Shares in BT Group dropped on Friday after the telecoms group reported falling third-quarter revenue and profit due to higher investment and pension costs and rising business rates.
The company reported that revenue in its October-December period fell 3% to £5.97bn, while underlying revenue fell 1.5%. Adjusted earnings before interest, tax, depreciation and amortisation, fell 2% to £1.83bn. Both metrics failed to match market expectations.
The company cited the lower profit was caused by costs related to the expansion of its fibre optic networks, along with higher business rates and pensions costs.
Net cash flow from operations rose by £81m to £1.596bn.
Gavin Patterson, chief executive (left), said: "Our third quarter financial results are broadly in line with our expectations and we remain confident in our outlook for the full year.
"We continue to improve our customer experience metrics across the Group, with our sixth successive quarter of improved customer perception.
"We are delivering against our strategy, capitalising on opportunities and responding to market challenges with a robust set of actions. Looking ahead, we're confident in the steps we are taking to improve the performance of BT for all our stakeholders."
"The shares have underperformed the market over the past year," said Ian Forrest at The Share Centre.
"That is a reflection of the fact that while some parts of the consumer-facing businesses seeing good growth, such as EE, the company is clearly under pressure on a number of fronts, so we see the shares as no better than a ‘hold’.”
Investors were not impressed, however, and the shares fell 5.88% to 240.95p in mid-morning trade on the London Stock Exchange.