BT to hit earnings targets early - UPDATE

3rd Feb 2012 07:12

Telecoms giant BT saw profits jump 48% in the third quarter, as the firm announced that it would hit its 2013 earnings target a year early."We have delivered another quarter of growth in profits and cash flow despite the economic headwinds," said Chief Executive Ian Livingston.Pre-tax profits rose from £441m last year to £652m in the three months to December 31st. Over the first three quarters, pre-tax profits totalled £4,455m, up 18% on the previous year.Meanwhile, earnings before interest, tax, depreciation and amortisation (EBITDA) increased by 3% to £1,524m in the third quarter. According to broker Nomura, this was some 1.6% ahead of consensus estimates. Nine-month EBITDA were 3% higher than last year at £4,455m.Livingston revealed that BT now expects to achieve its EBITDA target of above £6,000m this year, rather than in 2013. Nomura said that "with consensus already sitting at £6.01bn for FY 12, we expect marginal upgrades to at least reflect the robust trading performance."However, revenue totalled £4,774m in the quarter, down 5% from £5,038m the year before and 3% lower on an underlying basis (which excludes transit). Nine-month revenues are 4% last year at £14,432m, down 1.8% on an underlying basis.Livingston added: "our investment to support our customers and improve our services has resulted in new contract wins around the world, with orders so far this year up over 50% in Asia Pacific and Latin America. In the UK, our fibre roll-out has accelerated bringing super-fast broadband within reach of over 7m homes and businesses and we remain the number one broadband retailer with over 6m customers."BT's free cash flow was £1,613m in the nine months to the end of 2011 and the firm expects it to hit £2,400bn by the end of this fiscal year (March 31st 2012).BC