Connect with us

Business

BT says Budget measures will cost it extra £100mn as it cuts revenue guidance

Published

on

Unlock the Editor’s Digest for free

BT has said it will be hit by an approximate £100mn increase in costs after the UK Budget while the telecoms group also cut its revenue guidance.

Chief executive Allison Kirkby, who is attempting to make savings as part of turnaround efforts, said the near-£100mn rise in the next fiscal year was predominantly related to the reduced threshold and increased rate of employer contributions for national insurance that were announced by chancellor Rachel Reeves last week.

Advertisement

Kirkby described it as “just a new inflationary pressure that we need to suffer in our business”, adding that the FTSE 100 company intended to offset all of it with “multiple levers” including accelerating its cost transformation plans, pursuing further workforce productivity measures and looking at the pricing of its products and services. She did not specify whether this meant price rises for consumers.

Kirkby told the Financial Times that she estimated the changes to NI accounted for about 70 to 75 per cent of the total cost increase, with the rest stemming from the rise in the minimum wage.

NI for employers will increase by 1.2 percentage points to 15 per cent from April and that the level at which employers start paying NI for workers will fall from £9,100 to £5,000. It was also announced last week that the national living wage would increase 6.7 per cent to £12.21 an hour from April.

BT employed 71,400 staff in the UK at the end of March.

Advertisement

Her comments came as BT on Thursday lowered its revenue outlook for the 2025 financial year to a decline of 1 to 2 per cent, down from previous guidance of adjusted revenue growth of up to 1 per cent.

It said the move primarily reflected “weaker non-UK trading including reduced low-margin kit sales, along with a softer environment in [the] corporate and public sector”.

Shares in BT were down 7.8 per cent to 131p in morning trading.

The rest of the company’s outlook was reiterated as it also announced an interim dividend of 2.4p per share.

Advertisement

BT reported a 3 per cent decline in adjusted revenue to £5.09bn and relatively flat adjusted earnings before interest, taxes, depreciation and amortisation of £2.07bn in the second quarter, compared with the same period last year.

During the group’s annual results in May Kirkby had announced an additional £3bn cost-savings programme by the end of its 2029 financial year, after completing a previous £3bn cost-savings target, and BT reported it had achieved £433mn in gross annualised cost savings during the first half of the year.

The group reported 181,000 further broadband line losses in its second quarter. It is facing competition from dozens of alternative network providers — or “altnets” — and Virgin Media O2 in the roll out of full-fibre broadband across the country.

Advertisement

BT’s reported pre-tax profit dropped 10 per cent to £967mn for the six months to 30 September compared with the prior year, which it said was primarily due to lower revenue and higher costs. Net debt rose to £20.3bn, from £19.5bn at the end of March.

Source link

Continue Reading
Advertisement
Click to comment

You must be logged in to post a comment Login

Leave a Reply

Travel

Best winter sun destinations that are less than six hours from the UK

Published

on

We've found the best winter sun that is both affordable, and nearby

SOMETIMES you just want to be somewhere hotter than the UK without having to hop on a long-haul flight.

Thankfully, there are some great destinations that aren’t too far away, and also won’t cost too much even if booking last minute.

We've found the best winter sun that is both affordable, and nearby

7

We’ve found the best winter sun that is both affordable, and nearbyCredit: Alamy

Using our many years of holiday experience, the Sun Travel Team has revealed their favourite winter sun destinations that are affordable – and all less than six hours from the UK.

Advertisement

Cape Verde – 5hr45 flight time

Cape Verde was my first foreign holiday after the dreaded 2021 winter lockdown. As soon as restrictions lifted, my then three-year-old, boyfriend and I jumped on a TUI plane for some much-needed sunshine.

At just under six hours, the flight time was probably the longest I’d
do with a pre-schooler but enough to find guaranteed winter sunshine – and Cape Verde pretty much guarantees sunshine.

