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26/07/2001
Union issues warnings over BT profit loss
Despite making some headway in reducing its amount of debt, British Telecommunications (BT) has revealed yet another quarterly drop in profits.
Announcing figures for the second quarter, Chairman Christopher Bland said that BT had succeeded in reducing debt from the “unsustainable” level of almost £28 billion, as recorded in March of this year. However, the company’s underlying profits have fallen to £186 million, in comparison to the company’s performance in the same quarter of 2000 which saw BT report a figure of £637 million.
BT have attributed the drop in profits as directly resulting from the intensive strategy the company has employed to reduce its debt, which included a discounted issue of new shares in June, and a spate of asset sell-offs, which raised £6 billion over the quarter.
The company is set to fully demerge into two separate business entities later this year, with BT Wireless set to take care of the company’s interests in the mobile sector, and Future BT comprising the rest of its present operations.
BT Wireless has already announced operating losses of £95 million, prompting criticism from communications union CWU, who warned that chasing short-term financial benefits in form of a spin-off process meant that BT could be “staring into the abyss”.
(CL)
Announcing figures for the second quarter, Chairman Christopher Bland said that BT had succeeded in reducing debt from the “unsustainable” level of almost £28 billion, as recorded in March of this year. However, the company’s underlying profits have fallen to £186 million, in comparison to the company’s performance in the same quarter of 2000 which saw BT report a figure of £637 million.
BT have attributed the drop in profits as directly resulting from the intensive strategy the company has employed to reduce its debt, which included a discounted issue of new shares in June, and a spate of asset sell-offs, which raised £6 billion over the quarter.
The company is set to fully demerge into two separate business entities later this year, with BT Wireless set to take care of the company’s interests in the mobile sector, and Future BT comprising the rest of its present operations.
BT Wireless has already announced operating losses of £95 million, prompting criticism from communications union CWU, who warned that chasing short-term financial benefits in form of a spin-off process meant that BT could be “staring into the abyss”.
(CL)
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