BT has announced a further 15,000 jobs will be cut over the next 12 months after reporting a £134 million loss in the 12 months to March 2009.
The communications giant also confirmed that it had axed 15,000 employees in the past year - 5,000 more than expected. The recession has severely damaged profits at the firm; in comparison, it made a £2 billion profit in 2007/08.
Many of the problems appear to centre on its ailing Global Services division, which provides IT network systems to large firms. The division was forced to write-down £1.3 billion during the year after a major restructure.
Chief executive Ian Livingstone told investors he was was dismayed by the "unacceptable performance" of the Global Services arm, adding that its dire performance "overshadowed" the rest of its business. He said the firm as a whole had "performed well in spite of fierce competition and the global economic downturn".
"During the year we have changed the leadership of BT Global Services and started to turn the division around," he added.
BT has also slashed its final dividend from 15.8p to 6.5p to a level the board feels is "sustainable". In a statement to investors, it says: "The board is committed to delivering attractive returns for shareholders and believes that the operational improvements in the business will generate sufficient cash-flow to allow the dividend to grow."
With an eye to the future, BT said it expected revenue to decline by 4% to 5% in 2009/10, based on the economic downturn, the impact of lower mobile termination rates, and the restructure of BT Global Services.
The group will also be forced to make pension deficit contributions of £525 million before tax "for each of the next three financial years" - almost double the £280 million it was previously paying.
Its last three-year review set its deficit at £3.4 billion, but BT declined to reveal its current figure. There is some debate over the number; some analysts are forecasting it to be around £8 billion, while others suggest it could be nearer the £11 billion mark.