British telecoms operator BT on Thursday announced a very small rise in revenue, cut costs and raised its prices in the face of inflation, and saw its net profit double, notably inflated by a tax refund. After making £1.7bn of savings since April 2020, the group said on Thursday it wanted to accelerate cost cuts, worth £3bn by the end of the 2025 financial year, up from £2.5bn previously announced .
These cost reductions are achieved in particular through the simplification of its offers and procedures, greater automation or consolidation of sites in a context of price increases.significantly higher than expected“, according to a press release.”In light of the current high inflation environment, including the significant increase in energy prices, we need to take further steps in relation to our costs“, explained Philip Jansen, general manager, quoted in the press release.
BT fell 8.30% to 117.15 pence on the London Stock Exchange shortly after 10am on Thursday. 09:00 GMT. Revenue at BT, which has struggled to recover from the pandemic, rose 1% to £10.4 billion in the period to the end of September. Profit after tax rose to £893m, thanks mainly to a £200m tax refund. The company’s revenue was mainly driven by “inflation-related price increasesin its subsidiary Openreach, responsible for the roll-out of fiber in the UK and in services to individuals.
“Struggling with rising inflation and fears of a recession“BT sees itself forced”raise its cost-savings target to weather headwinds in the economy and pay for the build-out of its fiber networkcommented Victoria Scholar, analyst at Interactive Investor. BT has also had several days of strike action since the summer, the company’s first walkout in 35 years, following a call by the Communications Workers Union (CWU) for better pay in the face of inflation that has topped 10% in the country.
BT announced in May that it was joining forces with US media and streaming giant Warner Bros. Discovery to bring together their sports TV offering in the UK and Ireland into a new company. Patrick Drahi, head of the telecom and media group Altice, became the operator’s largest shareholder in June 2021 with 12.1% of the capital. In December, he increased his stake to 18%.