BT Ireland has announced a 2 per cent increase in revenue on back of increased growth in the Republic and Northern Ireland.

The British telecoms group recently signed a deal with Setanta Sports to add the BT Sport 1, BT Sport 2 and ESPN channels to the Setanta Sports pack.

The deal means that BT Sport will be available in the Republic from next month.

The company said operating costs for its Irish arm were flat as the benefits of its transformation programmes were offset by around £40 million of pre-launch costs for BT Sport.

Capital expenditure decreased by 11 per cent, despite the company’s investment in BT Sport, reflecting an additional broadband-related investment last year, it said. This contributed to a 5 per cent increase in operating cash flow.

In the UK, BTgroup said today more than half a million customers had signed up to take BT’s new sports service.

The 167-year-old former state monopoly, which was brought down in 2008 and 2009 by a series of profit warnings, posted first quarter profits comfortably ahead of forecasts driven by heavy cost cuts and a good performance from the retail division.

The results underlined the changes made by the outgoing chief executive Ian Livingston, with costs down and investment focused on a new fibre network and a TV service to try to return the group to revenue growth after a four-year downturn.

“BT continues to make good progress, delivering another quarter of solid growth in underlying profit before tax,” Mr Livingston said. “This is despite the impact of regulation and the significant investments we are making for the future. “It is early days but we are very pleased with the strong start in BT Sport. More than half a million households have now ordered BT Sport and that’s before the channels have even launched.”

BT has launched the biggest challenge yet to Sky's 20-year dominance of live English Premier League soccer by paying £738 million to secure live rights for three years, starting from August.

This includes 18 of the “top pick” matches, which for the first time will not all be with Sky Sports.