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Job cuts rumoured at Telecom

LATEST: Telecom CEO says job cuts will run into the hundreds

Telecom is this morning refusing comment on rumours reported by Radio Live and TVNZ that up to 2000 job cuts could be announced at the company's half-year results session this morning.

For its part, NBR ONLINE was told by a person with a company that works with Telecom that 50 jobs would go, including "the entire recruitment team." [UPDATE: A Telecom spokesman told NBR that the centralised recruitment team was likely to be disbanded in favour of each division doing its own hiring.]

Telecom is due to release its half-year result to the market at 9am, with a follow up audio conference for analysts and media at 10am (a break with the the company's tradition of inviting guests to an onstage briefing).

In August last year, Telecom said it had reduced its total head count to 7619 from (itself a chop from the prior year's 8629). The reduction is primarily due to staff who moved over to Chorus with the de-merger.

New CEO Simon Moutter has been widely expected to trim staff numbers, among other cost-cutting measures - although he has also launched two aggressive new intiatives:  flat rate roaming in Australia and a transtasman cable joint venture with Telstra and Vodafone.

For this morning's announcement, Forsyth Barr is expecting:

  • Revenues: $2.27bn, down -2% versus 1H12
  • EBITDA: $503m up +3%
  • Profit: $163m, up +66%
  • Interim Dividend: 8 cents versus 9 cents in 1H12.

ForBarr has a hold rating on Telecom shares.

ckeall@nbr.co.nz

More by Chris Keall

Comments and questions
25

So - When is Telecom going to announce what the hell is going on with 2,000 employee jobs!!!!!!!!!!!!!???????

Slightly off-topic, but why on earth did you feel the need to add so many exclamation and question marks? It gives the impression you're rather hysterical which, as you're obviously not a Telecom employee, is quite alarming.

Sorry, but Troll's like you aren't particularly helpful.

If I want to add numerous exclamation points - I will.

A lack of factual information in a post isn't helpful either

There won't be 2000 job cuts. Moutter hasn't given any number. It's the press that are saying 2000 - thats 26% of the company. Highly unlikely.

For Telecom to be competitive with industry peers on a employee to revenue basis it needs to cut approx 3000 people.

Big wake up coming.

In this case where there is a little smoke there is a raging hot fire with flames 20ft tall bearing down on your backyard

Its time to acknowledge that technology and distorted market realities that chop jobs are here to stay. Those without jobs should not be vilified. They should be paid a dignified universal benefit based on a minimum livable wage. This must be funded by increased tax rates on corporates and monopolies who continue to generate vast profits that are shared with their shareholders who, for what ever reason, have had access to land and/or capital from which to build their wealth. Share the wealth. We are all in this together.

I agree, comrade. Maybe we could switch over to being ruled by a dictatorship of the proletariate, too - you know, made up of our special urban elite (like you) who know what's best for everyone. And eliminate our bourgeois problem with special camps for their re-education and the elimination of those that won't learn their lessons. Murder a million or so people and you'll have this country running like the good old days.

Poor confused fool. You confuse Stalinism with ethically based Social Democracy. Get up to date. Sticking to your old fashioned orthodoxies is what got us into this crisis and will the next one too.

No, I don't. Under Capitalism, man exploits man. Under Marxism this is reversed.

Of course statists like you whose favoured methodology is to use the power of the state to seize what it wants are never satisfied. Once it starts, it never stops. Violence and the threat thereof is where it starts and violence is where it ends.

Love is where it starts and ends.

Love of power.

Pirates and bandits throughout history have found it easier to seize what others have done than to acomplish it themselves - whether through laziness or sheer lack of talent.

You are simply following in a fine tradition.

Love is obviously an unknown to you grumpy. Now those pirates and bandits...colonisers included?

Colonisers - absolutely, them too. I see you don't deny that similarity to your premise either.

And of course the biggest misnomer is claiming "love" in the name of a political philosophy whose founder declaired the need to "eliminate the bourgeois and ruling class" is a little like writing about the need for racial harmony whilst styling yourself "Nazi". I think what you call "love" others might call something more rapacious.

Eliminate doesn't mean kill them. Fundamentalist dullards misinterpret the thinking's of many. EG Mohamed and Jesus. Clearly you have no notion of what love is. Listen to some John Lennon. He might stimulate your imagination.

Oh man, time to look busy again.........

Although I am considered to be to the right of Ghengis Khan I have to agree with Marxist that jobs aren't being created for the people who are losing their jobs. It's more than just retraining or upskilling or reskilling. The facts are ten of thousands are being displaced thru no fault of their own with no comparable jobs available to them.
So, sadly, have to agree that these people need to be looked after with a livable income so they can survive, and companies owe a degree of social responsibility to those they put out of work and that requires they pay part of the increased profits they will make in the form of taxes.
Alas, given the rapacious multinationals it ain't gonna happen unless all Western governments get together and close loopholes and force these companies to pay their share of taxes. It's not commie or socialist. It's simple plain common sense.

I think I can safely say that our teflon coated Prime Minister and the National govt are going to be tipped out at next years election.

Tipped out? In favour of who exactly? The dysfunctional torn apart by internal politics Labour Party? Or the bunch of print more money, hopeless dreamers that is The Greens? Sounds a bit like a Tui advert to me!

They couldn't do any worse than National's borrow and hope dullards. In fact, my bet is they would do a heck of a lot better. At least the Greens are creative and prepared to be innovative. (Not that QE is that unorthodox)

You don't call these drones who are governing the country now competent, do you? What about Novapay for a start. I don't exactly call this circus good governance.

Good on you Telecom. It is long past time you got rid of the surplus drones. Half of which will be women that were hired using PC instead of merit as the criteria.
Great to see how competition brings in efficiencies, long may it continue.

but I like the ABs!
Will just have to get used to living in the lucky land of big spiders and puke yellow colours. So sad innovation seems to be dying here - that's the way our of the NZ big business serial down sizing.

As always, the axe will fall on the lowest rung employee. Fat, multiple layers of middle management with $200k to $500k salaries will continue to spend all day making "presentations" and looking "important".