10:59am UK, Friday May 16, 2008

BT's chief executive Ben Verwaayen has signed off his last set of results with fourth quarter figures which beat revenue forecasts and met earnings targets.

Broadband took a hit from rivals

The telecoms giant is also forecasting more growth next year.

Mr Verwaayen will be replaced by the company's retail boss Ian Livingston at the start of next month.

BT did struggle with competition in the broadband market but the majority of City analysts said the results were mostly reassuring.

The group reported underlying earnings before interest, tax, depreciation and amortisation up 2% at £1.57bn for the three months to March 31, in line with expectations.

Revenues rose by 2% to £5.4bn, ahead of forecasts at £5.3bn, with so-called new-wave revenues from broadband and corporate networked IT services representing 42% of that.

In broadband, BT's retail unit had a 30% share, slipping from 35% in the previous quarter.

Revenues at the wholesale division were also hit by broadband competition.

It sells network access to companies, and revenues were down 5% as rival broadband providers installed their own technology in exchanges instead of using wholesale lines.

Chairman Michael Rake said: "In 2008/09, we expect to deliver continued growth...as we continue our transformation from a fixed-line business into a software-driven global communications services company.

"We also expect our free cash flow to be at a similar level to last year.

"I am confident that we have the right strategy and people in place to continue to deliver value for our

shareholders and expect to increase dividends per share in 2008/09."