3rd Quarter & 9 Months Results to 31 December 1999

British Telecommunications PLC
2 February 2000


NINE MONTHS RESULTS TO DECEMBER 31, 1999

     BT's results for the third quarter and nine months to
December 31, 1999 are summarised in the table below.

     Sir Iain Vallance, Chairman of BT, said:

     'As I indicated in my half year report, growth
prospects in the UK and internationally remain good but we
face increasing competition as the globalisation of our
industry continues.  In this quarter, competitive pressures
have adversely affected operating margins in the UK fixed
voice telephony market. The results also reflect the costs
of meeting increased customer demand and of growing new
areas of business.   We are responding to these rapidly
changing market trends and cost profiles.

     In January 2000, we formally launched the Concert
global venture with our partner AT&T and, last November, we
took full ownership of BT Cellnet.

     In short, BT remains well positioned to take advantage
of exciting developments in the market.  Our track record of
investing for the future, together with our focus on
efficiency and productivity improvements, will continue as
we reshape the group.'

-------------------------------------------------------------
     THIRD QUARTER AND NINE MONTHS TO DECEMBER 31, 1999
-------------------------------------------------------------
                         Third Quarter        Nine Months
                         1999     1998      1999       1998
                           £m       £m        £m         £m
Total turnover          5,585    4,684    15,901     13,326
EBITDA                  1,581    1,659     4,857      4,712
Total operating profit    761      911     2,465      2,588
Profit before goodwill
amortisation,
exceptional items and
taxation                  722      872     2,358      2,403
Profit on sale of fixed
asset investments           -        -        90      1,107
Profit before taxation    651      858     2,313      3,459
Profit after taxation     453      592     1,608      2,425
Earnings per share        7.0p     9.2p     24.9p      37.5p
Earnings per share
before exceptional
items and goodwill
amortisation              8.0p     9.4p     25.8p      25.8p
-------------------------------------------------------------

Results
-------
     Earnings per share for the nine months were 24.9 pence
compared with 37.5 pence in the comparable period of the
prior year, which included the £1,133 million gain on sale
of BT's interest in MCI Communications Corporation in
September 1998.  Before this and other exceptional items and
goodwill amortisation, earnings were 25.8 pence in the nine
months, unchanged on the prior period.  Profit before
exceptional items, goodwill amortisation and tax was
£2,358 million for the nine months, a reduction of 1.9 per
cent on the prior period.  Earnings before interest, tax,
depreciation and amortisation (EBITDA) before exceptional
items grew by 3.1 per cent to £4,890 million in the nine
months.

     Earnings per share for the third quarter were
7.0 pence.  Before goodwill amortisation and exceptional
items, earnings were 8.0 pence, a reduction of 14.9 per cent
on the comparable period in 1998.  EBITDA before exceptional
items declined by 4.6 per cent.

     The reduction in earnings in the third quarter was
caused by reduced call prices, increased lower margin
wholesale business with other operators, the cost of
developing new products and increased expenditure on
improving the quality of service to our customers.
Additionally, as expected, the group's interest expenditure
has risen as a result of the BT Cellnet minority acquisition
in November 1999 and significant investments in Japan,
Canada and the USA in August 1999.

Turnover
--------
     Total turnover, including the proportionate share of
the group's ventures, increased by 19.3 per cent to
£15,901 million in the nine months and by 19.2 per cent in
the third quarter.  The main drivers in turnover growth in
the nine months were BT's recently acquired interests in
Japan, USA and the Republic of Korea, its interests in
Europe and BT Cellnet and its acquisitions in the UK.

     Group turnover, excluding the ventures, grew by
12.0 per cent in the nine months and by 10.9 per cent in the
quarter.  Acquisitions contributed about 40 per cent of the
growth in the quarter and about 25 per cent in the nine
months.

     Mobile communications, including BT Cellnet, had
another good quarter.  BT Cellnet added 1.0 million
customers to its base in the quarter bringing the total to
nearly 7.0 million at December 31, 1999, an increase of
72 per cent over the twelve months.  BT Cellnet continues to
attract significant numbers of customers on post-pay
contracts which represent 55 per cent of its digital
customer base.  The vast majority of the additions were pre-
paid phones which have helped to stimulate a massive growth
in short messaging service usage.  Of the 61 per cent
increase in turnover in the nine months from mobile
communications, nearly half was contributed by the Martin
Dawes and DX Communications businesses acquired in 1999.  BT
Cellnet's Genie mobile Internet service continues to grow
rapidly with more than 350,000 customers.  BT Cellnet
launched its new Internet wireless application protocol
(WAP) phone in January, designed for people who want
Internet access on the move.

     Turnover from fixed exchange lines grew by 5.1 per cent
in the nine months reflecting the continuing high level of
demand for business ISDN lines.  Total business lines
increased by 6.4 per cent over the twelve months to
December 31, 1999 and after allowing for a small decline in
residential lines, BT's fixed network grew by 1.5 per cent
to 28.4 million lines.

