UK incumbent BT said goodbye to chief executive Ben Verwaayen on Thursday, as the company reported an 18 per cent year on year drop in profit for the period to the end of March.

Verwaayen, who finishes a six year tenure this month, said that quarterly profit after leavers expenses and specific items came in at £494m, versus £601m a year ago. Revenues, however, were up 2 per cent year on year to £5.4bn.

A highly respected businessman, Verwaayen will be replaced by Ian Livingston, head of BT Retail.

New wave services, which includes networked IT services, broadband and mobility, gave a strong performance, delivering revenues of £2.3bn, up 9 per cent on last year and accounting for 42 per cent of revenue.

The carrier recorded 12.7 million wholesale broadband connections, including 4.3 million local loop unbundled lines. This represents an increase of 1.9 million wholesale broadband connections year on year. BT noted a retail share of net additions at 150,000, or 30 per cent of the total.

European telecoms analyst Michael Kovacocy, of the Daiwa Institute of Research Europe, said, “At first view, these look to be a strong set of results. GS is definitely playing to our investment thesis of becoming a growth engine for the company whilst increasing EBITDA margin as per management’s guidance.” With respect to recent concerns about flaggingWholesale revenue, he pointed to a bottoming out of YoY declines inrevenue and went on to say that, “With management offering visibility and forecasting another few quarters of weakness, fears of further erosion will likely diminish, helping sentiment.”

The carrier also announced a managed network agreement with mobile operator O2 that will see BT Wholesale provide and manage high speed connectivity between the majority of O2’s base stations and its core national network in the UK.

The backhaul deal will make use of BT’s 21CN network and follows similar deals stuck with Vodafone and T-Mobile.