Phone Giant BT (NYSE:BT) shares plunged 20 percent due to the warning the company issued warning share holders regarding poor performance in its global services unit. BT Finance Director Hanif Lalani will be the new Global Services divisions head after the resignation of Francois Barrault.
Group chief executive Ian Livingston said that BT’s global service division results “are particularly disappointing” he also added that the quarterly earnings for the division of some £120 million would be “significantly below expectations”.
Mr Livingston made it clear that they acknowledged the unsatisfactory performance in the group and that they will be committed in taking decisive action to rectify the situation, adding that the they will also speed up plans to implement cost efficiency plans for the division.
Analysts from Cazenove said that BT is likely to remain depressed for a while so they now have to make the move to underperform.
BT shareholders will be concerned about the risks of the ailing UK economy and what effect this will have on BT’s future operational performance, also in recent months the pension schemes funding position looks like it’s taken a sharp hit. In morning trade shares in BT were down 29p to 112.8p. We will see BT’s half-year results on November 13.
Source: BBC