     Fixed network call turnover in the UK has been impacted
by continuing price reductions, in particular the
25 per cent reduction in fixed to mobile call prices from
April 1999 and the new BT Together programme.  Volume growth
for inland calls continues to be strong predominantly as a
result of the rapid rise in calls to mobile phones and
Internet usage.  Inland call volume growth remained at 11
per cent on a twelve month moving average, which was the
highest percentage growth in the decade, but international
annual call growth slipped to 11 per cent.

     From January 2000, the responsibility for transit and
incoming calls to the UK has been transferred to the Concert
global venture with AT&T.  Consequently, we intend to
publish a combined inland and outgoing international call
figure in future quarters - the twelve month volume growth
moving average to December 31, 1999 was 9 per cent on this
new basis.

     Inland call turnover fell by 0.9 per cent in the third
quarter and international call turnover by 12.9 per cent as
a consequence of price reductions totalling over
£190 million more than offsetting volume growth.
Cumulatively inland call turnover rose by 1.3 per cent in
the nine months in contrast to a decline of 0.8 per cent in
international call turnover.

     There has been a rapid growth in BT's business with
other operators as competition intensifies in the UK.
Receipts from UK operators, mainly for calls terminating on
our network, grew by 72 per cent in the nine months.  This
business does not, however, provide BT with the same level
of margin as our UK retail business.

     Private circuit turnover increased by 6.5 per cent in
the nine months and by 8.1 per cent in the quarter.  Demand
for Kilostream and Megastream circuits is high partly due to
the growth in Internet related traffic.

     Yellow Pages and other directories turnover rose by
26 per cent in the nine months and by nearly 60 per cent in
the quarter.  Much of the growth is attributable to the
Yellow Book USA business acquired in August 1999.  The UK
Yellow Pages business has grown by around 8 per cent in the
nine months, partly reflecting the good growth in the
economy.

     BT's other UK sales and services include the solutions
and outsourcing businesses, and advanced services.  The
turnover growth in the nine months of 8.1 per cent primarily
from BT Solutions, was tempered by a 3.4 per cent decline in
the third quarter as a result of changed Concert billing
arrangements in advance of the global venture launch.

     The increase in turnover in BT's other non-UK
operations of 36 per cent for the nine months was derived
from Concert before its transfer into the global venture,
from systems integration activities in Holland and France
and from Clear Communications, our now 100 per cent owned
operation in New Zealand.

     BT's share of its ventures' turnover grew to
£1,929 million in the nine months.  The principal
contributors are Cegetel in France, Japan Telecom, Viag
Interkom in Germany and Airtel in Spain.  Our share of
Cegetel's turnover has increased by 29 per cent to
£535 million, mainly derived from its 7.3 million mobile
customers at December 1999.  Our combined share, with AT&T,
of 30 per cent of Japan Telecom's turnover since the
acquisition of our interest in August 1999, is also
included.  Viag Interkom's turnover has more than quadrupled
bringing our share to £218 million for the nine months.  It
had nearly 1 million mobile customers at December 31, 1999
built up mainly during the latter half of 1999.  Airtel had
4.8 million customers in Spain and our share of its turnover
rose by 70 per cent to £186 million.

     Our indicative analysis of the total turnover by
service type shows rapid growth in the newer products.
These are mobility which grew by 69 per cent, data up by
16 per cent, solutions businesses up by 23 per cent, and
internet and multi-media up by 67 per cent in the nine
months compared with the corresponding period of the 1999
financial year.  At December  31, 1999, BT and its ventures'
service providers served over 5.1 million Internet customers
in the UK and internationally.

Operating costs
---------------
     Operating costs grew by 15.7 per cent in the nine
months and by 18.5 per cent in the quarter.  Excluding
goodwill amortisation and exceptional charges, operating
costs grew by 15.4 per cent in the nine months and by
17.6 per cent in the quarter. Payments to other operators
represented nearly half of these increases in operating
costs in the quarter and nine months.  About 30 per cent of
the growth in operating costs in the third quarter and
25 per cent in the nine months period was attributable to
acquired businesses.

     Payments to other operators mainly comprise the
payments made to other UK fixed and mobile network operators
for calls terminating on their networks, payments to non-UK
operators for outbound and transit international calls and
costs associated with Concert's international activities.
Payments made to other UK operators have nearly doubled in
the nine months period because of the growth in fixed to
mobile calls and Internet related calls terminating on their
networks, as well as the impact of acquired businesses.
Following the launch of the Concert global venture in
January 2000, BT will no longer be making payments to non-UK
operators for outbound and transit international calls.  In
its place, BT will pay Concert for the delivery of
international calls.

     The people employed in the group increased by 13,000 in
the nine months to 137,700.  This increase includes 4,300
joining through acquisitions, 2,800 agency transfers, and 
5,200 extra people in BT's UK businesses to meet the increased 
demand for BT's services and to prepare for new products 
such as the ADSL broadband service.  Staff costs have risen 
by over 10 per cent in the nine months as a consequence of 
this and the annual pay award.

     Depreciation increased by 7.1 per cent in the nine
months partly due to higher computer and main exchange
depreciation charges.   We are assessing the value of
BT Cellnet's analogue network.  This had a net book value of
£65 million at December 31, 1999.

