BT to ‘leave no stone unturned’ after upping cost cuts to tackle inflation

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The boss of telecom giant BT has warned of further job cuts and price hikes as the group “leaves no stone unturned” to save an additional £500 million in the face of rising inflation and energy costs.

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Chief executive Philip Jensen said it would “essentially” cut some roles, while also raising prices for consumers and businesses as it seeks to cut costs by £3 billion by the end of 2024-25. – Performs a comprehensive action, which is above the previous. 2.5 billion pound target

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He declined to put a number on the job’s impact and insisted that there would be no major restructurings, with the firm instead looking to reduce its overall workforce through normal staff turnover.

Given the current high inflationary environment, including a significant increase in energy prices, we need to take additional action on our costs

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Details of the additional cost savings came as BT revealed an 18% drop in profit before tax to £831 million in the six months to 30 September, with rising inflation already affecting its bottom line and revenues falling. Offsetting a 1% increase to £10.4. Arab.

The firm said it faces a £200 million increase in its energy bill this fiscal year.

Mr Jenson said “everyone has to share the pain”, which includes the group’s 100,000-strong workforce and customers.

He added that he was “leaving no stone unturned to ensure that BT can be the most efficient organization”.

“Essentially, this means that some jobs will not exist in the future,” he said.

Its charges for most homes are due to rise to 3.9% next year on top of inflation, he said, while OpenReach customers will also be affected by inflation-linked price hikes.

But he said the group also wants to support struggling customers with the launch of a new mobile phone tariff for low-income households, offering a discounted rate of £12 per month, which is higher than its existing broadband and fixed-line social tariffs. adds in.

BT has already cut costs by £1.7bn since April 2020 and Mr Jenson is leading an overhaul, which includes reducing the number of offices across the UK from around 400 to around 30, and with a number of consumer charges Including simplifying customer billing systems and ranges. Already more than 30% has been reduced.

Mr Jenson said: “Given the current high inflation environment, including a significant increase in energy prices, we need to take additional action on our costs to maintain the cash flow needed to support our network investments. “

But with BT and OpenReach employees staging a new strike last month, the firm has been facing long-standing pressure to pay its employees.

Members of the Communication Workers’ Union (CWU), including 999 call handlers, went out for 24 hours after a wave of halts in recent weeks.

Mr Jenson said: “We are working really hard to get out of the situation so that we can be more cohesive with the workforce.”

Shares in BT fell more than 7% in early trade on Thursday, despite assurances from the firm that its financial performance remains on track.

This is guiding for full year underlying earnings of £7.88 billion on revenue of £20.9 billion.

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