BT to axe 4,000 jobs and cuts boss's bonus

BT is to cut 4,000 jobs and admitted earnings will fall this year after its annual results revealed profits that fell below expectations.

Pre-tax profits for the year came in at £7.6bn, up 18 per cent on 2015 but below the expected £7.9bn. BT added this will likely fall to £7.5bn this year.

Remedial action includes the cull of 4,000 jobs in its global operations, for which The Guardian says it has booked a restructuring cost of £300m.

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Executive bonuses have also taken a hit. Chief executive Gavin Patterson's total package has fallen 74 per cent, from £5.3m to £1.3m, and former finance director Tony Chanmugam's from £2.8m to £258,000.

BT was "riding high in 2016", says the Financial Times, but suffered a "tumultuous" start to the year, with an accounting scandal in its Italian business, related to overstatement of profits amounting to in excess of £500m, and a battle over its infrastructure arm Openreach, which has left it facing a £342m bill over compensation payout cuts.

The company also revealed today it only added 11,000 pay-TV customers in the fourth quarter, which Patterson admitted was "soft". Pay TV had been one of the powerhouse divisions last year.

In addition, there has been a drop in new public sector contracts since the Brexit vote last year.

BT shares fell 3.5 per cent in morning trading to 301p per share.

Investors would also have been put off by its announcement that dividend growth would be cut from ten per cent next year.