Even in bleak midwinter, 25C is the average maximum temperature and the sun is strong, although you never get too hot because it’s also windy.

It’s also just one hour behind the UK, so there was no jet lag to contend with.

Advertisement

We stayed at the all-inclusive Riu Palace Santa Maria, on the south
west coast of the island of Sal.

The nearby seaside town of Santa Maria had a strip of lively bars and
cafes and a number of seafood restaurants offering the catch of the
day, as well as a great beach bar where you could enjoy excellent
cocktails with your feet in the sand for just £2.50.

Attractions are fairly sparse on Sal, but there was more than enough
to keep us busy for a week.

We paddled with baby sharks, took a catamaran cruise and explored the island on dune buggies, but there were plenty of watersports for the more adventurous too.

Advertisement

Caroline McGuire, Head of Travel

Cape Verde is perfect for a winter sun island break

7

Cape Verde is perfect for a winter sun island break
It's also just one hour behind the UK, so there was no jet lag to contend with

7

It’s also just one hour behind the UK, so there was no jet lag to contend withCredit: Alamy
The new winter sun destination 5 hours from UK & 27C in November – that TUI is launching ‘great value’ hols to this week

Marrakech – 3hr35 flight time

A place guaranteed to be warm in winter is Marrakech with temperatures above 20C – and it’s one of the most affordable to.

Advertisement

A visit to Marrakech comes with beautiful riad hotels, lined with multicoloured tiles and ornate decor and even pools in the middle – and can be found for just £35 a night.

Sure, the Moroccan coastline might temp you away for a winter beach break.

But the bustling city is the best to go pre-Christmas to stock up one some cheap presents.

Go empty suitcased and you’ll find hand blown glass cups, embroidered cushions and leather handbags often spotted on the UK high street in places like Anthropology and Accessorize but for so much less.

Advertisement

And with £16.49 flights thanks to easyJet, it’s cheaper than a train into London.

Kara Godfrey, Deputy Travel Editor

Marrakech is a great entry into Africa and one of the warmest to visit in winter without a long flight

7

Marrakech is a great entry into Africa and one of the warmest to visit in winter without a long flight
It's bustling but cheap with some amazing pre-Christmas shopping

7

Advertisement
It’s bustling but cheap with some amazing pre-Christmas shoppingCredit: Alamy

Lanzarote – 4hr flight time

I on my first winter sun holiday earlier this year and even though I’m late to the party, I’m a total convert after falling in love with Lanzarote.

I stepped off the plane in January and was met by a 20C heat – the ideal January pick me up, especially when flights are as little as £16.

And I was even happier when I went for a dip at the heated infinity pool at my hotel, the newly-opened Barcelo Playa Blanca.

The 180m-long main pool was also heated, which meant I could get my lengths in without getting chilly. 

Advertisement

The temperature was perfect for excursions too with four-hour boat cruises around the island, stopping near Playa de Papagayo, a golden sandy beach before a dip in the dip in the water and fresh paella.

Topped off off with evening drinks on a balcony looking out towards Fuerteventura, I didn’t once have to take out my big winter coat – which was exactly the plan.

Hope Brotherton, Travel Reporter

Lanzarote is still warm enough for a UK escape

7

Advertisement
Lanzarote is still warm enough for a UK escapeCredit: Alamy
The best way to catch some sun? An island boat trip

7

The best way to catch some sun? An island boat trip

Source link

Continue Reading

Business

How Scholz broke character. And the German coalition

Published

on

For years, German chancellor Olaf Scholz was blamed for his seeming inability to instil discipline in his warring cabinet, for his gnomic silence in the face of constant ministerial feuding.

This week, the sphinx finally spoke. And in a few words he brought down the government. 

Scholz appeared before reporters on Wednesday evening to announce he had sacked his finance minister Christian Lindner, in effect pulling the plug on his coalition. 

