55,000 jobs will be cut by 2030

2023-05-19 06:03:00

Reducing costs: this is the objective of BT which is suffering the consequences of the current difficult economic context for telecoms. The British telephone group thus announced on Thursday that it would cut up to 55,000 jobs by 2030, or 42% of the 130,000 people employed in total by the group, directly or through intermediaries.

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BT will build by the end of the 2020s “on a much smaller workforce and significantly reduced costs”summarized the general manager, Philip Jansen in a press release.

The group had already begun to decide on its costs. He also specified in his press release that his cost reduction plan, implemented since April 2020, was on track. “with gross savings of 2.1 billion pounds”approaching its goal of 3 billion pounds.

Halftone results

BT recorded mixed results in the first quarter of the year. The group saw its turnover decrease by 1% to 20.7 billion pounds for its annual financial year ended at the end of March, despite a 4% increase for its subsidiary Openreach, responsible for deploying fiber in the United Kingdom.

And if its net profit has increased sharply, by 50%, it is above all thanks to an exceptional tax credit linked in part to the sale of BT Sports, within the framework of a joint venture with Warner Bros. Discovery. The British operator had, in fact, announced in September the finalization of this project intended to bring together the assets of its BT Sport channel with Eurosport UK. It had also revealed, during the year, the merger of its Business and International divisions into a single unit, BT Business, in order to generate cost synergies there too. Patrick Drahi, boss of the telecoms and media group Altice, became the operator’s largest shareholder in June 2021 with 12.1% of the capital. He had increased his stake to 18% a few months later.

The group’s pre-tax profit fell 12% to 1.7 billion pounds. Finally, the Briton indicated having achieved an adjusted operating profit “in line with its expectations (…) despite significant headwinds” in the global economic context, and he hopes to see his results recover for the current financial year. As a result, BT shares fell 8.98% to 134.80 pence Thursday at the start of the day on the London Stock Exchange.

Vodafone cuts 11,000 jobs

BT is not the only operator to find it necessary to cut costs by cutting staff. Two days earlier, another British group announced a similar measure. Vodafone has revealed the loss of 11,000 jobs over three years as part of a restructuring plan. The company intends “simplify the organization to regain our competitiveness”, explained the new general manager Margherita Della Valle, in a press release for the 2022/2023 financial year, reporting stagnation in revenue at 45.7 billion euros. A performance “not good enough” for the leader who replaced Nick Read, following four years at the head of the British telecommunications group, in a context of poor performance.