14 DAY TRIAL // According to the latest news on the Web, Vodafone Group Plc, a leading mobile phone company, might soon announce hundreds of job cuts in the UK, a move that would help the company reduce costs and also protect its earnings throughout the economic slowdown. The info seems to come from two industry sources that are close to the company's plans.
According to the two people, the lay-offs are expected to be announced tomorrow. At the same time they also said that Vodafone’s U.K. operations would suffer the reductions, although they wouldn't point towards an exact number of job cuts.
It seems that Vodafone Chief Executive Officer Vittorio Colao is determined to squeeze more profit from the existing operations of the company, which, earlier this month, agreed with the merging of its Australian unit with Hutchison Telecommunications Ltd.’s operation in the country, considering that the growth chances in the area were rather small.
At the beginning of this month, Colao also announced that the company was on its way to plan cost reductions of 1 billion pounds by March 2011 to protect earnings. At the same time, he also stated that the measures the company would take were expected to have “some impact on headcount,” yet he did not unveil the number of jobs that were to be affected. On the other hand, he stated that the cuts would include “network rationalization,” as well as lower spending in areas like logistics and advertising.
Simon Gordon, a Vodafone spokesman, did not comment on the news story.
Back in November, Vodafone announced lower full-year sales forecast, although it maintained the same profit forecast. Last year, during six months ended September 30, Vodafone’s U.K. unit registered a margin on earnings before interest, taxes, depreciation and amortization of 23.2 percent. In Germany, the company had a 44 percent margin, and 44.9 percent in Italy.