He described Lindner in ways that drew gasps of astonishment from those present: “selfish”, “irresponsible” and caring “only about the short-term survival of his own party”.

Advertisement

The question on many people’s lips was — what took him so long?

“He should have issued Lindner an ultimatum a long time ago,” said Wolfgang Schroeder, a political scientist at Kassel University. “Either you work with us constructively or we go our separate ways.”

Scholz’s coalition was never a particularly stable construct. It was a political experiment — the first three-way coalition comprised of the chancellor’s Social Democrats (SPD), Lindner’s liberal Free Democrats (FDP) and the Greens — parties that were awkward bedfellows from the very start.

The alliance was unveiled to much fanfare after elections in late 2021 and immediately launched a progressive programme that marked a fresh start after the inertia of the Angela Merkel era.

Advertisement

But its plans were quickly upended by Russia’s full-scale invasion of Ukraine in February 2022.

Scholz had predicted that Germany’s green transition would bring about a new “economic miracle”, with growth rates not seen since the boom years of the 1950s. Instead he found himself trying to figure out how to get Germany through the winter without Russian gas.

He and his ministers rose to the challenge, largely overcoming the energy crisis. They also reoriented German defence and foreign policy, in what Scholz dubbed a Zeitenwende, or turning point, agreeing massive supplies of weapons to Ukraine and a huge rearmament programme for the Bundeswehr. 

But the outward unity masked deep ideological fissures. The SPD wanted to shore up the welfare state, the Greens wanted action on climate change, and the FDP was obsessed with making sure Germany did not take on too much public debt.

Advertisement

“Our many political differences were papered over by all the money we had available,” Lindner said on Thursday. “That allowed us to reconcile political ideas that were essentially incompatible.”

Last year, that whole construct came crashing down.

In a bombshell judgment in November 2023, Germany’s constitutional court struck down Scholz’s budget on the grounds that it had violated the “debt brake”, the country’s constitution-enshrined cap on new borrowing. That opened up a massive fiscal hole that the coalition parties have struggled to fill.

Suddenly, the three parties were squabbling publicly over what to do. The SPD and the Greens wanted to suspend the debt rule to allow the state to borrow more money for Ukraine, and invest in infrastructure. Lindner, as head of the FDP, resolutely resisted those demands.

Advertisement

The tensions only increased as Germany’s economic prospects darkened. The country was grappling with falling output in its auto, chemicals and engineering industries. This autumn ministers downgraded their growth forecasts, admitting that Germany was now stuck in its first two-year recession since the start of the 2000s.

That played havoc with the government’s spending plans, forcing Lindner to lower his estimate for next year’s revenues. A €13.5bn hole opened up in the budget for next year. The bickering over how to bridge that gap became ever more feverish.

Lindner said on Thursday the parties had “always hoped” they could make progress through compromising with each other. But “the way the economy was and the way the public finances were heading, this limbo, this policy of the lowest common denominator, was no longer possible”.

Scholz tried for months to mediate between the feuding parties and steady the ship of state. On Wednesday he admitted how hard it had been to reach compromises. “Sometimes I went hard up against the limits of my political convictions,” he said.

Advertisement

“It’s hard to bang the table in such a disparate coalition — you end up smashing a lot of porcelain,” said Ursula Münch, director of the Academy for Political Education in Tutzing, Bavaria. “But he could have been a bit clearer about what he wanted to achieve, and communicated it better.”

At a town-hall meeting in Berlin in September Scholz was assailed by a kindergarten teacher who accused ministers of behaving like a “bunch of kids”. With a look of helplessness the chancellor asked him what his remedy was, adding with a smile: “I’m asking for a friend.”

As the economy worsened and the squabbling intensified, the coalition parties’ approval ratings slumped. All three performed disastrously in elections in eastern Germany in September that saw strong gains for populist parties of the right and left. A poll from late last month showed the combined ratings of the SPD, Greens and FDP were now less than that of the opposition Christian Democratic Union — Merkel’s conservative party.

