BT unveiled a "near halving of profits and thousands of job cuts" and stripped CEO Gavin Patterson of his annual bonus as the company "grapples with the fallout from an accounting scandal in Italy and a big fine from Ofcom for overcharging rivals for access to its broadband network," according to Robin Pagnamenta of the LONDON TIMES. The telecom said that Patterson would no longer receive a £338,398 ($436,000) bonus for '16-17, "citing the fraud at BT Italia," issues relating to Openreach and "significant challenges" faced by the company. Former BT CFO Tony Chanmugam, who left last summer, will also be stripped of his £193,412 ($249,000) bonus for '16-17. The news came as the company announced a 48% slide in pre-tax profits to £440M ($567M) for the three months ended March 31. Revenues rose 10% during the period to £6.1B ($7.9B). Patterson said that it had been a "challenging year." He also set out details of an "accelerated" cost-cutting program, including the loss of 4,000 jobs in "back-office and managerial roles" (LONDON TIMES, 5/11). REUTERS' Paul Sandle reported setting out its plan for global services, BT said that it "no longer needed to own local networks outside Britain to serve its multinational and government customers," and could instead use "new network technology and partnerships." Luis Alvarez, BT's CEO, global services for the last five years, will be replaced by Bas Burger, who was most recently president of BT in the Americas, the company said. The discovery of a £530M ($683M) "black hole" in its Italian accounts had "stunned the market and forced BT to cut forecasts for the next two years" (REUTERS, 5/11).
