BT Group sales up two per cent

But share price drops due to jitters over falling Wholesale division revenue

BT is talking up its Global Services growth

BT's revenue for the third quarter was flat at £5.1bn, a 1 per cent rise from the previous year, with pre-tax profit falling by 30 per cent from £639m to £447m.

The firm's share price fell on publication of the figures. But chief executive Ben Verwaayen was keen to emphasise the strong performance of the group's Global Services and Retail divisions, counteracting revenue contractions of £51m in the Wholesale business that sells BT network capacity to other telcos.

"We are delivering on what we promised on margin improvements in Global Services, hand in hand with robust growth," Verwaayen told investors.

"The business pipeline is the strongest ever," he said.

Global Services' has increased its margin to 10.9 per cent, up 140 basis points though still not at the firm's 15 per cent target. Third-quarter revenue for the division was up six per cent to £1.96bn, and is expected to rise in the final three-month period as long-term deals start to deliver.

BT Retail revenue was up two percent to £2.1bn, with strong growth in the small business market for a package of network and IT services.