BT BT Group PLC

By Ian Walker

LONDON--BT Group PLC (BT.A.LN) said Wednesday it has appointed Chet Patel to lead its Continental European operations, replacing Corrado Sciolla who left the company in January in the wake of the accounting scandal in its Italian business.

Mr. Patel, who has been BT's president for global portfolio and marketing for the past 18 months, will be focused on driving sustainable growth, the telecoms firm said. He starts the role on March 1.

On Jan. 24 BT said it had underestimated the severity of years of "improper" accounting practices and transactions in Italy, where it serves business customers and has no consumer-focused brand.

Following an investigation into the unit, which included an independent review by auditing firm KPMG LLP, BT took a write-down of 530 million pounds ($659.8 million). This was more than three times its previous estimate, which followed an internal inquiry.

Several executives in Italy left the business in January and the company also appointed a new chief executive in Italy, who started on Feb. 1.

The write-down hit BT's earnings. On Jan. 27, it reported net profit in the third fiscal quarter to Dec. 31 slumped 51% year-over-year to GBP374 million.

BT said earnings before interest, taxes, depreciation and amortization, or Ebitda, on an adjusted basis--a key measure--rose 18% to GBP1.87 billion, in line with company forecasts and powered by its consumer business.

On Jan. 24, BT lowered its forecasts for revenue, earnings, and cash flow over the next two years, citing the problems in Italy. The company also gave a downbeat outlook for trading in the U.K. public sector and in international corporate markets.

Simon Zekaria and Manuela Mesco contributed to this article.

Write to Ian Walker at ian.walker@wsj.com; @IanWalk40289749

(END) Dow Jones Newswires

February 22, 2017 07:14 ET (12:14 GMT)

BT (NYSE:BT)
Historical Stock Chart
From Mar 2024 to Apr 2024

BT (NYSE:BT)
Historical Stock Chart
From Apr 2023 to Apr 2024