C&W forecasts Q3 revenue decline

Cable & Wireless Plc has forecast that third-quarter revenue will fall by 6% to $1.5 billion. In a trading statement, the company also said it expects income before exceptional items in the second half of the year to March 31 to be a "reasonable reflection" of what was achieved in the first half when it recorded net income of $328.8 million.

In the UK, C&W has been hard hit by regulator Ofcom’s reduction in mobile termination rates. The company is pinning its hopes on its GBP18.6 million ($34.1 million) purchase in June 2004 of DSL broadband specialist Bulldog Communication Ltd that will enable it to step up its attack on incumbent carrier BT Group Plc.

Together with its purchase of a stake in Monaco Telecom, C&W said the new businesses contributed GBP30 million ($56.1 million) of revenue in the quarter, up GBP1 million ($1.8 million) on the previous three months.

At its national telco business, revenue increased 14% in the quarter to GBP306 million ($572.8 million) at constant currencies. However, the company has been hard hit by competition in its Caribbean operations where revenue fell 12.6% to GBP139 million ($260.2 million).

C&W is still sitting on a cash pile of GBP1.38 billion ($2.58 billion).

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