Telekom Austria announces more lay-offs

11 Nov 2008

Telekom Austria has announced plans to axe 1,250 jobs by the end of 2009 in an attempt to cut costs at it its domestic fixed line division. A non-cash provision of EUR630 million (USD808.9 million) is being made to represent the estimated future personnel expenses of the redundant employees up to their retirement, and this will impact reported results in 4Q 2008, the telco says. The provision will not, however, have any effects on the firm’s operating performance or cash flow and it will improve future earnings. The measures are expected to improve 2009 EBITDA by approximately EUR35 million, primarily as a result of lower personnel expenses. ‘Against the backdrop of a shrinking domestic fixed line market, downsizing measures are imperative,’ said Boris Nemsic, CEO of Telekom Austria.

Austria, A1 Telekom Austria Group