Telstra to cut 8,000 jobs in major restructure

20 June, 2018, 11:12 | Author: Eric Barnett
  • Telstra CEO Andy Penn says the telco is Telstra says it is targeting a further $1 billion in cost cutting by the 2022 financial year

Telco giant Telstra has announced it will be slash nearly a quarter of its workforce as part of a new strategy to "improve customer experience, simplify structure and cut costs".

The company, which has 32,000 employees, said one in four executive and middle management jobs will be eliminated over the next three years.

Telstra has been engaged in a continuous cost-reduction program throughout Penn's tenure, with its current "productivity program" targeting $1.5 billion over three years to offset the impact of the NBN on its fixed line revenues.

The announcement on Wednesday morning is part of raft of structural changes unveiled at the telco that have sent Telstra shares down more than seven per cent in early trade on the ASX, with the stock touching $2.70 at 1024 AEST - it's lowest level since 2011.

Mr Penn said the telecommunications sector had never been under more pressure, with the development of the NBN, significant increased competition, and huge pressure to invest in new technologies.

"In the future our workforce will be smaller, knowledge-based one with a structure and way of working that is agile enough to deal with rapid change".

Ratings agency S&P last month downgraded Telstra's debt for the first time in 12 years, highlighting the company's dwindling market share amid rising competition in Australia.

Telstra (TLSYY) said in a statement Wednesday that it will slash employee and contractor roles as part of plans to reduce costs by 2.5 billion Australian dollars ($1.8 billion) by 2022.


Mr Penn said while roles would no longer be required, he was hopeful new positions might be created.

In May, Telstra announced a downgrade of its results for FY18, saying it would come in at the bottom end of guidance - between $10.1 billion and $10.6 billion.

While the telco is sticking by that forecast, it now expects a fall in earnings for 2019 to between $8.7 billion and $9.4 billion - excluding restructuring costs of about $600 million.

"We have worked hard preparing Telstra for this market dynamic while ensuring we did not act precipitously".

As a effect of Telstra2022, up to 8,000 employee and contractor roles will be impacted.

The new business unit will be called InfraCo. "However, we are now at a tipping point where we must act more boldly if we are to continue to be the nation's leading communications company".

Its services will be sold to Telstra, wholesale customers and Australia's National Broadband Network, controlling assets with a book value of about A$11 billion.

Recommended:

  • Costa Rican media pessimistic after loss to Serbia

    Costa Rican media pessimistic after loss to Serbia

    In 2015, Serbia were proclaimed Under-20 world champions and Milinkovic-Savic was awarded the Bronze Ball. The Costa Rican bench were not impressed with the Serbian's vigorous efforts on the sideline.
    Microsoft Facing Threats of Boycott for Collaboration with ICE

    Microsoft Facing Threats of Boycott for Collaboration with ICE

    Immigration , Customs Enforcement, or Border Protection on any projects related to separating children from their families. Microsoft didn't immediately comment about whether it's still proud to supply ICE with its services.
    New Zealand beats 14-man France 26-13 in 2nd test

    New Zealand beats 14-man France 26-13 in 2nd test

    Replacement hooker Pierre Bougarit crossed to score a try on test debut but it was ruled out for a double movement. They managed only one more try in an error-strewn second half in which France competed and tackled heroically.
  • BJP move aimed at gains in Jammu, rest of India

    BJP move aimed at gains in Jammu, rest of India

    Contacted after the BJP's decision to pull out, Sharma, the interlocutor, said: "I'm in Srinagar and have just learnt about it". She added that her target was to save Article 370 that gives special status to the state and PDP did that for 3-4 years.
    RUMOR: Cavs will likely draft Michael Porter Jr. at No. 8

    RUMOR: Cavs will likely draft Michael Porter Jr. at No. 8

    Still, it may be wishful thinking to believe that the 6-foot-10 forward will be available that late in the draft. Even if Porter is no longer available, the Cavs are sure to have their pick of several top-flight talents.
    Trump threatens new round of $200bn tariffs on Chinese goods

    Trump threatens new round of $200bn tariffs on Chinese goods

    And now the president is warning the USA may impose tariffs on a total of $450 billion of Chinese goods. Brent crude futures LCOc1 fell 0.3 percent to $75.11 a barrel after rallying 2.5 percent overnight.
  • A Michael Jackson Musical Is Expected to Hit Broadway by 2020

