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BT reveals profit growth

18/05/2006

Telecommunications giant BT revealed its best trading performance for four years as it recorded a pre-tax profit increase of five per cent this morning.

Announcing its annual results, the firm confirmed that the six per cent increase in its £19.5 billion annual revenue meant it was able to provide a full year dividend of 11.9p per share for its shareholders, up 14 per cent.

Analysts expected BT to reveal impressive annual results today but the company's performance was boosted beyond expectations by a bumper fourth quarter, which saw revenue up seven per cent and pre-tax profits of four per cent.

Ben Verwaayen, the company's chief executive, said that "BT has changed very significantly from four years ago, and the transformation is accelerating".

"BT is now a truly global company, delivering services to more than 170 countries with more than 20 per cent of our networked IT services contract wins outside the UK," he added.

Expansion of BT's "new wave" products was the highlight of its fourth quarter results, which showed a rise in the number of customers signing up to its high speed broadband internet connection up from under seven million at the end of 2005 to over eight million by the beginning of this month.

Total pre-tax profits of £2.2 billion have been largely used to reduce the company's pensions gap from £4 billion to £2 billion, a reduction which led Mr Verwaayen to conclude to the BBC that "pensions are no longer a problem for us".

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