BT reported mixed financial results as it revealed plans to acquire EE were making good progress.
Profits rose in the last three months of 2014, with EBITDA up two percent to £1.5 billion. However, revenues fell three percent to £4.5 billion.
The operator’s consumer arm was again the top performer; sales were up seven percent to £1.1 billion thanks to a 15 percent increase in broadband and TV revenue.
The company now has 2.7 million fibre customers, equating to 35 percent of its entire broadband subscriber base.
ARPU rose seven percent, while the number of people watching its flagship Premier League football offering was up 17 percent.
However, there were falls in each of BT’s other major business units.
Global Services saw revenues decline eight percent to £1.7 billion, which the operator said reflected the timing of contract milestones that benefited figures 12 months ago.
Revenue in the UK was down 18 percent as the public sector continued to rein in spending.
Sales at BT Business, which serves SMEs, fell two percent as companies continued to shun voice, while IT service revenues were flat.
BT Wholesale continued to struggle with sales down 10 percent, primarily because of falls in traditional calls, lines and circuits revenues.
Despite fibre broadband revenues increasing by more than a third, BT Openreach saw sales decline one percent due to regulatory price changes.
The company said it had passed 22 million premises with fibre broadband, with the number of homes and businesses connected reaching 3.7 million.
Meanwhile, CEO Gavin Patterson said further announcements about BT’s proposed acquisition of EE would be made in due course, with “good progress” being made on due diligence.
BT entered into exclusive talks with Orange and Deutsche Telekom about a £12.5 billion deal last December.
The CEO added: "In the meantime, our Consumer mobile launch plans remain on track.”
Patterson also provided an update on BT’s pension liabilities. He said: “I am pleased that we have agreed the 2014 triennial funding valuation and recovery plan with the Trustee of the BT Pension Scheme.
“The funding deficit is £7.0bn at 30 June 2014, an increase from 2011 reflecting the low interest rate environment.
“Over the next three years we will pay £2.0bn, which is less than we paid over the previous three years.
“We have agreed a 16-year recovery plan reflecting the strength and sustainability of our future cash flow generation.”