Britain's Cable and Wireless PLC profit falls 5.7 per cent

By Jane Wardell, The Associated Press

LONDON - British telecommunications company Cable & Wireless PLC said it was considering splitting its business units after it posted a 5.7 per cent drop in annual profit on Thursday.

Cable & Wireless reported a profit of US$321 million for the year ending March 31, compared with $341 million a year earlier, when the bottom line was boosted by the sale of its Bahrain unit.

Revenue fell 5.8 per cent to $6.17 billion.

"We will look at all options," finance director Tony Rice said, adding that they could include a breakup, the sale of some of the company's voice, Internet and wireless networking service businesses or borrowing money to return capital to shareholders.

"We're talking about doing something in 2008 and 2009," Rice said.

The company forecast in March that sales at its Europe, Asia and U.S. division would increase 5 per cent to 8 per cent annually for the next five years, but its shares tumbled as analysts questioned whether the company would meet sales and cash-flow targets.

The stock rose 2.7 per cent Thursday to $3.10.

Collins Stewart analyst Mark James said he expected the shares to slip before any split of the company is announced.

Last year, the company cut its global workforce by nine per cent, bringing the total number of employees to around 5,000, as part of a wider cost-cutting strategy. Its full-year dividend was about 15 cents per share.