London: BT Group Plc reported a sharp drop in third-quarter profit, as a write-down of years of profit in its Italian business muted gains in the company’s consumer and mobile businesses.

Profit fell 53 per cent to £374 million ($469 million), BT said Friday in a statement. That included a £245 million provision for an accounting scandal in Italy.

This week, the former UK telecommunications monopoly disclosed years of accounting irregularities in its Italian business, and also lowered its profit outlook as UK government clients and international corporate clients cut back on spending. Underlying revenue fell 1.5 per cent.

Chief Executive Officer Gavin Patterson had guided toward a “mixed bag” of financial results Tuesday, pointing to solid performance in the consumer business, mobile unit EE and network division Openreach. On Friday, he highlighted growth in those businesses and improvements in customer service.

“The good progress we’re making across most of the business has unfortunately been overshadowed by the results of our investigation into our Italian operations and our outlook. We’ve undertaken extensive investigations into our Italian operations and our outlook,” Patterson said in the statement.

The results cap a week of turbulence for BT and follow the biggest blow to Patterson’s reputation since he took the helm in 2013. He has focused on transforming a company long dependent on bulky government contracts into a consistent consumer-focused brand, with the acquisition of EE and investments in sports TV content, while being forced to also face a ballooning pension deficit, regulatory battle and political pressure to invest more in fibre.

In the quarter that ended on Dec. 31, BT reported a 32 per cent increase in revenue to £6.13 billion, aided by the acquisition of EE a year ago.

BT on Tuesday cited “inappropriate behaviour” and “improper accounting practices” going back several years in Italy, meaning a business it had said was profitable had long been losing money. It disclosed a 530 million-pound write-down over the accounting irregularities, more than triple a figure given in October when the company first discussed the investigation. The stock slid 21 per cent on Tuesday.