BT will announce about 6,000 job cuts worldwide as it looks to restore investor confidence after a “torrid” 18 months marred by the Italian accounting scandal and focal financial performance.
The telecommunications company is expected to announce the cuts, which account for about 6% of its 98,000 employees as part of corporate strategy is represented by its sole Executive body, Gavin Patterson, on the annual financial results of BT next Thursday.
The latest round of cuts, which are expected to affect managers and employees, back-office, will mean that BT will shed 10,000 jobs last year.
Analysts estimate that the reduction, reported the financial times ( £ ), will ultimately save BT around £500 million from £4.7 billion annual payroll. BT declined to comment.
Patterson, whose package fell by 4 million pounds after the Italian accounting scandal ruined his chances of getting performance bonuses, seeks to restore investor confidence. The share price of BT has more than doubled over the past two years, and a quarter compared to a year ago.
The share price rose about 1% to 234p at lunchtime on Friday.
In may last year, BT announced 4,000 jobs needs to be lowered about half of his work in the UK. These reductions were forecast to save about £300 million within two years.
Reduction followed by problems in the global division of BT services, which provides it and communications services for clients ranging from bi-Bi-si in Bromley Council, and a similar scandal in the Italian business, which is worth £530 million to clean up.
Prospect, the Union representing 140,000 workers in the public and private sector such as engineers and managers, said it expected consultations and active participation on any programme of job cuts.
“The prospect was aware that BT may be looking to cut jobs and will be directed to work with the company to minimize the number of affected workers,” said Philip childs, national Secretary of the Union. “Our priority is to provide its members with jobs and livelihoods are protected.”
Analysts at Exane BNP Paribas, in a note to investors earlier this week, says the publication BT the results for the full year next week the “day of reckoning”. Exane believes BT will also be forced to cut its dividend during the financial year by more than a third, and that job losses could be closer to 6,600.
“We believe that the layoffs will be in the spotlight in the upcoming results,” said Sam McHugh, a senior analyst on the note. “The reduction in staff remains one of the key drivers of value creation for the post of telephone operators, many of which still have large labor.”
BT the last large-scale layoffs came in 2008 and 2009, when 30 000 jobs went, again mainly as a result of the poor performance of its global services division.
Patterson has been through a roller coaster 18 months that includes a record £42m fine from the regulator ofcom for delays in the installation of high-speed Internet connection for competing telecommunications companies. Payout could hit £300m.
He authorized an eye-watering £1.2 billion deal to keep exclusive rights to the Champions League, an increase of one third of current Internet-BT, and the popularity of its BT TV began to wane.
Patterson was then called an end to the costly strategy of trying to defeat the sky for the Premier Premier League TV rights at the last auction – solutions for “viable second”, bringing year-end inflation law, which cost both sides billions.
And BT is in the process of downsizing and freestanding subsidiary Openreach, which is responsible for the creation and management of the majority of the broadband infrastructure in the UK is on a massive set.
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In February, he said, Openreach, he intends to create this year more than 3,500 technical jobs as part of a plan to accelerate the deployment of broadband fiber and eliminate “non-places” in the cities and suburbs.
Starting with the modernization of Britain for the next generation of Gigabit-speed Internet, said Openreach would be to hire and train engineers to achieve the new purpose-3M homes and businesses by 2020.