Outgoing BT CEO Gavin Patterson (pictured) noted a business transformation plan is running to schedule, with 2,800 job cuts in the first three quarters of its financial year, and broadly flat earnings in the final three months of 2018.
Patterson said there was “good momentum” behind its programme, which aims to snip £1.5 billion from annual operating costs, but admitted that in hindsight he would have started the process a year earlier.
In addition to cuts, BT’s three-year business plan includes a change of focus in its Consumer business towards sales of converged services, following the launch of fixed-wireless product BT Plus in May 2018.
Measures to transform the business were announced by Patterson in May, though a month later the company announced he would step down in the second half of 2018. His departure was subsequently delayed and former co-CEO of payment processor Worldpay Philip Jansen takes over as CEO tomorrow, having been executive director at BT since the start of 2019.
In a statement, Patterson said: “We continue to expect regulation, market dynamics, cost inflation and legacy product declines to impact in the short term before being more than offset by improved trading and cost transformation by our 2020/21 financial year.”
During the company’s fiscal Q3 earnings call (covering calendar Q4 2018) Jansen said he would spend the first few months of his tenure reviewing every aspect of BT’s business, strategy and plans. Though he voiced support for the direction the company was moving in and priorities outlined by his predecessor.
In line with comments from vendors and other operators in recent financial statements, BT reported slowing smartphone demand in the last three months of 2018, though price rises across its Consumer division boosted revenue in the segment.
BT’s fiscal Q3 revenue was down 1 per cent year-on-year to £17.6 billion. Net profit jumped 26 per cent to £1.7 billion, a rise attributed to the impact of a number of one-off items in both years.
Although the company did not provide adjusted net profit, stripping out one-off items, pre-tax profit was down 1 per cent year-on-year as gains in its Consumer unit and cost savings were offset by declines in Enterprise and wholesale broadband operation Openreach.Subscribe to our daily newsletter Back