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Cable & Wireless Profit Jumps as Turnaround Continues

Reuters
Tuesday, 13 Nov 2007 | 3:42 AM ET

British telecoms group Cable & Wireless on Tuesday beat forecasts with a 29 percent rise in underlying first-half core earnings and increased its guidance for the Europe, Asia and U.S. unit.

The country's second-biggest corporate telecoms provider after BT Group reported earnings before interest, tax, depreciation and amortisation (EBITDA) of 284 million pounds ($590.7 million) for the six months to end-September compared with 221 million pounds a year ago.

Analysts were expecting first-half EBITDA of 267 million pounds, with estimates ranging from 257 million to 281 million pounds, according to Reuters Estimates.

It increased its EBITDA guidance for the Europe, Asia and U.S. unit by 35 million pounds to between 205 million pounds and 215 million pounds, but guided its International unit lower by $20 million to between $820 million and $840 million.

The group said the strong results followed its turnaround at the Europe, Asia and U.S. unit, formerly known as the UK business, which was ahead of schedule.

"The Europe, Asia & US turnaround is ahead of our own, and market, expectations with the success1ful execution of our strategy clearly visible in gross margin and EBITDA," Chairman Richard Lapthorne said.

"Turning cash flow positive in the second half will be a significant milestone for the business."

It increased the interim dividend by 47 percent to 2.5 pence and said the full year dividend was expected to be approximately 7.5 pence, an increase of 28 percent.

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