NE 1 still follow? These cuts seem high on a percent basis. Don't know if they had choice, but does this put company on downward spiral?
U.K.-based Cable & Wireless to cut 4000
WASHINGTON, Mar 14, 2001 (United Press International via COMTEX) -- Cable & Wireless, the United Kingdom-based worldwide data and Internet services company, is laying off 4,000 workers in a cost-cutting effort, the company announced Tuesday.
The layoff news coincided with the company's announcement of a lowered earnings estimate, which warned investors that profits would drop as much as 20 percent below industry analysts' expectations for the first quarter of this year.
The Times of London reported that industry analysts in the United Kingdom "were infuriated" by the scale of the company's earnings downgrade, which came without any advance warning.
While analysts were expecting some lowering of profit estimates -- based on the slowdown of the telecom and technology businesses worldwide -- the sharp drop below consensus came without any advance indication from the company that its situation had deteriorated so quickly.
The staff layoffs represent around 22 percent of the company's global workforce, and around 50 percent of its core workforce. Also, the company plans to reduce capital spending by approximately $750 million for the year.
C&W is investing billions of dollars into building a worldwide Internet protocol (IP) network, that will enable it to offer complete voice, data and Internet services to business clients.
The U.K company's cuts are like those of many companies in the telecom sector, such as Motorola, the Illinois-based telecommunications giant that said Tuesday it was cutting 7,000 jobs.
Copyright 2001 by United Press International.
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