     The increase in other operating costs was mainly
associated with the cost of winning BT Cellnet's new
customers in the nine months and supporting its high growth.

Associates and joint ventures
-----------------------------
     The group's proportionate share of its ventures' net
operating losses increased by £50 million to £276 million in
the nine months, prior to goodwill amortisation of
£56 million.  BT's share of Viag Interkom's losses rose to
£186 million in accordance with its plans for developing its
fixed and mobile phone business in Germany.  British
Interactive Broadcasting's new Open digital TV service in
the UK had a very successful quarter ending with 1.9 million
households receiving digital satellite services, 45 per cent
of which access Open at least once per week.  BIB's start up
costs caused BT's share of its losses to increase to
£61 million in the nine months.  Losses continue to be
incurred by Telfort in the Netherlands as its mobile
business grows well, exceeding 430,000 on its customer base
at December 1999.  Cegetel, Airtel, Japan Telecom and Maxis
Communications in Malaysia are among BT's ventures
contributing positively to the group's total operating
profit.

Operating profit
----------------
     Total operating profit of £2,465 million for the nine
months is stated after charging £93 million goodwill
amortisation.  Before goodwill amortisation and exceptional
items, operating profit declined by 1.5 per cent in the nine
months.

Interest and taxation
---------------------
     Net interest for the nine months was virtually stable
at £242 million but the charge rose by £57 million in the
third quarter following the BT Cellnet minority acquisition
in November 1999 and the group's investments in Japan,
Canada and the USA in August 1999.

     BT's effective tax rate for the nine months has been
estimated at 30.5 per cent of profit.

Acquisitions
------------
     During the nine months ended December 31, 1999, BT has
completed a number of acquisitions of businesses or
interests in ventures, located both within and outside the
UK.

     The principal transaction has been the completion on
November 10, 1999 of the 40 per cent minority interest in BT
Cellnet held by Securicor.  The total cost of this
acquisition, which was announced in July 1999, was
£3,173 million, including legal fees and other expenses.
Progress is being made in expanding and developing BT
Cellnet's business including the launch of WAP mobile
products and bidding for one of the next generation of UMTS
licences in the UK in March 2000. In December, BT Cellnet
acquired the outstanding minority interest in Martin Dawes
Telecommunications following its original acquisition in
March 1999.

     As previously reported, in August 1999, BT jointly
acquired with AT&T a 30 per cent interest in Japan Telecom
for £1.25 billion.  BT has an economic interest of
20 per cent.  Concurrent with this transaction, BT sold its
Japanese subsidiary to Japan Telecom at a profit.

     Additionally in August 1999, BT acquired an effective
9 per cent economic interest in AT&T Canada Corp and, in
conjunction with AT&T, BT jointly purchased 33 per cent of
Rogers Cantel Communications.  Other acquisitions in the
first half of the financial year included Yellow Book USA,
Control Data Systems Inc, DX Communications and Clear
Communications and interests in Impsat and SmarTone.

     During the nine months, BT has continued to share in
funding the development of its ventures, principally Viag
Interkom and Telfort, to a total of £641 million.

Capital expenditure
-------------------
     Capital expenditure on plant, equipment and property
totalled £2,520 million in the nine months, 20 per cent
higher than in the corresponding period of the previous
year.  Work continues on enhancing the fixed network to
enable customers to benefit from the new wave communications
technologies, including ADSL.  BT Cellnet has continued
enlarging its digital cellular GSM network and investing in
GPRS technology prior to its launch of WAP high speed mobile
data communications system in January 2000.

Cash flow and net debt
----------------------
     Cash flow from operating activities amounted to
£4,332 million in the nine months.  The cash outflow on
acquisitions of £6,438 million consisted in the main of the
BT Cellnet minority acquisition and other interests
described above as well as further funding of Viag Interkom
and Telfort.

     In May 1999, BT issued a £600 million Eurobond
repayable in 2028 at an interest rate of 5.75 per cent.  In
August, a US $200 million Eurobond was repaid on maturity
and refinanced by a further 10 year US $200 million
Eurobond.  In October 1999, BT issued a US $1,000 million
Eurobond repayable in 2004 at an interest rate of
6.75 per cent.  We have financed our other requirements
during the nine months by drawing on commercial paper
programmes under which approximately £4.2 billion was
outstanding at December 31, 1999.

     Gearing at December 31, 1999 stood at 42 per cent with
net debt of £6,987 million.

Concert global venture
----------------------
     On January 5, 2000, BT and AT&T announced financial
closure of Concert, the global communications joint venture.
Concert began operations at the start of January 2000 as the
leading global telecommunications company serving multi-
national business customers, international carriers and
Internet service providers worldwide.  Concurrently, BT
transferred the majority of its cross-border international
network assets, its international traffic, its business with
selected multinational customers and its international
products for business customers together with the existing
Concert business into the global venture.

     Concert has built a new state-of-the-art high-speed
Internet Protocol (IP) backbone network which spans
21 cities in 17 countries.  Within the next 18 months, the
Concert IP network will extend to more than 60 cities
worldwide.  The network will support web hosting,
application services and other e-business solutions.

