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Madrid (pte037/11.04.2003/14:36) - Spanish telecoms giant Telefonica http://www.telefonica.com/home_eng.html has launched a radical personnel-reducing scheme that is to be completed by 2006. As reported today by Spanish daily El Pais http://www.elpais.es , between 10,000 and 15,000 jobs will be cut in the next three years, the majority of them in the group's fixed network service.
The reduction in personnel is part of a plan to improve the economic efficiency of the company. CEO Cesar Alierta intends to also increase turnover by 50 per cent by 2006 http://www.elpais.es/archivo/pdf.html?fpacket=3 .
According to El Pais, Alierta also hopes to increase Telefonica's ebit margin by 40 per cent and make all company areas profitable by 2005. Cashflow is to increase to 20bn euros by 2006 so that the company's debts of up to 23bn euros can be reduced over the following four years. Telefonica currently employs 42,356 people.
Not all cuts will take place in the fixed network division, however. Alierta also plans to reduce variable bonuses for managers by 20 per cent, having already cut his own bonus by 50 per cent.
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