Scholz’s aides routinely defended his style of government. His was a “steady hand on the tiller”, he was imperturbable and level-headed, and flexible enough to find solutions when his cabinet colleagues fell out. 

Advertisement

On Ukraine he had pursued what he himself called a “prudent” course, navigating between pacifists in his own party who craved a swift end to the war and the more gung-ho pro-Kyiv faction in the Greens and FDP that wanted a big increase in weapons supplies.

He has defended his consensual style. “There are some people, they’re amazing, they always say ‘onwards! Let’s man the barricades! Everyone after me!’” Scholz told a business meeting on Thursday morning, hours after sacking Lindner. “But the world isn’t like that, it’s never just one or two people leading. We all have to get along with each other.”

Robert Habeck, the Green economy minister, said on Thursday that anyone who thought the next coalition would be easier to manage was fooling themselves. “It’s not enough to have a parliamentary majority,” he told reporters. “You don’t have to be a clairvoyant to see that in future, even after the next election, it’s not automatically going to be easier.”

Advertisement

However, others think Scholz could have done more to ensure cabinet unity. “He was like a moderator on a panel, not a chancellor, and he just let things slide,” said Schroeder. “He was too reactive, mainly focused on keeping the show on the road.”

After his dismissal, Lindner also criticised Scholz’s leadership style. The chancellor lacked “the strength to enable a fresh start for our country”, he said, and his proposals for economic reform were “dull, unambitious”.

Scholz, who will now go down in the annals as one of the shortest-serving chancellors in Germany’s postwar history, once said that “whoever wants leadership from me will get it”: it was a pledge his critics say he never fulfilled.

Source link

Advertisement
Continue Reading

Money

SNG secures £100m AIB funding to boost affordable homes pipeline

Published

on

SNG secures £100m AIB funding to boost affordable homes pipeline

SNG aims to develop 25,000 affordable homes over the next decade.

The post SNG secures £100m AIB funding to boost affordable homes pipeline appeared first on Property Week.

Source link

Continue Reading

Business

More capital is not the answer

Published

on

More capital is not the answer

An interview with Yale’s Steven Kelly

Source link

Continue Reading

Money

Pair convicted over £1.5m crypto investment fraud

Published

on

Pair convicted over £1.5m crypto investment fraud

Two individuals have been convicted for their roles in a £1.5m investment fraud.

Raymondip Bedi, 35, and Patrick Mavanga, 40, pleaded guilty to fraud, money laundering and carrying out regulated activity without authorisation.

Mavanga also pleaded guilty to possession of false identification documents and perverting the course of justice.

The duo was part of a group that defrauded at least 65 investors out of £1,541,799.

Advertisement

Between February 2017 and June 2019, the group cold-called consumers, directing them to a professional-looking website where they were offered high returns for fake investments in crypto.

The jury at Southwark Crown Court were unable to reach a verdict on a third defendant, and they will face a retrial in September 2025.

A fourth defendant, Rowena Bedi, was acquitted of money laundering. A further individual, Minas Filippidis, is wanted in relation to the same offences.

Bedi and Mavanga will be sentenced at a later date.

Advertisement

The criminal proceeding was brought by the Financial Conduct Authority after the defendants were arrested last April.

The Financial Conduct Authority’s joint executive director of enforcement and market oversight, Steve Smart, said: “Bedi and Mavanga lured investors with promises of high returns on crypto investments, but their schemes were nothing but a callous scam.

“If you’re contacted out of the blue about an investment opportunity that sounds too good to be true, then it probably is. If you’re in any doubt – don’t invest.”

Source link

Advertisement
Continue Reading

Business

Big Tech’s shift on Trump

Published

on

Big Tech’s shift on Trump

Outrage over his 2016 election victory has given way to wariness but also anticipation of opportunities

Source link

Continue Reading

Trending

Copyright © 2024 WordupNews.com