     Concert is expected to generate turnover of more than
US$7 billion in its first year and invest around
US$1.5 billion in capital expenditure as the venture deploys
its IP network.

Esat Telecom and Ocean Communications
-------------------------------------
     On January 11, 2000, BT announced that it had made an
agreed offer to acquire the Esat Telecom Group for
approximately £1.5 billion, subject to certain conditions.
Esat operates a fixed line telecommunications network in
Ireland and has a 49.5 per cent interest in Ireland's second
mobile operator, Esat Digifone.  The acquisition is subject,
amongst other things, to Esat's shareholders' acceptance and
regulatory clearance.  BT has also acquired a 1.0 per cent
beneficial interest in Esat Digifone from its current owner.

     On January 13, 2000 BT agreed to grant Telenor, the
owner of the remaining 49.5 per cent interest in Esat
Digifone, the right to exchange its interest in Esat
Digifone, subject to certain conditions, for a 33 per cent
interest in Esat.  If this right is exercised, Telenor would
have the additional right to purchase, from BT, shares in
Esat to give Telenor a 49.99 per cent interest in Esat for
US$624 million plus interest.  In the event Telenor does not
exercise its right to exchange its interest in Esat
Digifone, Telenor has agreed to sell this interest to Esat
for approximately US$1,238 million.

     On January 19, 2000, BT announced that it would acquire
the 50 per cent interest in the Ocean Communications joint
venture in Ireland that it did not already own for
approximately £130 million, subject to regulatory consents.

Year 2000
---------
     The transition into the Year 2000 went smoothly with no
significant Year 2000 issues emerging.  Those that did were
minor and did not affect customer service.  Demand on our
network services in the early hours of January 1, 2000 was
double that of the previous year.  The estimated cost of the
Year 2000 exercise is confirmed at about £300 million.  This
includes approximately £30 million staff costs over the New
Year period, of which £10 million was incurred in the third
quarter and £20 million will be incurred in the fourth
quarter.  BT believes that this smooth transition is
testament to the planning and investment that went into the
programme to minimise the risks involved.
     
     There remains a residual risk that computers will not
recognise the leap year date on February 29, 2000 and other
significant dates this year.  However, we have appropriate
plans in place and we believe that BT's Year 2000 programme
has achieved a significant reduction of this risk affecting
BT's activities.
     
Voluntary redundancy programme
------------------------------
     As part of the continuing programme of reshaping the
group, we are implementing a new voluntary redundancy
programme covering approximately 10 per cent of managers,
some 3,000 people, who we expect will leave over the next
six to nine months.  The total cost of this programme is
estimated at around £350 million, including the cost of
incremental pension benefits.

Fourth quarter ending March 31, 2000
------------------------------------
     In the absence of unforeseen circumstances, we estimate
that total operating profit (before goodwill amortisation,
redundancy costs, other operating income, exceptional and
other non-recurring items) for the fourth quarter ending
March 31, 2000 will not be materially different from that
for the third quarter.
____________________________________________________________
     
     The preliminary announcement of BT's results for the
year ending March 31, 2000 is expected to be made on
May 18, 2000.

GROUP PROFIT AND LOSS ACCOUNT
for the three months and nine months ended December 31, 1999
--------------------------------------------------------------
                            Third quarter        9 months
                         ended December 31   ended December 31
                           1999      1998       1999     1998
(unaudited)       Notes      £m        £m         £m       £m
-------------------------------------------------------------
TOTAL TURNOVER      2     5,585     4,684     15,901   13,326
Group's share of
associates and
joint ventures
turnover            2      (845)     (410)   (1,929)     (852)
                          -----     -----    ------    ------
GROUP TURNOVER            4,740     4,274    13,972    12,474
Other operating
income                       31        31       110       102
Operating costs (a) 3    (3,902)   (3,293)  (11,285)   (9,753)
                          -----     -----    ------     -----
Group operating profit      869     1,012     2,797     2,823
Group's share of
operating losses of
associates and
joint ventures      4      (108)     (101)     (332)     (235)
                          -----     -----     -----     -----
Total operating
profit                      761       911     2,465     2,588
Profit on sale
of fixed asset
investments and
group
undertakings (b)    5         -         -        90     1,107

Interest receivable          50        58       143       108
Interest payable    6      (160)     (111)     (385)     (344)
                          -----     -----     -----     -----
PROFIT BEFORE TAXATION      651       858     2,313     3,459
                        --------  --------  --------  --------
PROFIT BEFORE GOODWILL
AMORTISATION,
EXCEPTIONAL ITEMS AND
TAXATION                    722       872     2,358     2,403
                        --------  --------  --------  --------

TAXATION                   (198)     (266)     (705)   (1,034)
                          -----     -----     -----     -----
PROFIT AFTER TAXATION       453       592     1,608     2,425

