Live news: British pound falls after BoE raises benchmark interest rate

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BT will increase its cost savings target by a fifth and continue inflation-linked price increases in 2023 for most customers as it seeks to mitigate higher energy and inflationary costs.

“We remain focused on modernizing and simplifying the BT Group,” BT chief executive Philip Jansen said in a statement on Thursday.

“Given the current inflationary environment, including the significant increase in energy prices, we need to take additional action on our costs to maintain the cash flow needed to support our network investments,” said he declared.

BT has revised its savings target from £2.5bn to £3bn by the end of 2025.

BT is embroiled in a pay dispute with staff, led by the Communications Workers Union, over a proposed pay package in April. Last month, about 40,000 employees downed tools for four days, calling on Jansen to return to the bargaining table to talk pay.

The group released second-quarter revenue and profit on Thursday broadly in line with analysts’ estimates, supported by its consumer and Openreach divisions, which both implemented inflation-linked price increases in April.

Britain’s former monopoly reported flat revenue in the quarter from a year earlier at £5.24bn, in line with consensus forecasts, and a 5% rise in adjusted profit before interest, tax , depreciation and amortization at £1.97 billion, slightly above estimates.

Profits in the consumer division rose by a fifth to £670 million, offsetting an 18% decline in adjusted EBITDA in the enterprise division.

Most telecom groups implemented price increases this year that factored inflation into their mobile and broadband rates. BT has chosen to increase its mobile and broadband prices in line with the consumer price index, plus an additional 3.9%.