BT is to cut a further 15,000 jobs, representing 10 per cent of its workforce, and has announced a £134m annual loss in its financial results.

BT’s group-wide turnover for the year to 31 March 2009 increased three per cent to £21.4bn, however the firm sank to a £1.28bn loss for the last three months.

The telecoms giant laid the blame firmly at the door of BT Global Services. The division made an operating loss of £198m for the quarter on a turnover of £2.36bn.

Annual turnover for the BT Retail unit fell to £8.47bn compared with £8.48bn
a year earlier.

BT’s Wholesale unit also experienced a revenue decline of six per cent to £4.7bn.

Ian Livingston, BT's chief executive, said the performance of BT Global Services was unacceptable: “Three out of four of BT's lines of business have performed well in spite of fierce competition and the global economic downturn.

“However, this achievement has been overshadowed by the unacceptable performance of BT Global Services and the resulting charges we have taken. During the year we have changed the leadership of BT Global Services and started to turn the division around.”

Livingstone added: “With a recovery programme for BT Global Services in place and our heightened focus on costs and customer service, we now want to accelerate our plans for our future networks.

“In the coming year we will extend the record of operational delivery already demonstrated in three out of our four divisions right across the group.”

Livingstone said he expects BT to deliver a net reduction in operating costs and capital expenditure of well over £1bn in 2009/10. This will enable the firm to generate free cash flow, before any pension deficit payments, in excess of £1bn in 2009/10 and beyond.