BT quarterly profit surges as EE deal boosts revenues

Shares in BT Group jumped over 3% early on Thursday (28 July), after the telecom giant's first quarter results beat expectations as the acquisition of EE earlier this year boosted revenues.

In the three months to the end of June, the FTSE 100-listed company saw earnings before interest, taxes, depreciation, and amortisation (EBIDTA) jump 25% year-on-year to £1.8bn. Meanwhile revenue, excluding currency volatility and the impact of acquisitions and disposals, surged 35% to £5.78bn.

In January BT acquired EE, Britain's biggest mobile company, for £12.5bn. BT Group Chief Executive Gavin Patterson said the results in the three-month period vindicated the acquisition.

"Our integration of EE is progressing well, alongside our business reorganisation that took effect on 1 April. EE performed strongly, both financially and commercially, and our customers are seeing the initial benefits of our acquisition with BT Sport now available to EE pay monthly customers."

The positive results come just two days after Ofcom, Britain's communication regulator, told BT Group its Openreach division should operate as an independent company within the telecoms giant, in a bid to avoid the complete break-up of the company and to improve broadband coverage.

BT's rivals had lobbied the regulator to completely separate Openreach from BT, arguing it would be the best course of action in the interest of competition, but the regulators dismissed those calls.

However, it recommended that Openreach, which owns the pipes and telephone cables the majority of UK homes and businesses use to access the broadband and phone network, should take control of its customer relations and establish its own board.