Minority interests            -         3         4       (10)
                          -----     -----     -----     -----
PROFIT ATTRIBUTABLE
TO SHAREHOLDERS             453       595     1,612     2,415
                          =====     =====     =====     =====
EARNINGS PER SHARE  7
- BASIC                     7.0p      9.2p     24.9p     37.5p
                          =====     =====     =====     =====
- DILUTED                   6.8p      9.0p     24.3p     36.7p
                          =====     =====     =====     =====
EARNINGS PER SHARE
BEFORE GOODWILL
AMORTISATION AND
EXCEPTIONAL ITEMS    7
- BASIC                     8.0p      9.4p     25.8p     25.8p
                          =====     =====     =====     =====
- DILUTED                   7.8p      9.2p     25.2p     25.2p
                          =====     =====     =====     =====
--------------------------------------------------------------
(a) Including exceptional
costs                       (14)       (8)      (42)      (42)
(b) Exceptional gain          -         -        90     1,107

--------------------------------------------------------------

GROUP CASH FLOW STATEMENT
for the three months and nine months ended December 31, 1999
--------------------------------------------------------------
                            Third quarter        9 months
                         ended December 31   ended December 31
                           1999      1998      1999      1998
                             (unaudited)         (unaudited)
                             £m        £m        £m        £m
--------------------------------------------------------------
NET CASH INFLOW FROM
OPERATING ACTIVITIES
(note 8)                  1,480     1,313     4,332     4,099

DIVIDENDS FROM ASSOCIATES
AND JOINT VENTURES            2         1         4         2

NET CASH INFLOW (OUTFLOW)
FOR RETURNS ON INVESTMENTS
AND SERVICING OF FINANCE     13        34      (173)     (254)

TAXATION PAID              (163)     (363)     (413)     (561)
                        --------  --------  --------  --------
Purchase of tangible
fixed assets               (874)     (721)   (2,648)   (2,202)
Net sale (purchase) of
fixed asset investments     (20)       (3)     (162)    4,122
Sale of tangible fixed
assets                       27        47        84       112
                        --------  --------  --------  --------

NET CASH INFLOW (OUTFLOW)
FOR CAPITAL EXPENDITURE
AND FINANCIAL INVESTMENT   (867)     (677)   (2,726)    2,032

NET CASH OUTFLOW FOR
ACQUISITIONS AND
DISPOSALS                (3,282)     (737)   (6,438)   (1,710)

EQUITY DIVIDENDS PAID         -         -      (799)     (700)
                         ------    ------    ------    ------
CASH INFLOW (OUTFLOW)
BEFORE USE OF LIQUID
RESOURCES AND
FINANCING                (2,817)     (429)   (6,213)    2,908

MANAGEMENT OF LIQUID
RESOURCES                  (591)      256       773    (2,839)

Issue of ordinary share --------  --------  --------  --------
capital                       5        10       124       154
Issue of shares to
minorities                    -         -       432        13
New loans                   605         -     1,473         -
Repayment of loans          (29)     (147)     (383)     (151)
Net movement on short-
term borrowings           2,704       299     3,844       (17)
                        --------  --------  --------  --------
NET CASH INFLOW (OUTFLOW)
FROM FINANCING            3,285       162     5,490        (1)
                         ------    ------    ------    ------
INCREASE (DECREASE)
IN CASH                    (123)      (11)       50        68
                         ======    ======    ======    ======
DECREASE (INCREASE) IN
NET DEBT (note 11)       (2,812)     (419)   (5,657)    3,075
                         ======    ======    ======    ======
-------------------------------------------------------------

GROUP BALANCE SHEET at December 31, 1999
-------------------------------------------------------------
                                December 31       March 31
                              1999      1998        1999
                                (unaudited)       (note 1)
                                £m        £m          £m
-------------------------------------------------------------
FIXED ASSETS
Intangible assets (note 10)  4,416       571         742
Tangible assets             18,391    17,383      17,854
Investments                  4,451     1,797       1,832
                            ------    ------      ------
                            27,258    19,751      20,428

CURRENT ASSETS             --------  --------    --------
Stocks                         211       180         159
Debtors                      4,642     3,898       3,995
Investments                  2,507     3,609       3,278
Cash at bank and in hand       140        81         102
                            ------    ------      ------
                             7,500     7,768       7,534
                            ------    ------      ------
CREDITORS: AMOUNTS FALLING
DUE WITHIN ONE YEAR
Loans and other borrowings   4,801       974         947
Other creditors              6,917     5,221       7,082
                            ------    ------      ------
                            11,718     6,195       8,029
                            ------    ------      ------
                           --------  --------    --------
NET CURRENT ASSETS
(LIABILITIES)               (4,218)    1,573        (495)
                            ------    ------      ------
TOTAL ASSETS LESS CURRENT
LIABILITIES                 23,040    21,324      19,933
                            ======    ======      ======
CREDITORS: AMOUNTS FALLING
DUE AFTER MORE THAN ONE YEAR
Loans and other borrowings   4,833     3,653       3,386

PROVISIONS FOR LIABILITIES
AND CHARGES (note 12)        1,641     2,285       1,391

MINORITY INTERESTS             487       208         216

CAPITAL AND RESERVES       --------  --------    --------
Called up share capital      1,627     1,616       1,617
Reserves (note 13)          14,452    13,562      13,323
                           --------  --------    --------
Total equity shareholders'
funds                       16,079    15,178      14,940
                            ------    ------      ------
                            23,040    21,324      19,933
                            ======    ======      ======

-----------------------------------------------------------
NOTES
-----------------------------------------------------------
1    Basis of preparation
     --------------------
     The unaudited interim results of the group, which are
not statutory accounts, have been prepared on the basis of
the accounting policies as set out in the report and accounts
for the year ended March 31, 1999.  Figures for the year
ended March 31, 1999 are extracts from the group accounts for
that year.

