Some 900 East BT staff will each receive a €500 windfall in a profit share by its British parent company. The sum, to be issued as BT shares, is equivalent to 2 per cent of the telecom group's €50 million profit for the last financial year.

Chief executive Mr Ben Verwaayen said staff had "come up trumps" in a demanding trading environment.

The Irish division's fortunes appear to have undergone a transformation since BT threatened it with closure unless it ceased haemorrhaging cash. Losses for last year were €185 million, but the company broke even at an operational level with earnings before exceptional items of €18.5 million.

Workers will receive another 2 per cent share of pre-tax profits if performance targets are met.

Turnover fell to €253.2 million in the 12 months to March 2003, down from €259.8 million last year. This decline in revenues follows a review of its business by Esat BT and a sharp fall in the number of residential customers.

Esat BT said it now had just 60,000 residential telephone customers, down from more than 120,000 two years ago. It said further regulation was required in this market because of Eircom's aggressive win back campaigns.

Last April, the company announced the Irish division will be rebranded over coming months, in line with BT's recent decision to drop its distinctive "piper" logo.