Annual profits

BT posts rising annual profits.

LONDON – British telecommunications and broadcasting company BT, which is buying mobile operator EE, reported higher annual profits on Thursday due to strong demand for its broadband internet services.

Underlying profit, or earnings before interest, tax, depreciation and amortization (EBITDA), rose 3% to £6.3 billion ($9.5 billion, €8.4 billion) in the 12 months ending March, compared to the previous 2013/2014 financial year, BT said in an earnings release.

Pre-tax profit rose 14% to £2.645bn, but revenue fell 2% to £17.851bn.

BT added that it gained 121,000 retail broadband customers in the fourth quarter, representing almost 50% of growth in the UK broadband sector.

This compared to 170,000 new subscribers for the same period a year earlier.

“It has been a groundbreaking year for BT, in which we have taken key decisions and announced major investments to support the future growth of the business,” Chief Executive Gavin Patterson said.

“Earnings before tax and free cash flow both increased strongly and we met or exceeded the guidance we set at the start of the year.”

The company had agreed in February to buy EE for £12.5 billion in a cash and share deal partially funded by a £1.0 billion rights issue.

BT shareholders approved the deal last week, which is now awaiting regulatory approval.

EE is a British brand of mobile phones operated by the French company Orange and Deutsche Telekom in Germany.

Earlier this year, meanwhile, BT and broadcast rival Sky won the UK TV rights to show Premier League games for three seasons at a record cost of £5.1billion.

Sky will pay £4.2 billion for five of the seven packages and BT almost £1.0 billion for the rest.

BT entered the live TV sports streaming market in 2013 with the launch of its BT Sport brand.

“Our BT Sport TV channels are now in over 5.2 million homes, with the customer base growing further during the quarter,” Patterson added.

“We are delighted to have secured FA Premier League football rights for a further three years and an extension with Aviva Premiership Rugby for a further four years.”

AFP