Struggling Alcatel-Lucent to cut 4,000 more jobs
31 October 2007, PARIS (AFP) - Alcatel-Lucent, the struggling French-US telecommunications equipment maker, announced Wednesday it would cut an additional 4,000 jobs by 2009 as it unveiled a sharp third quarter net loss.
31 October 2007
PARIS (AFP) - Alcatel-Lucent, the struggling French-US telecommunications equipment maker, announced Wednesday it would cut an additional 4,000 jobs by 2009 as it unveiled a sharp third quarter net loss.
The new job cuts, designed to save the company 400 million euros (578 million dollars), are in addition to 12,500 announced in February, shortly after the merger of French firm Alcatel and Lucent of the United States.
Trade unions quickly denounced the new reductions as a "losing and counter-productive strategy" that would only "impoverish the company."
Alcatel-Lucent reported a third quarter net loss of 258 million euros compared with what would have been 523 million euros a year earlier if the two companies had been combined.
At the operating level earnings came to 70 million euros, down from 430 million in third quarter 2006.
Sales rose 2.3 percent to 4.35 billion euros from second quarter 2007 but were down 7.8 percent from the third quarter of 2006.
The results were consistent with market expectations and with what the company itself forecast on September 13.
"Our results this quarter were essentially in line with the update we provided on September 13 and in a few cases a bite better," said chief executive Patricia Russo.
"However they are still not at a level that we are satisfied with."
"We recognize that market conditions remain difficult, with continued pressure on revenues and margins due to intensified competition and some slowdown in North America."
A plan to streamline the group's core business, accelerate cost-cuts and implement a simplified management structure would improve operating margins, she said, adding that the job reductions would be handled "with care."
The group also announced the departure of finance director Jean-Pascal Beaufret.
Shares in Alcatel-Lucent were showing a gain of 3.17 percent to 6.84 euros in early trading on the Paris exchange, which was 0.04 percent stronger overall.
Subject: French news