Cable and Wireless reveals revenues fall

Telecoms group Cable & Wireless (C&W) today said revenues at its UK business fell 4% to £390m (€560.9m) in the final three months of the year.

The quarter-on-quarter decline was stronger than the 1% fall in sales achieved in total by all C&W’s businesses – down to £808m (€1.2bn) from £820m (€1.2bn).

The London-based company has been battered by tough competition in its home market and recently announced plans to further restructure the UK operation.

C&W said revenues for the business and enterprise parts of its UK division proved stable but that sales in carrier services had been hit by a cut in some call charges imposed on mobile phone operators by regulator Ofcom.

Today’s figures come two months after C&W announced a £14m (€20.1m) rise in underlying half-year profits to £199m (€286.2m), despite a fall in revenues to £1.62bn (€2.3bn) from £1.73bn (€2.5bn) a year earlier.

The company said today it maintained expectations that profits for the second half would be a “reasonable reflection” of that achieved in the first half. Shares rose 2% as analysts said the figures were slightly stronger than hoped.

Chief executive Francesco Caio said the third quarter results carried no surprises and demonstrated “solid progress” in the group’s transformation.

He added that all businesses were pursuing profitable revenue streams and that there had been an encouraging roll-out of broadband services in the UK.

The national telecoms businesses – mainly based in the Caribbean – achieved a performance in line with expectations, helped by a robust performance from mobile phone operations. It said it was still assessing the impact of the Indian Ocean tsunami on its business in the Maldives.

When compared with a year earlier, C&W said revenues of £808m (€1.2bn) represented a fall of 4%. In the UK, the decline was 6%.

As part of changes announced in November, Mr Caio said he would take direct control of the UK arm as he looks to drive expansion into areas such as broadband.

He also pledged to reorganise the UK business into customer-focused segments and create a single unit to deal with operational activities.

Since his appointment 18 months ago, Mr Caio has pulled C&W out of the US market in order to focus on the UK and its national telecom businesses.