BT 1998 Annual Report Download - page 28

The directors submit their report and the audited financial
statements of the company, British Telecommunications plc,
and the group, which includes its subsidiary undertakings,
for the year ended 31 March 1998.
Introduction
The business review on pages 6 to 14, the financial re v i e w
o n pages 15 to 25, the discussion on corporate governance
on pages 30 to 32 and the report on directors’ remuneration
on pages 33 to 40 form part of this report. The audited
financial statements are presented on pages 45 to 79.
Principal activity
The group’s principal activity is the supply of
telecommunication services and equipment. In the year,
96% of group turnover arose from operations in the
United Kingdom.
Directors
The names and biographical details of the directors of
the company are given on pages 26 and 27. All served
throughout the financial year, with the exception of
Bill Cockburn who was appointed to the Board as from
1 April 1998 and Helen Alexander and Neville Isdell who
will join the Board on 1 June 1998 and 1 July 1998,
respectively.
In addition, Yve M Newbold, Dr Alan W Rudge CBE,
Gerald H Taylor, Bert C Roberts Jnr and Birgit Breuel
served on the Board until their retirement as directors
on 30 June 1997, 31 October 1997, 9 November 1997,
17 March 1998, and 31 March 1998, respectively.
In accordance with the articles of association,
Bill Cockburn, Helen Alexander and Neville Isdell, having
been appointed to the Board since the last annual general
meeting, retire at the forthcoming annual general meeting
and will be proposed for election. Sir Colin Marshall and
Malcolm Argent re t i re by rotation and will be proposed for
re-election. Details of these directors’ service contracts or
contracts of appointment are included in the report on
directors’ remuneration on page 36 and the discussion
on corporate governance on page 30, respectively.
On 22 May 1998, BT announced that Sir John Weston, who
retires as Britain’s Ambassador to the United Nations at the
end of June, is to join the Board as a non-executive director
on 1 October 1998.
Substantial shareholdings
At 26 May 1998, the company had received a notification fro m
the Prudential Corporation group of companies under Part VI
of the Companies Act 1985 in respect of a holding
of 247 million shares representing 3.9% of the company’s
issued ordinary share capital.
Policy on the payment of suppliers
BT’s policy is to use its purchasing power fairly and to pay
promptly and as agreed.
BT has a variety of payment terms with its suppliers. The
terms for payments for purchases under major contracts
are settled when agreeing the other terms negotiated
with the individual suppliers. It is BT’s policy to make
payments for other purchases within thirty working days
of the invoice date, provided that the relevant invoice
is presented to the company in a timely fashion and is
complete. BT’s payment terms are printed on the
company’s standard purchase order forms or, where
appropriate, specified in individual contracts agreed
with suppliers. The ratio, expressed in days, between the
amounts invoiced to the company by its suppliers in the
year ended 31 March 1998 and the amounts owed to its
trade creditors at the end of the year was 29 days.
Auditors
A resolution to reappoint Coopers & Lybrand as the
company’s auditors and authorise the directors to settle
their remuneration will be proposed at the annual
general meeting.
Annual general meeting resolutions
The resolutions to be proposed at the annual general
meeting to be held on 15 July 1998, together with
explanatory notes, appear in the separate Notice of 1998
Annual General Meeting sent to all shareholders.
By order of the Board
C R Green
Secretary and Chief Legal Adviser
26 M AY 19 98
Registered office: 81 Newgate Street, London EC1A 7AJ
Registered in England: No 1800000
Report of the directors