Vodafone increases cuts as profits plummet

Mobile phone giant Vodafone has been forced to speed up its £1bn cost-cutting plan to counter poor trading results in its European business, raising fears that more job losses are on the cards.

The firm plans to save about £650m by March 2010– up from the £500m it had earlier suggested, according to newspapers.In February, the group announced 500 job losses, with about 170 expected to go in back-office roles – including HR – in its head office in Newbury.

Last year,Vodafone, which employs 10,000 people in the UK, announced it expected to reduce its worldwide operating costs by £1bn a year by 2011, in response to the rising price of raw materials, increased competition and a fall in consumer spending.

It was forced to writeoff £5.9bn in the 12 months to the end of March – mostly related to its Spanish business. Pre-tax profits fell to £4.2bn from £9bn the previous year.

The company did not give an exact sales forecast for the year to March 2010.

Earlier this year Vodafone’s HR director Matthew Brearley insisted the HR jobs cuts would be “small-scale”.

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