British Telecom cut capital expenditure at its wireless subsidiary Esat Digifone by almost 50 per cent in the first quarter this year compared to the same period in 2000.

Figures released by BT yesterday show the company trimmed capital expenditure to £19 million sterling (#31 million) in the first quarter, down from £36 million in the same period last year.

The firm more than doubled operating profit in the same period and increased turnover to £95 million, up from £67 million in the first quarter 2000.

Mr Pat Gallagher, group director of strategy at BT, said Digifone's performance in the three months to the end of June had been fantastic and was one of the best performing operations within BT Wireless.

He said there had been phenomenal focus on BT's debt but this would not affect its capital expenditure programme in Ireland.

BT announced it had cut its debt mountain to £17 million, down from £28 million in March. Underlying first-quarter profits fell 70 per cent, hurt by interest on its much reduced debt pile and losses at the wireless division it plans to demerge this year.

The company also said job cuts could total 6,000 this year rather than the 5,000 previously indicated, with 1,500 jobs likely to go at its Ignite corporate data business in Europe.

In its first report after its £5.9-billion sterling rights issue, BT said profits before goodwill, exceptional items and taxation slumped to £186 million sterling in the quarter from £637 million a year earlier.