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BT to slash 13000 jobs - will Sevenoaks office be hit?

11 May 2018

Patterson added: "BT delivered a solid set of financial results in the fourth quarter, with growth in our consumer divisions offset by declines in our enterprise businesses, due to both challenging market conditions and our decision to exit lower margin business".

The job cuts, the highest number by the former monopoly since 2008, will save 1.5 billion pounds in costs in three years, the company said.

BT is to cut around 13,000 jobs over three years in an effort to cut costs.

Mr Patterson said that around two-thirds of the job cuts would take place in the United Kingdom, while one third would impact operations overseas. "BT shares are down sharply but remain cheap on most valuation models and a dividend of yield of over 6% is compensation for risk involved in making Gavin Patterson's grand plan work".

"Many of the roles that BT is proposing to cut are highly skilled professionals and the loss of that expertise could impact BT's research and innovation capability".

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More than half of these new jobs had already been announced by Openreach, BT's broadband infrastructure standalone subsidiary. It will, however, seek to hire about 6,000 new employees for customer services and network deployment.

As for BT Centre, group chief financial officer Simon Lowth said: "We'll be looking at all options for the best future for that particular site, so (we're) very early in the process".

"If we are compared with our peers we are frankly too complex and overweight", Patterson said.

Its headquarters near the London Stock Exchange will be closed, although it will still maintain a smaller presence in London at a yet to be decided location.

"While I recognise the pain, ultimately it is the right thing to do for the business".

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The company also announced a 13-year plan to correct its £11.3bn pension fund deficit through regular payments and a bond issue.

The final salary scheme, closed to new members in 2001, had been the UK's largest private sector pension with a total of more than 300,000 members including retirees and ex-employees.

The strategy comes after the group reported a 3 percent drop in fourth-quarter revenue to £5.967 billion, just missing analysts' expectations, while core earnings came in at £2.083 billion, up 1 percent.

"This plan will help BT become a leader in converged communications; continue to power the UK's digital economy; and drive greater value for shareholders", the company said in a statement.

BT was also previous year hit by a £42 million fine from regulator Ofcom, plus a £300m compensation bill, for its failings around "deemed consent" in its Openreach division.

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BT to slash 13000 jobs - will Sevenoaks office be hit?