May 19 (Bloomberg) -- The U.K.'s benchmark stock index rose for a third day, led by telephone companies including BT Group Plc, which reported rising profit.

MFI Furniture Group Plc paced a gain by retail stocks after it said profitability improved at its U.K. business. Boots Group Plc climbed as the pharmacy-store operator stuck to a sales forecast and said yearly sales increased.

The FTSE 100 Index added 13.9, or 0.3 percent, to 4963.3 as of 2:17 p.m. in London, taking its advance since May 17 to 1.6 percent. The FTSE All-Share Index increased 0.4 percent to 2474.56. Declines for Cadbury Schweppes Plc and GlaxoSmithKline Plc shares weighed on the indexes' gains.

Stocks were buoyed by a U.S. government report that showed the number of U.S. workers filing new claims for jobless benefits fell last week by more than economists expected.

BT rose 9.75 pence, or 4.8 percent, to 211 pence. Britain's biggest phone company said fiscal fourth-quarter net income rose 44 percent to 435 million pounds ($800 million) after it spent less to reduce the workforce and sales grew for the fourth time in five quarters.

O2 Plc, the U.K.'s second-largest mobile-phone operator, gained 4 pence, or 3.4 percent, to 120.5 pence. Goldman, Sachs & Co. analysts including Simon Weeden raised the stock to ``outperform'' from ``in-line'', citing the outlook for earnings. The Slough, England-based company yesterday reported a second consecutive annual profit.

Jobs, Retail Data

Claims for unemployment benefits in the U.S., the world's biggest economy fell to 321,000 from a revised 341,000 in the previous report, the Labor Department said. The median estimate of 40 economists in a Bloomberg News survey expected 330,000.

Retail sales in the U.K. rose in April as stores offered discounts. Sales increased 0.5 percent from March, when they slipped a revised 0.3 percent, the Office for National Statistics said today in London. Both months were adjusted for seasonal effects and the impact of an earlier Easter holiday this year.

MFI rose 4.25 pence, or 4.1 percent, to 107.75 pence even as Britain's largest furniture seller said sales at its U.K. retail chain fell 4 percent in the first 20 weeks of the fiscal year.

``The group is outperforming many other'' retailers, JPMorgan Cazenove Holdings wrote in a note to investors. Investors had been anticipating ``a far worse outcome,'' according to the brokerage. Through yesterday, MFI shares had plunged 28 percent from their 2005 high on Feb. 18.

`Subdued' Trading

Boots, owner of the U.K.'s largest drugstore chain, added 16 pence, or 2.7 percent, to 613 pence. Chief Executive Richard Baker today repeated a forecast that annual same-store sales probably will be little changed to up as much as 2 percent, even though trading is ``subdued.''

Fiscal full-year sales rose 2.7 percent to 5.47 billion pounds as lower prices lured shoppers. Profit slid 27 percent to 302.4 million pounds.

Marks & Spencer Group Plc, the U.K.'s largest clothing-store operator, rose 6.5 pence, or 2.1 percent, to 335 pence. GUS Plc, the second-biggest British retailer, added 17 pence, or 2 percent, to 883 pence.

The FTSE 350 General Retailers Index rose 1.5 percent, with 19 of its 23 member companies gaining.

Cadbury, the world's third-largest soft-drink maker, lost 9 pence, or 1.7 percent, to 537 pence. The company needs to boost profitability to meet its full-year earnings target, Chief Financial Officer Ken Hanna said in a conference call today.

Glaxo, Europe's largest drugmaker, fell 15 pence, or 1.1 percent, to 1,352 pence. The stock has added 9.8 percent in the last three months, making it the FTSE 100's fourth-biggest gainer in the period.

The following stocks are also making gains or losses today. Company symbols are in parenthesis after company names.

Imprint Search & Selection Plc (IMP LN) added 6.5 pence, or 2.4 percent, to 282.5 pence. The recruitment company, which includes Hewlett-Packard Co. among its clients, said annual earnings are likely to exceed analysts' estimates.

Invensys Plc (ISYS LN) gained 5 pence, or 4.1 percent, to 12.75 pence. The U.K. engineer reported its first profit for eight quarters after selling units and receiving a tax credit. Chief Executive Rick Haythornthwaite will step down in two months.

Net income in the three months through March totaled 28 million pounds, compared with a loss of 139 million pounds a year earlier. Chief Operating Officer Ulf Henriksson will replace Haythornthwaite.

Mitchells & Butlers Plc (MAB LN) gained 21.25 pence, or 6.9 percent, to 328.75 pence. The operator of U.K. pub chains such as All Bar One and O'Neill's said fiscal first-half net income rose 14 percent to 59 million pounds after the company sold more food and wine. Sales at bars open at least a year advanced 5.1 percent in the eight weeks through May 7.

National Grid Transco Plc (NGT LN) declined 4 pence, or 0.8 percent, to 518.25 pence. The owner and operator of Britain's gas and power networks said second-half profit was little changed as a weaker U.S. dollar and a warmer-than-average U.K. winter offset cost cuts and rising income from new businesses.

Synergy Healthcare Plc (SYR LN) added 21 pence, or 5.3 percent, to 415 pence. The U.K. provider of medical-support services said fiscal-year profit doubled to 5.4 million pounds. The company boosted its final dividend by 58 percent to 6 pence.

Scottish Radio Holdings Plc (SRH LN), Scotland's largest commercial radio broadcaster, added 18 pence, or 2.1 percent, to 888 pence. The company said first-half profit rose 36 percent after local advertisers spent more at its stations.

Tomkins Plc (TOMK LN), the world's biggest maker of wiper blades, lost 8 pence, or 3.1 percent, to 249.25 pence. The company said fiscal first-quarter profit was little changed from a year earlier at 38.1 million pounds, crimped by lower automotive production in the U.S. and higher raw material costs.

To contact the reporters on this story: Sharon Smyth in Madrid at ssmyth2@bloomberg.net; Alexandra Dawe in Amsterdam at adawe@bloomberg.net

Last Updated: May 19, 2005 09:25 EDT