Top BT executives will not receive bonuses as profit slides after a "challenging" year

 
Courtney Goldsmith
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Gavin Patterson will not receive a bonus after a tough year for the telecoms giant

Top BT executives will not receive bonuses as the company grapples with a "challenging year", which saw profits drop 19 per cent.

Meanwhile, the firm also announced it will cut 4,000 jobs as part of a £300m corporate shake-up of its overseas operations.

The figures

For the year to the end of March, reported profit before tax was £2.35bn, down 19 per cent from the previous year.

Pre-tax profit was down 48 per cent for the fourth quarter to £440m after it took a £342m charge related to an Ofcom fine.

The telecoms firm said reported revenue grew 27 per cent to £24.06bn for the year.

Reported basic earnings per share were down 33 per cent to 19.2p for the year and 49 per cent to 3.8p for the fourth quarter.

The company's share price was down 3.47 per cent at 301.08p in morning trading.

Read more: Here's how City analysts reacted to BT's profit drop and corporate shakeup

Why it's interesting

BT boss Gavin Patterson and outgoing finance director Tony Chanmugam will not receive annual bonuses as the company grapples with the shakeup of its global services arm and an Ofcom investigation into historical deemed consent.

Tony Ball, chair of the remuneration committee, said: "The past year has been challenging."

Although good progress has been made in a number of areas, unfortunately our performance has been significantly affected by the accounting irregularities in our Italian business, the issues that arose in Openreach around deemed consent and the significant challenges we faced in the UK public sector and international corporate markets.

Patterson and Chanmugam will not be awarded a bonus, and BT said annual bonuses for 2014/15 and 2015/16 and vesting for the 2013 incentive share plan have been recalculated.

Patterson's total salary for the year was £1.35m, down from £5.28m the previous year, while Chanmugam received £258,000, down from £2.81m in 2015/16.

The committee said it will actively review whether any additional employees' awards should be adjusted.

Read more: BT boss Gavin Patterson to forfeit bonus over Italian accounts scandal

What BT said

Patterson said: "This has been a challenging year for BT. We've faced headwinds in the UK public sector and international corporate markets and must learn from what we found in our Italian business. Openreach also received a fine from Ofcom after an investigation into historical deemed consent practices revealed it fell short of the high standards we expect.

"We take these issues extremely seriously and are putting in place new measures, controls and people to prevent them happening again. Learning from the challenges of this year will make BT a stronger company for the future."

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