    A Michael Jackson Musical Is Expected to Hit Broadway by 2020

    The book is to be written by Lynn Nottage , a playwright who has won two Pulitzers, for Ruined and Sweat . An American in Paris Tony victor Christopher Wheeldon has been tapped to direct and choreograph.
    Neymar injured in practice, expected back in training

    Neymar injured in practice, expected back in training

    On Instagram on Monday, Neymar posted a picture of his foot while receiving treatment alongside the message "work hard".
    Merkel, Macron agree on major EU reforms

    Merkel, Macron agree on major EU reforms

    Merkel , however, opposes any unilateral move to reverse her 2015 open-door policy and undermine her authority. " We don't want what is happening with immigration in Europe to happen with us! " he added.
  • Kane you believe it! England erupts

    Kane you believe it! England erupts

    The British public broadcaster says it got a record total of 3 million requests to stream the game on its website and apps. England needed a second strike in the first half to kill them off and could've gone on to get more and more.
    China responds to Donald Trump moves by scrapping surplus trade agreement

    China responds to Donald Trump moves by scrapping surplus trade agreement

    The United States now dominates those industries, but Chinese government support could make it hard for US companies to compete. While calling Trump's administration "inconsistent and precarious", it expressed hope a trade war might yet be averted.
    Dayton, Swanson challenge 'immoral' border separations of families

    Dayton, Swanson challenge 'immoral' border separations of families

    Almost 2,000 children were separated from their families over a six-week period in April and May. Nielsen said Thursday that as many as 10,000 of those children were sent alone by their parents.


Popular

Lewandowski mocks migrant girl with Down syndrome: 'Wah wah'
Trump's new policy is to separate those children from their family at the border as the adults are criminally prosecuted. Zac Petkanas , a Democratic strategist, was telling the story when Lewandowski said "womp womp" and rolled his eyes.

Gallery: Record numbers forced to flee homes
And as Israel marks 70 years of independence, there are some 5.4 million Palestinians still living as refugees, it said. The report noted that 2017 marked the second straight year that the number of internally displaced people decreased.

Rapper XXXTentacion dead at age 20 in Miami-area shooting
The footage shows witnesses attempting to check the rapper's pulse, but shows no obvious signs of bullet wounds or blood. According to police XXXTentacion , real name is Jahseh Onfroy , was taken to hospital where he was pronounced dead.

Sergio Ramos mocks Cristiano Ronaldo in Spain training after draw with Portugal
If he stays at Atleti, he will make Atleti a better teams and the same if he joins Barça. "We will respect them". Morocco might be without Nordin Amrabat, who suffered a concussion in Friday's 1-0 loss to Iran .

Mice chew up cash worth over a million rupees in India ATM
However, on June 11 a few repairmen had reached the ATM to fix it, and to their surprise they found rats feasting on the currency. When they cracked open the machine, they found piles of shredded cash, mostly Rs 500 and Rs 2,000 notes.

Top tier NBN uptake continues to grow
The access network achieved 100 per cent availability during the month, excluding planned outages NBN said. Just 0.089 percent of fixed-line customers have experienced network congestion, according to NBN.

At Least 2 Palestinians Wounded in Israeli Airstrikes in Gaza
An Israeli Army drone intercepts a kite launched by Palestinians from Gaza, at the Israel and Gaza Strip border on June 8, 2018. "Fire balloons" and kites carrying flammable material have become symbols of the Palestinian border protests in recent months.

McConnell: We'll work with Dems to end child separations at border
Ted Cruz of Texas that would allow detained families to stay together in custody while expediting their deportation proceedings. He also praised a few GOP lawmakers by name for defending him on TV, a Republican in the room told The Associated Press.

Xhaka signs new long-term Arsenal contract
Emery is preparing to take Arsenal forward following the departure of long-serving manager Arsene Wenger. The statement did not reveal the length or terms of the extension.

Salah unable to avoid Egypt defeat and likely elimination
Russian Federation will be guaranteed a place in the last 16 and Egypt eliminated unless Saudi Arabia beat Uruguay on Wednesday. All this is to say, neither team will want to risk wrecking its chances on Gameday 3, so a draw seems like the best bet.