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Summary Financial Statement
Statutory information

The principal areas of turnover growth were through the acquisition of interests in Europe and from interconnect with UK operators.

Profits were affected by a number of exceptional items, in particular a £3 billion charge taken against goodwill in Viag Interkom. Before these items, earnings per share were 20.5 pence, compared with 34.2 pence in the previous financial year. The lower earnings in the current year were mainly due to higher interest charges following the acquisition of businesses and 3G licences over the past 18 months.

During 2001, we began a radical restructuring of BT, with the emphasis on setting up a number of separate highly-focused businesses with potential for growth. We intend to demerge BT Wireless and will sell or demerge Yell.

Acquisitions and disposals
We have taken full control of Telfort in The Netherlands, Viag Interkom in Germany and, in April 2001, full control of Esat Digifone in the Republic of Ireland.

More recently we have announced the prospective disposal of our interests in Airtel in Spain, Japan Telecom and J-Phone in Japan and Maxis Communications in Malaysia.

In the UK
Calls on our fixed network accounted for about 28% of group turnover. Call volumes continued to grow with, on average, 90 million UK local and national calls being made every day.

Many other telecommunications operators use our network to help deliver their customers’ calls. This interconnect activity has increased rapidly and accounted for about 14% of group turnover.

We continued to invest in our UK network to meet increasing demand for high-quality fixed-network products and services. In less than a year we have replaced nearly half of the trunk exchanges which took five years to install in the 1980s.

We have continued to reduce prices and simplify our pricing structure, and have introduced new options, such as BT Together, to give customers greater choice and control over how they are charged for our services.

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BT Cellnet had 11.2 million customers as at
31 March 2001, an increase of more than 50%
during the 2001 financial year. In the UK,
BT Cellnet acquired a 3G licence for £4.03

Through Telfort, Viag Interkom and Esat
Digifone we have 5.7 million mobile customers
outside the UK.

We have launched a range of mass-market broadband internet services aimed at consumers, small businesses and teleworkers. We continue to develop a range of tools, including communications, navigation and personalisation, all of which will be linked and made available through a Personal openworld Portal accessible across a number of devices.

Research and development
We invested £364 million in research and development on areas including next-generation internet, broadband wireless and network management.

BT people
At 31 March 2001, BT employed around 137,000 people throughout the world, with 117,900 in the UK, making us one of the UK’s largest employers. During the year we formed a joint venture with Accenture (formerly Andersen Consulting) to deliver outsourced human resources services to large organisations. BT prides itself on being a learning organisation. Increasingly, we are using the internet to deliver training and development programmes.

Our commitment to society
BT takes seriously the responsibility that comes with being a company that has the potential to improve people’s lives through better communication. We make regular donations in the UK to direct activities in support of society, such as education. Our UK operations have ISO 14001 certification, the international standard for environmental management systems.

Statement of Business Practice
To reinforce our commitment to achieve best practice in our standard of business integrity, a copy of BT’s Statement of Business Practice has been sent to every employee. We also require our agents and contractors to apply these principles when representing BT.

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