BT revenues hit by 'eurozone weakness'

Shares in BT have fallen after the telecoms group reported a 6% drop in revenues due to weak economic conditions in key markets.

Shares closed down 3.3% after the company said revenues had fallen to £4.5bn in the three months to the end of June, compared with a year ago.

<link> <caption>BT said the drop reflected "tough conditions in Europe</caption> <url href="http://www.btplc.com/News/Articles/Showarticle.cfm?ArticleID=87392A50-3FA4-44FA-9D33-9213B5DF9051" platform="highweb"/> </link> and the financial services sector".

The company's profits rose by 8% to £578m.

BT's broadband customer base continued to grow, with the company adding 85,000 broadband customers during the quarter.

That was half of the net additions across the whole broadband market, BT said.

The company said it would be creating 2,000 jobs this year through recruiting engineers to support the further roll out of superfast broadband, and through opening four call centres.

A £27m deposit for its £738m deal for broadcast rights to Premier League matches put a dent in BT's free cash flow, from which late payments totalling £150m also took a bite.

The broadcast rights cover 38 live games, including 18 first picks, for the 2013/14 to 2015/16 Premier League football seasons.

"BT has had to put its progress on hold," said Richard Hunter at stockbrokers Hargreaves Lansdown.

Particular focus is on the Global Services division, where corporate spending sales were down sharply year-on-year as the ongoing global economic uncertainty places restraints on new investment."