Telstra will make 6,000 of a planned 8,000 job cuts in this financial year, as it makes progress on a wider restructure to reduce costs and simplify its operations.
In a statement, the company provided an update on the plan, dubbed T22, which it announced in June 2018 as it looks to respond to market challenges and declining profitability.
The Australian operator said the reduction of 6,000 jobs meant an additional AUD200 million ($138.4 million) in restructuring costs will recorded in this financial year, increasing the total from AUD600 million to AUD800 million.
The impacted employees will not leave the company until early 2020, but the consultation process is expected to conclude in June, which is why the costs will be included in its fiscal 2019 results, said the company.
Telstra has committed up to AUD50 million to a “transition” scheme to help the affected employees move into new roles.
In addition, Telstra also wrote-down the value of legacy IT assets by around $500 million.
The T22 plan is intended to reduce costs by an extra AUD1 billion by mid-2022 on top of an existing goal to cut outlay by AUD2.5 billion by the end of fiscal year 2022. As well as job cuts, Telstra is looking to streamline its operations and products.
CEO Andrew Penn said bringing the financial impacts of the cuts forward to fiscal 2019 indicated good progress of the strategy.
“Overall, we are on track in relation to our T22 programme,” he said.Subscribe to our daily newsletter Back