BT to shed 4,000 jobs in new overhaul – BBC News

Image copyright BT

BT says it will be shedding 4,000 jobs worldwide over the next two years in a major restructuring.

The telecoms giant said the posts would be going in back-office and managerial sectors as it simplifies its Global Services operations.

The shake-up follows an accounting scandal at the Italian part of Global Services that cost BT more than 500m.

BT’s chief executive and its now-departed finance director will lose their annual bonuses over the scandal.

Gavin Patterson and Tony Chanmugam understood the decision and would not have accepted a bonus if it had been approved, BT said.

In January, BT was forced to write down the value of its Italian unit after years of overstating profits.

‘Challenging year’

The head of the Global Services division, Luis Alvarez, is being replaced by Bas Burger.

It has already been announced that Corrado Sciolla, head of continental Europe, is stepping down over the affair.

BT said it wanted to “reposition Global Services as a more focused digital business”, as technology trends meant it was less dependent on owning physical network assets around the world.

The announcements came as BT disclosed that its annual pre-tax profits fell 19% to 2.35bn in the year to March.

“This has been a challenging year, but BT remains well positioned for the future,” the company said.

“Our strong businesses, underlying operational performance and financial returns show BT has the strength and breadth to withstand setbacks.”

It added that the results were broadly in line with the revised outlook that it issued in January, and that it intended to continue to increase its dividends to shareholders.

‘Still cautious’

“It’s been a pretty torrid time for BT management and shareholders of late and there is not a lot of good news in today’s full-year earnings report,” said Neil Wilson, senior market analyst at ETX Capital.

“A run of bad news means BT is still cautious and it expects little improvement to earnings and free cash in the coming year.

“Removing boss Gavin Patterson’s bonus is aimed at assuaging investor anger, but shareholders won’t be that impressed. His pay is down 4m, small fry in the ocean of BT revenues.”

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