In terms of continuing operations, revenue was flat at C&W extricated itself from operations in the US and Japan to concentrate on its home base in the UK and its interests in the Caribbean.
After buying broadband provider Bulldog Communications for GBP 18.6m ($33.5m), C&W is investing heavily in the operation that recorded an operating loss of GBP 34m ($61.2m) on revenue of GBP 11m ($19.8m) last year.
The company reckons that it has now unbundled 300 BT exchanges, giving it coverage of 30% of the UK broadband market, and plans to add a further 200 exchanges this financial on the way to its target of 800 exchanges by the first half of next year.
This is an expensive business and there are already 505 people on the Bulldog payroll. C&W plans to invest GBP 70m ($126m) in the business this year but it sees the spending as vital if its to capture a growing share of the broadband market, one of the fastest growing sectors in telecommunications.
It also plans to start a move upmarket and next month plans to launch a service aimed at the SoHo market, providing up to 8 VoIP lines, data and fast internet access.
The investment in broadband comes at a time when it is beginning the expenditure on its all-IP next generation network and while this will cost GBP 190m ($342m) though C&W argues that the incremental cost over the period will only be GBP 50m ($90m) because most of the spending will replace what would have been needed on its legacy systems.
Chairman Richard Lapthorne complains that the markets in which it operates continue to suffer from excess capacity and severe price competition. In the circumstances, the markets were relieved that C&W sees its margins remaining stable in the current financial year.
