BT full-year net profit up 46 pct

AP News
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Posted: May 12, 2011 4:24 AM
BT full-year net profit up 46 pct

Telecommunications company BT Group PLC on Thursday reported a 26 percent increase in net profit in the three months ending March 31, finishing a year in which cost cutting helped boost the company's profit by 46 percent.

BT, a major provider of broadband and landline telephone services, said profit in the fourth quarter was 473 million pounds ($772 million) compared to 209 million pounds a year earlier.

For the full year, BT's net profit was 1.5 billion pounds compared to 1.03 billion pounds a year earlier. Revenue was down 4 percent to 20.1 billion pounds.

BT said it had shaved 1.1 billion pounds from costs during the year, ahead of its planned savings of 900 million pounds.

The full-year dividend payout was raised to 7.4 pence per share from 7 percent from a year earlier.

BT Group shares were down 1.1 percent at 199.6 pence in early trading on the London Stock Exchange.

Keith Bowman, analyst at Hargreaves Lansdown Stockbrokers, said BT has more work to do.

"Overall revenues remain in decline, a position which at some point will need to be reversed, whilst the appropriate business model across the broader telecoms, media and technology arenas remains fluid and uncertain," Bowman said.

Analysts at Investec Securities said in a research note that cutting costs can only go so far, but noted that BT is now forecasting underlying revenue growth in 2013, which should "help to convince skeptics that there is more to this stock than profit growth being based on cost cutting,"