BT results beat expectations with £2.5bn yearly profits

Despite posted modest sales figures for its final quarter and year end to 31 March 2013, BT has beat analyst expectations and posted a yearly profit of £2.5 billion.

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Despite posted modest sales figures for its final quarter and year end to 31 March 2013, BT has beat analyst expectations and posted a yearly profit of £2.5 billion.

For the fourth quarter, sales slumped two percent to £4.785 billion, and there was a five percent dive for the year to £18.25 billion. There was also a five percent reduction in pre-tax profits for the fourth quarter to £687 million.

However, the full year pre-tax profits rose to £2.5 billion.
BT's net debt also fell by £1.285 billion to £7.797 billion, despite the pressure of a huge long-term pension deficit and an ongoing infrastructure improvement programme.

The performance of BT's outsourcing arm, BT Global Services, was in decline, seeing sales of £1.9 billion in the fourth quarter - down three percent on the same quarter the previous year. For the full year the Global Services saw sales slump eight percent to £7.1 billion.

To keep shareholders happy BT has proposed a full year share dividend of 9.5p - up 14 percent.
Ian Livingston, BT chief executive, said: "We are doing what we said we would do. In an environment where it is easier to focus only on the short-term, we are investing in our future and delivering growth in profits and dividends.

"We are driving fibre across the UK, launching high quality sports channels, investing in the high-growth regions of the world and will use our WiFi capabilities and 4G spectrum to make sure our customers will be the best connected."

Livingston said: "We have created around 3,000 new jobs in the UK over the last year to support these investments. Our focus on improving efficiency across the business will allow us to continue to deliver strong financial results whilst making these investments. Our good performance this year is reflected in our dividend which is up 14 percent for the year."

In the rush to fibre broadband services BT, Sky and Virgin Media are in the middle of a fierce marketing battle to provide consumers with "triple play" packages of telecoms, broadband and TV.

BT announced this week that its new BT Sport package - which includes live football - will be "free" to BT broadband customers. But potential customers sucked into this service will still need to also pay for a fixed telecoms line rental along with their broadband to get it, as the BT TV digibox requires both a phone line and broadband to work - unlike the services supplied by Virgin and Sky.

The BT digibox family is also still incapable of receiving HD channels, something which may put off some customers from moving from Virgin or Sky to BT.

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