Cable and Wireless ups profit guidance

08-11-2006

Cable and Wireless ups profit guidance
Telecoms group Cable & Wireless (C&W) has raised its annual profit guidance after reporting better-than-expected first half results.

In a statement, the company said that it now expected to report underlying profits of between £145 million and £150 million this year, compared to an earlier estimate of between £140 million and £145 million.

C&W raised its profit expectations for the year after posting a ten per cent increase in earnings before interest, taxation, depreciation and amortisation (Ebitda), during the six months to September 30th.

Ebitda earnings over the period rose to £221 million, boosted by a strong performance from the telecom provider's international business.

C&W said that it had subsequently decided to raise its interim dividend by 21 per cent to 1.7 pence.

News of the company's better-than-anticipated profits come in the middle of a major restructuring programme which is being conducted by the UK arm of the telecoms group following a series of profit warnings.

Commenting on the company's first-half performance, C&W chairman, Richard Lapthorne, said: "The group has made good progress in the first half. The international business continues to perform well and the UK is executing its turnaround plan successfully.

"As a result of the actions we've taken over recent months, we expect to see further progress in our performance in the second half," he added.

Under the restructuring plans, C&W plans to focus on the wholesale telecoms supply market and to reduce its corporate customer base to all but its most profitable customers.

C&W confirmed that its number of UK customers in the UK had fallen to 14,566 by the end of the first half, ahead of a target of 18,000 and compared to 21,000 in March.

Chairman of C&W's UK business, John Pluthero, said he was "happy" to restate the group's aim of creating a UK business with £2 billion in revenues.


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