Cable & Wireless sees full-year profit slump 5.7 percent
Today Cable & Wireless announced that its full-year profit dropped 5.7 percent compared with the previous year, which has the United Kingdom’s second-largest phone company mulling whether to sell some of its assets or split the company up to increase shareholder value.
Cable & Wireless – which provides voice, Internet and wireless services to business and residential customers – reported a profit of $323 million for the year, ended March 31. Cable & Wireless’ profits were bolstered last year by the $300 million sale of Batelco in Bahrain.
The company’s year-end revenue dropped 5.8 percent to $6.17 billion. Cable & Wireless’ earnings before interest, taxes, depreciation and amortization increased 33 percent, to $1.08 billion, while sales fell by 5.9 percent.
In the Europe, Asia and United States business, we have returned to revenue growth with over 40 percent of revenue now accounted for by IP, data and hosting products,” said Cable & Wireless Chairman Rich Lapthorne. “Gross margin is now above 40 percent, and operating costs are below 30 percent of revenue after cost savings of more than 100 million pounds ($195 million) achieved in the year.”
During a conference call today, Finance Director Tony Rice said the company could sell off some of its businesses, borrow money to return capital to shareholders or break itself up.
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