BT unveils new structure and 24% jump in pre-tax profits

BT Announced a "Standout Quarter" in the three months to the end of December and a restructuring of its business following its recent acquisition of EE.

 

It saw a 24% rise in pre-tax profits to £862m.

Revenue rose 3% to £4.59bn, up 4.7%, which it said was its best result for more than seven years.

The results and restructuring come three days after BT acquired EE.

 

The £12.5bn deal has brought together the UK's largest fixed-line business and the largest mobile telecoms company.

Regulatory uncertainty

BT has also announced that Clive Selley is to be the new chief executive of Openreach.

It said Openreach -the unit which connects homes to the internet - will be unaffected by the re-organisation and will be run "at arm's length from the rest of BT."

Regulator Ofcom is due to report soon on its first major review of the telecoms sector for a decade

Its chief executive, Sharon White, said one option was "the structural separation" of Openreach from BT.

Critics of BT say it has not invested enough in Openreach, and want it to become a separate business.

In January a cross-party group of more than 100 MPs, led by the former Conservative party chairman Grant Shapps, requested a split.

The company said Openreach had connected a net 494,000 new customers, which is a 32% increase.

Chief executive Gavin Patterson said: "BT Consumer had a stand-out quarter, increasing its overall line base for the first time in well over a decade and capturing 71% of new broadband customers."

He added that he was confident they would "deliver the anticipated cost and revenue synergies" from its acquisition of EE.

New structure

The company said under its restructuring there would be six lines of business:

• Consumer - BT Consumer will serve 10m households with a mix of broadband, telephony, TV and mobile services
• EE - it will retain its brand and serve consumers with mobile services, broadband and TV
• Business and Public Sector - a new division serving businesses and the public sector in the UK and Ireland, pulling together BT Business, EE's business division and parts of BT Global Services that are UK focused
• Global Services - serving multinational companies and financial services organisations with HQs in the UK and across the world
• Wholesale and Ventures - it will offer wholesale services to more than 1,400 communications providers and will include EE's "virtual network" business
• Openreach - it provides rival companies with access to BT's broadband infrastructure

Mr Patterson said: "We will operate a multi-brand strategy with UK customers being able to choose a mix of BT, EE or Plusnet services, depending on which suit them best."

BT's shares were up 2.97% in morning trading.