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BT Global Services loses chief, issues profit warning

Colin Barker ZDNet.co.uk

Published: 31 Oct 2008 16:58 GMT

The head of BT Global Services, Francois Barrault, has resigned, ahead of the company's results announcement on 13 November.

BT would not say why Barrault had left the company.

Also on Friday, BT Global Services, one of BT's four main divisions, issued a profit warning.

Profits for the division were initially predicted to be £200m this quarter, but that forecast has now been downgraded to £120m.

"We expect revenue growth in this division will remain strong, up 15 percent year on year, but EBITDA [earnings before interest, taxes, depreciation and amortisation] of around £120m will be significantly below expectations," BT said in a statement.

"The fall in EBITDA is due to slower-than-anticipated delivery of efficiency savings and the continued decline in higher-margin UK business," the statement added.

Besides commercial customers, many of which use BT for their telephone and communications requirements, Global Services also handles a lot of business with the UK government and runs large parts of the IT involved in the health services and the NHS National Programme for IT.

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In his statement on the resignation of Barrault, Ian Livingston, BT's chief executive, underlined the importance of Global Services' results performance to the company as a whole. "Continuing strong revenue growth shows the tremendous potential of this market, and demonstrates how important the services we provide are to our customers around the world," he said.

In the statement, BT said that it expects its three other main divisions — BT Retail, BT Wholesale and Openreach, as well as other operations — to be "in line with or ahead of expectations".

A BT spokesman said that, except for the Global Services profit warning, no other comment would be forthcoming ahead of the full results meeting in November.