BT rings up 21% surge in profits

BT IRELAND’s first-half profits increased by 21%, on a year-on-year basis, leading the company to maintain that it is building on its aim to become the leading networked IT services provider in the Republic.

While gross margin improved by 7% during the six months to the end of September, revenue for the group’s Irish division fell by 3% to £397.8 million (€442.2m). However, despite this, revenue has been improving on a quarterly basis – down by 5% in the first quarter and down by 2% in the second.

“Our strategic shift to higher value managed services and our relentless focus on cost management has enabled us to make outstanding progress on profitability,” BT Ireland chief executive, Chris Clark said yesterday.

Mr Clark added that the company remains optimistic about its outlook for Ireland and will continue to invest. While its cost base here fell by 16% in the first half, its capital expenditure increased (although the company wouldn’t say by how much).

BT Ireland recently shifted its focus solely towards the corporate market – after offloading its consumer and small business divisions to Vodafone Ireland – and has picked up a number of new business wins in recent months with the likes of UTV and Coillte.

BT Ireland also said that it hoped to increase its number of local loop exchanges in Ireland from 22 to 66 by March 2011, which would enable it to reach 65% of the online population.

On a group wide basis, BT reported a 6% year-on-year drop in first half group revenues to £5.12bn (€5.7bn) and a 2% decline in EBITDA to £1.43bn (€1.59bn) and an interim dividend of 2.3p.