     The group accounts for the year ended March 31, 1999, on
which the auditors made an unqualified report which did not
contain a statement under Section 237(2) or (3) of the
Companies Act 1985, have been delivered to the Registrar of
Companies.

2    Turnover
     --------
                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Inland calls               1,290    1,302     3,887     3,838
Exchange lines               891      850     2,617     2,490
Mobile communications        570      363     1,613     1,002
International calls          330      379     1,103     1,112
Private circuits             322      298       936       879
Receipts from UK operators   296      166       765       446
Customer premises
equipment supply             224      215       650       658
Yellow Pages and other
directories                  166      104       444       353
Other UK sales and
services                     425      440     1,353     1,252
Other non-UK operations      226      157       604       444
                          ------   ------    ------    ------
Group turnover             4,740    4,274    13,972    12,474
Share of associates and
joint ventures
turnover                     845      410     1,929       852
                          ------   ------    ------    ------
Total turnover             5,585    4,684    15,901    13,326
                          ======   ======    ======    ======
3    Operating costs
     ---------------
                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Staff costs                1,128      955     3,180     2,881
Own work capitalised        (125)    (109)     (348)     (327)
Depreciation                 682      647     2,014     1,880
Amortisation of goodwill      26        -        37         -
Payments to tele-
communication operators      815      534     2,235     1,495
Other operating costs (a)  1,362    1,258     4,125     3,782
                          ------   ------    ------    ------
Total operating costs
before exceptional costs   3,888    3,285    11,243     9,711
Exceptional costs (b)         14        8        42        42
                          ------   ------    ------    ------
Total operating costs      3,902    3,293    11,285     9,753
                          ======   ======    ======    ======

(a)  Includes redundancy costs of £6m for the three months
ended December 31, 1999 (1998 - £34m) and £19m (1998 - £97m)
for the nine months ended December 31, 1999.

(b)  The exceptional costs relate to the group's
disengagement from MCI.

4    Group's share of profits of associates and joint ventures
     ---------------------------------------------------------
     The results include goodwill amortisation of £31m for
the three months ended December 31, 1999 (1998 - £6m) and
£56m (1998 - £9m) for the nine months ended December 31,
1999.

5    Profit on sale of fixed asset investments and group
     ---------------------------------------------------
undertakings
------------
     The profit on sale in the nine months ended December
31, 1999 is mainly attributable to the sale of BT
Communications Services KK to Japan Telecom in August 1999.
In September 1998, the group completed the sale of its
interest in MCI for £4,159m at a pre-tax profit of £1,133m
and the gain for the nine months ended December 31, 1998 was
mainly this item.

6    Interest payable
     ----------------
                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Group                        137      107       334       328
Joint ventures and
associates                    23        4        51        16
                          ------   ------    ------    ------
Total interest payable       160      111       385       344
                          ======   ======    ======    ======

7    Earnings per share
     ------------------
     The basic earnings per share are calculated by dividing
the profit attributable to shareholders by the average
number of shares in issue after deducting the company's
shares held by employee share ownership trusts.  In
calculating the diluted earnings per share, share options
outstanding and other potential ordinary shares have been
taken into account.

     The average number of shares in the periods were:

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                          million of shares  million of shares
Basic                      6,497    6,455     6,485     6,437
Diluted                    6,659    6,601     6,643     6,580

     The items in the calculation of the earnings per share
before exceptional items and goodwill amortisation are:

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Profit on sale of group
undertakings                   -        -        90         -
Costs relating to the
disengagement from MCI       (14)      (8)      (42)      (42)
                          ------   ------    ------    ------
Profit on sale of MCI
shares                         -        -         -     1,133
Provision against another
fixed asset investment         -        -         -       (26)
Goodwill amortisation        (57)      (6)      (93)       (9)
                          ------   ------    ------    ------
                             (71)     (14)      (45)    1,056
Tax credit (charge)
attributable                   4        2       (15)     (300)
                          ------   ------    ------    ------
Net credit (charge)          (67)     (12)      (60)      756
                          ======   ======    ======    ======

8    Reconciliation of operating profit to operating cash flow
--------------------------------------------------------------

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Group operating profit       869    1,012     2,797     2,823
Depreciation and
amortisation                 712      647     2,060     1,889
Changes in working capital  (107)    (345)     (482)     (623)
Provision movements and
other                          6       (1)      (43)       10
                          ------   ------    ------    ------
Net cash flow from
operating activities       1,480    1,313     4,332     4,099
                          ======   ======    ======    ======

