BT has cut more than 11,700 jobs over the past 12 months, reducing its UK workforce by 11% to 90,000 employees. Chief Executive Allison Kirkby plans to reduce roles further, targeting a headcount of between 65,000 and 70,000 by 2030.
Restructuring delivers savings but shrinks workforce
The job reductions are part of a cost-cutting programme that has proven successful in boosting profits. Pre-tax profits rose 12% to £1.1 billion for the six months to September, while revenue increased just 1% to £8.8 billion. The restructuring has delivered £312 million in annual savings as the company simplifies its operations.
Despite the workforce reductions, BT recently rescued rival TalkTalk out of administration. The buyout is expected to cost around £400 million this financial year, and BT is now responsible for maintaining services for 2.5 million TalkTalk customers.
Financial pressures persist despite profit growth
While short-term profits have been helped by the role reductions, the company's finances remain under pressure. Normalised free cash flow, the money remaining after running and investing in the business, plummeted 59% to £236 million. Debt has risen by £1 billion to £21 billion.
Kirkby said the broadband company was making progress despite the challenging market. "Our UK-centric strategy and transformation is clearly delivering with £312 million of annualised savings achieved in the first half, as we continue to simplify and modernise," she said.
Dividend hiked as cost-saving targets set
BT maintained its full-year forecasts and hiked its interim dividend by 2% to 2.5p per share. The continued restructuring is targeting £3.5 billion of gross annualised cost savings by the end of the decade.
