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15:24 - 15-May-2008
He also predicted that under new chief executive Ian Livingston the group would improve revenues and earnings in the current financial year.
Revenues rose by 2% in the quarter to end-March, when most analysts had expected them to be flat, and pre-tax profits were up 3% at £714m. Verwaayen said the growth had come particularly from business customers: 'Large and small they now all see the convergence of IT and communications and realise we can satisfy both.'
But he said consumers were becoming more demanding, wanting more technology. Recent launches like BT Broadband Anywhere had seen strong sales.
Verwaayen had good news for the City with a promise of more cost savings at around £700m and lower capital expenditure of around £3.1bn in the current financial year. Both numbers were better than analysts expected and reflect a revised strategy for the group's so-called 21st Century Network which is aimed at bringing much faster internet speeds to all customers by 2011.
Verwaayen said: 'We will make it customer-driven rather than technology-driven which will be much more efficient.'
For the year to end-March, BT's profits were flat at £2.5bn on revenues 2% higher at £20.7bn. The dividend for the year rises by 5% to 15.8p a share.
Chairman Mike Rake paid tribute to Verwaayen, saying he had 'transformed' BT from a fixed line business into a software driven global communications company.
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The motorist feels somewhat battered from all sides, seeing the oil companies going off with cash in their pockets and the Treasury filling its coffers
Edmund King, President of the AA