9    Expenditure on tangible fixed assets
     ------------------------------------

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Plant and equipment:
Transmission equipment       397      301     1,099       881
Exchange equipment           127       98       300       275
Other network
equipment                    143      106       442       323
Computers and office
equipment                     87      158       316       322
Motor vehicles and
other                         42       45       194       166
Land and buildings            50       39       169       130
                          ------   ------    ------    ------
Total expenditure            846      747     2,520     2,097
                          ======   ======    ======    ======

10   Intangible assets
     -----------------
     In November 1999, the group completed the acquisition
of Securicor's 40% interest in BT Cellnet for £3,173m,
including expenses.  Goodwill of £2,997m arose on this
transaction which is being amortised over a period of 20
years.

     Goodwill arising on acquisitions of other subsidiary
undertakings in the nine months ended December 31, 1999
amounted to £720m principally relating to Yellow Book and
Control Data Systems.  Goodwill is being amortised over
periods not exceeding 20 years.

     In September 1998, the group acquired MCI's 24.9%
interest in Concert Communications Company for £607m.
Goodwill of £568m arose on this transaction.  This goodwill
has been transferred with Concert into the global venture
with AT&T on January 5, 2000.

11   Net debt
     --------

(a)  Analysis
                             At December 31   At March 31
                            1999       1998      1999
                              £m         £m        £m
Long-term loans and other
borrowings falling due
after more than one year   4,833      3,653     3,386
Short-term borrowings and
long-term loans and other
borrowings falling due
within one year            4,801        974       947
                          ------     ------    ------
Total debt                 9,634      4,627     4,333
Short-term investments    (2,507)    (3,609)   (3,278)
Cash at bank                (140)       (81)     (102)
                          ------     ------    ------
Net debt at end
of period                  6,987        937       953
                          ======     ======    ======

(b)  Reconciliation of net cash flow to movement in net debt

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Net debt at beginning
of period                  3,841      526       953     3,977
Increase (decrease) in net
debt through cash flow     2,812      419     5,657    (3,075)
Currency and other
movements                    334       (8)      377        35
                          ------   ------    ------    ------
Net debt at end
of period                  6,987      937     6,987       937
                          ======   ======    ======    ======

12   Provisions for liabilities and charges
     --------------------------------------

                             At December 31   At March 31
                            1999       1998        1999
                              £m         £m         £m
Pension provisions           904      1,189        953
Deferred taxation            646        995        350
Other provisions              91        101         88
                           -----      -----      -----
                           1,641      2,285      1,391
                           =====      =====      =====
13   Reserves
     --------
                                                        £m
Balance at April 1, 1999                            13,323
Profit attributable to shareholders for
the nine months ended December 31, 1999              1,612
Interim dividend - payable
February 14, 2000                                     (565)
Currency movements(a)                                  (38)
Premium on allotment of ordinary shares                367
Movement relating to BT's employee share
ownership trust                                       (253)
Goodwill, written off to reserves before
April 1, 1998, taken back to the profit and
loss account                                             6
                                                    ------
Balance at December 31, 1999                        14,452
                                                    ======

(a)  Including £17m movement on the retranslation of foreign
borrowings and other hedging instruments.

14   Analysis of turnover by service type
     ------------------------------------
                Third quarter             9 months
                   ended                    ended
                December 31              December 31
                1999   1998   Increase  1999     1998  Increase
                  £m     £m      %        £m       £m      %
Fixed voice    2,755  2,646      4      8,183   7,885      4
Mobility       1,016    694     46      2,878   1,707     69
Data             597    544     10      1,689   1,462     16
Solutions        290    240     21        821     666     23
Internet and
multi-media      230    126     83        553     331     67
Customer
premises equip-
ment, Yellow
pages and other  697    434     61      1,777   1,275     39
               -----  -----            ------  ------
Total turnover 5,585  4,684     19     15,901  13,326     19
               =====  =====            ======  ======

     This analysis involves the use of apportionments and
allocations and should be taken as indicative.

15   Selected group activities
     -------------------------
                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
TURNOVER (a)
BT Cellnet                   652      359     1,791     1,025
Yellow Pages                 167      104       445       353
Syntegra                     124      104       344       293

OPERATING PROFIT BEFORE
GOODWILL AMORTISATION
BT Cellnet                    30       18        60       116
Yellow Pages                  40       25       132       123
Syntegra                      10        8        20        14

(a) Turnover includes sales to other group companies or units.

