BT HAS ANNOUNCED plans to axe 4,000 jobs as part of a restructuring programme that will save it around £300m over the next two years, after reporting that its annual profits dropped dived by 19 per cent.
However, the company has softened its stance on rolling out fibre-to-the-premises, in a high-cost project that would see the copper 'last mile' ripped out of the ground and sold for scrap, and replaced with much more reliable fibre.
In its latest financial results, BT reported that revenue for the year to 31 March rose 27 per cent to to £24.06bn, but profits came came in at £2.4bn, down 19 per cent year-on-year.
The noted that it had endured a challenging 12 months. Problems it faced include a £42m fine from regulator Ofcom for its failings around 'deemed consent' in its Openreach division, as well as the subsequent £300m compensation bill.
BT's Italian business was also hit by a major accounting scandal, which all have led to the company not handing bonuses to BT Group's chief executive Gavin Patterson, or to outgoing finance director Tony Chanmugam.
Patterson will miss out on a bonus of more than £3m, while Chanmugam would have received a bonus of about £1m, as he departed midway through the year.
The company claimed that a "cost transformation programme" will simplify its central group functions, its internal technology, and its service and operations unit, while the restructuring of BT Global Services will involve clarification of accountabilities, removal of duplication, and the removal of around 4,000 roles, mainly from managerial and back office areas.
"We anticipate these transformation programmes will save in total around £300m over two years, with a restructuring charge of around £300m over the next two years, with most of this being incurred in 2017/18," the company said.
"The cost savings will provide headroom to offset market and regulatory pressures and support increased investment in delivering great customer experience and leading networks," it added.
The company also announced a consultation for ways in which it could deliver universal broadband coverage.
It said that a separate consultation will look into the potential benefits and costs of a large-scale fibre-to-the-home (FTTH) deployment - something that the company had seemingly always been opposed to, citing both a lack of demand and the extortionate costs of such a project.
"We're ready to invest in the UK's digital infrastructure, in continued improvements in our customer service, and in new technologies to further enhance customer experience," said Patterson.
"To that end, Openreach has today announced that it is consulting with customers and industry stakeholders on the business case that could support better rural broadband and a large scale fibre-to-the-premises rollout across the UK," he said. µ
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