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Global Services star performer for BT in Q2

Alex Scroxton

BT has posted a slight decline in sales for its second quarter to the end of September, although both EBITDA and pre-tax profit showed improvement, up 3% and 13% respectively after a strong performance from problem child, BT Global Services.

The communications giant posted total adjusted revenues of £4.97bn during its second quarter, down 3% on the year-ago period, while EBITDA hit £1.45bn and pre tax profit rose to £496m.

BT Global Services saw its order intake up 50% at £2.1bn after the business hooked a number of new customers and scored major contract extensions with the MoD and Network Rail.

Its sales hit £1.99bn, down 2%, but EBITDA climbed 45% following a successful cost reduction drive and operating losses of £41m represented a vast improvement on this time last year.

BT Retail saw sales slide 4% to £1.92bn, with business sales flat, reflecting growth in IT services and mobility revenues, but consumer sales falling by 6% as competition in the home communications market continued to take its toll. It was nevertheless a good quarter for broadband, with 114,000 net additions.

BT Wholesale saw a 5% slide in sales to £1.05bn, reflecting reductions in low-margin transit sales and regulatory charges, while Openreach reported flat year-on-year sales of £1.23bn,

CEO Ian Livingston hailed "significant progress in improving profitability and cash flow", saying that the quarter laid the foundations for "revenue growth in 2012/13".

"We have increased our EBITDA outlook for the year and now expect to hit our £2bn free cashflow target two years early," he added.


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