16   Selected group ventures
     -----------------------
                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
TOTAL RESULTS (a):
Turnover
Cegetel                      620      672     2,057     1,598
Airtel Movil                 369      267     1,046       661
LG Telecom                   176      163       567       n/a
Viag Interkom                265       55       483       109
Telfort                       66       41       178        79

Operating profit
(loss) before
goodwill
amortisation
Cegetel                       14      (13)      119       (21)
Airtel Movil                  37       (5)      148        51
LG Telecom                    39      (45)        1       n/a
Viag Interkom               (112)    (106)     (413)     (302)
Telfort                      (36)     (39)      (99)      (96)

(a) Results are stated on BT's accounting policies.

n/a = not a BT investment throughout the reporting period

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
GROUP'S SHARE OF ASSOCIATES
AND JOINT VENTURES'
RESULTS (a):
Turnover
Cegetel (26%)                161      174       535       415
Airtel Movil (18%)            65       48       186       110
LG Telecom (24%)              42       38       135       n/a
Viag Interkom (45%)          120       25       218        49
Telfort (50%)                 33       21        89        40

Operating profit
(loss) before goodwill
amortisation
Cegetel (26%)                  4       (3)       31        (5)
Airtel Movil (18%)             6       (1)       26         8
LG Telecom (24%)               9      (11)        -       n/a
Viag Interkom (45%)          (51)     (48)     (186)     (136)
Telfort (50%)                (19)     (20)      (50)      (48)

(a)   Results are stated on BT's accounting policies.

n/a = not a BT investment in the reporting period.

17   Earnings before interest, taxation, depreciation and
     ----------------------------------------------------
amortisation (EBITDA)
---------------------
                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Group operating profit       869    1,012     2,797     2,823
Depreciation and
amortisation                 712      647     2,060     1,889
                           -----    -----     -----     -----
EBITDA                     1,581    1,659     4,857     4,712
Exceptional items,
excluding depreciation        10        8        33        33
                           -----    -----     -----     -----
EBITDA before
exceptional items          1,591    1,667     4,890     4,745
                           =====    =====     =====     =====

18   United States Generally Accepted Accounting Principles
     ------------------------------------------------------
     The results set out above have been prepared in
accordance with accounting principles generally accepted
in the United Kingdom.  The table below sets out the
results calculated in accordance with United States
Generally Accepted Accounting Principles.

                             Third quarter        9 months
                          ended December 31   ended December 31
                            1999     1998      1999      1998
                              £m       £m        £m        £m
Net income attributable
to shareholders              395      530     1,385     2,137

Earnings per ADS(£)         0.61     0.82      2.14      3.32

Earnings per ADS before
exceptional items (£)       0.62     0.83      2.08      2.15


     Each American Depositary Share (ADS) represents 10
ordinary shares of 25p each.

     Shareholders' equity, calculated in accordance with
United States Generally Accepted Accounting Principles, was
£13,716m at December 31, 1999 (December 31, 1998 -
£13,263m, March 31, 1999 - £13,674m).
____________________________________________________________

Forward-looking statements - caution advised
--------------------------------------------
     Certain statements in this results release are forward
looking and are made in reliance on the safe harbour
provisions of the US Private Securities Litigation Reform
Act of 1995.  These statements include, without limitation,
those concerning: prospects in the UK and internationally;
the positioning of BT; expectations regarding competition,
prices, turnover, costs, profit (including total operating
profit), growth and the communications industry; the
expansion of networks; the impact and the consequences of
the residual Year 2000 issue; the possible or assumed future
results of operations of BT and/or its associates and joint
ventures; the impact on BT of Concert, the global venture
with AT&T, and Concert's turnover and capital expenditure
requirements; and increased interest charges and net debt.
     
     The financial forecasts contained herein are unaudited
and they have not been reviewed by BT's auditors.
     
     The principal assumptions underlying the forecast of
total operating profit before goodwill amortisation,
redundancy costs, other operating income, exceptional and
other non-recurring items for the fourth quarter ending
March 31, 2000, are:

(a)  There will be no significant change in the currently
prevailing economic conditions in the UK, or in those other
countries which are material to the non-UK turnover of BT;

(b)  There will be no material increase in overtime, staff
or other costs resulting from prolonged exceptionally
adverse weather conditions;

(c)  There will be no significant change in BT's market
share for its principal products and services;

(d)  There will be no failure by Concert to meet its
financial targets, the venture having commenced operations
on January 5, 2000.

(e)  There will be no material change in the foreign
currency exchange rates for  those countries which are
material to the non-UK turnover of BT;

(f)  There will be no change in government legislation or
regulations or actions by the Director General of
Telecommunications or other regulators which will have an
unexpected effect on the business of BT.

     Although BT believes that the expectations reflected in
these forward-looking statements, and the assumptions that
underlie them, are reasonable, it can give no assurance that
these expectations or assumptions will prove to have been
correct.  Because these statements involve risks and
uncertainties, actual results may differ materially from
those expressed or implied by these forward-looking
statements.

     Factors that could cause differences between actual
results and those implied by the forward-looking statements
include, but are not limited to: material adverse changes in
economic conditions in the markets served by BT; future
regulatory actions and  conditions in BT's operating areas,
including competition from others in the UK and other
international telecommunications markets; technological
innovations, including the cost of developing new products
and the need to increase expenditure improving the quality
of service; prolonged adverse weather conditions resulting
in a material increase in overtime, staff or other costs;
convergence of technologies; the timing of entry and
profitability of BT and Concert in certain national and
international markets; the risks, costs and uncertainties in
addressing the residual Year 2000 issues; and fluctuations
in foreign currency exchange rates.