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More woes for telecoms giant

BT profits dive 37% as Italy scandal weighs on group

BT SportProfits at telecoms giant BT dived 37% to £526 million in the last quarter, adding pressure on the board after the revelations over an accounting scandal.

Sales for the three months to the end of December rose 32% to £6.1 billion despite the irregularities in its Italian division costing it more than £500m.

On Tuesday, BT was forced to write down the value of its Italian unit after years of overstating profits. Corrado Sciolla, head of continental Europe, is leaving the business.

More positively, BT said its Openreach division, which includes broadband customers, has halved the number of missed appointments year on year.

Gavin Patterson, BT’s chief executive, said: The good progress we’re making across most of the business has unfortunately been overshadowed by the results of our investigation into our Italian operations and our outlook.

“We’ve undertaken extensive investigations into our Italian business, including an independent review by KPMG, and I am deeply disappointed with the unacceptable practices by some that we’ve found. 

“This has no place at BT, and it undermines the good work we’re doing elsewhere in the Group.  We are committed to ensuring the highest standards across the whole of BT.

“We face a more challenging outlook in the UK public sector and international corporate markets but we’ve seen record growth at EE, strong momentum in Consumer, and our highest ever fibre net connections in Openreach.

“Customer experience remains a top priority. EE is now answering 100 per cent of its customers’ calls in the UK and Ireland.  In Openreach, missed appointments have halved year on year. We’ll continue to invest to ensure our service levels improve and that our customers see the benefit.

“We are pushing ahead with reforms at Openreach, particularly on governance and customer service and continue to believe an agreement can be reached with Ofcom on its Digital Communications Review.

“We think these changes address Ofcom’s concerns and can form the basis for a fair, proportionate and sustainable settlement.”

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