BT posts £2.8bn quarterly loss

BT's announcement that it was launching a massive sale of new shares overshadowed the reporting of a huge £2.8bn ($4bn) pre-tax loss for the fourth quarter that pushed the company into its first-ever annual loss.

In its results statement, the UK's former telecoms monopoly said it was taking a £3bn charge in light of the poor performance of its German subsidiary, Viag Interkom.

It also said Concert - a global corporate telecoms joint venture with AT&T - had disappointed, with BT's 50% stake returning an £89m loss in the quarter.

Analysts said the admissions provided yet more damning evidence of the collapse of BT's international ambitions.

Higher interest charges

BT said its losses in the final quarter of its 2000-01 business year were mainly due to higher interest charges on debts built up acquiring new businesses and third-generation mobile phone licences, as well as the losses at Concert.

Group turnover was up 14% to £5.4bn, mainly because of the acquisitions.

BT's shares of international joint ventures produced an operating loss of £34m for the fourth quarter.

This was a modest improvement on the £40m operating loss recorded in the same period of 2000, and mainly reflected good results from BT's Japanese operations - sold last week to rival Vodafone.

Concert sale talks

Concert was the big loser, racking up a loss of £89m after a profit of £69m last time.

BT on Thursday said it was discussing options for Concert that included selling its 50% stake to its partner AT&T.

"Such a transaction could include all or a substantial portion of BT's business services operations, including BT Ignite and BT's interest in Concert," BT said in a statement.

"As possible alternatives to such a transaction, BT has also been considering a narrowing of Concert's business scope, as well as its termination as a joint venture."

Sharp reverse

Concert, set up in the late 1990s, had been viewed in its early days as blazing a trail for telecoms firms seeking a global presence.

But its fortunes have suffered a sharp reverse, with Concert officials complaining they have often had to compete for business with each of their shareholders.

Analysts say BT has also found itself outmanoeuvred internationally by nimbler rivals such as Vodafone - which focuses on the wireless business - and France Telecom, which, invigorated by privatisation, has presented investors with a more coherent and focused strategy for international growth.

For its full 2000-01 business year, BT achieved a pre-tax loss of £1bn on turnover of £20.4bn - its first-ever annual loss.

No dividend will be paid for the year.

In other comments, BT said its Cellnet mobile phone division had increased its customer base to 11.2 million at 31 March, up 3.8 million from the same time last year.