BT's revenues slide as pandemic takes its toll

Global arm takes biggest hit in Q3 with 16 per cent revenue drop

Customer cancellations and delays due to the Covid pandemic have put a noticable dent in BT's third quarter results, with its IT services business suffering severe year-on-year declines.

The telecoms giant has reported a five per cent year-on-year drop in group revenues in its third quarter which it claims is a result of the pandemic.

It reported total turnover of £5.4bn for the three month period ending 31 December 2020. Of its numerous segments, it was its Global IT services unit that saw the biggest tumble with a 16 per cent revenue drop to £907m.

However, though the pandemic did play a part in the Global services decline, divestments across Spain, Italy, Latin America and France also contributed to the drop. Excluding these sold-off businesses and foreign exchange movements, Global revenues were only down 10 per cent.

BT claims that, despite the declines, orders for its Global division were up one per cent to £1.2bn in Q3.

"We continue to see a reduction in spending and a more cautious approach from our multinational customers resulting in cancellations and delays to purchasing cycles, which will negatively impact revenue and EBITDA in Q4 and subsequent periods," BT stated.

Overall, the firm was optimistic about the remainder of its fiscal year, as it sets up its new Digital hub, which will be responsible for IT, data and AI, BT's business transformation and product strategy.

"During the current Covid-19 pandemic, BT has continued to deliver for our customers and invest in our networks, our modernisation programme, and our products and services in recognition of the ever-increasing need for improved and faster connectivity. We delivered results in line with our expectations for the third quarter and remain on track to deliver our 2020/21 outlook despite even greater Covid-19 restrictions than previously forecast," stated CEO Philip Jansen.

"Looking further ahead our new Digital unit will enable us to accelerate our digital and business transformation programmes and to deliver digital platforms that bring together best-in-class services for our customers, further securing a brighter and more sustainable future for the group."