Telstra To Announce 6,000 Job Cuts June
Telstra asserts it’s “on track” to notch $2.5 billion in cost savings by 2022, after moving up the announcement of 6,000 jobs cuts to mid-June.
The job cuts were originally slated for announcement in the first half of 2020.
Speeding up redundancy plans has prompt a $200 million lift in full-year re-structure costs, from ~$600 million to ~$800 million.
Chief Executive, Andy Penn, asserts the expedited process will see Telstra complete around 75% of flagged job cuts by the end of FY19.
The initiative forms part of Telstra’s T22 strategic plan, which seeks to slash over 8,000 jobs (a quarter of its workforce) in three years time.
The telco has today started consultation with unions and employees over the next stage of proposed jobs cuts.
“With today’s start of consultation, Telstra expects to have announced a reduction of approximately 6000 roles by the end of the financial year, which puts it on track to reach the previously announced net cost out target of $2.5 billion by the end of 2022,” the telco claims.
“This will result in the relevant restructuring cost being brought forward from FY20 to FY19.”
Writing off legacy IT assets will also see Telstra report $500 million in impairments in full-year 2019 results.
The telco claims impacted employees won’t leave until early full-year 2020, however, consultation will conclude by mid-June.
The company has re-affirmed its earnings guidance of between $8.7 billion – $9.4 billion.
Full-year income is forecast to notch $26.2 billion – $28.1 billion.
“We will continue to see role reductions as we replace our legacy systems, digitise and simplify how we work, and respond to things like declining NBN and call volumes, but if a final decision is made on the proposal announced today we expect the majority of our T22 restructure will be behind us,” remarks Penn.
“Overall we are on track in relation to our T22 program.”