results of a triennial pension review, which will determine how much cash BT has to put up to plug a gaping deficit.

After last month being denied an effort to curb future pension payouts by changing the formula for calculating inflation, BT on Friday said it would appeal the court decision.