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Logica to cut hundreds more jobs to reduce costs

Warwick Ashford

IT services company Logica is to cut a total of 2,200 jobs after revising its 2009 sales forecast, saying it now expects a 3% drop for the year, not just 2%.

The company previously announced 1,900 job cuts, but has revealed an additional 300 jobs are to be cut in underperforming countries.

Logica's UK revenue was up 7% in the third quarter, compared with a drop of 23% in revenue from the Benelux region.

Logica said its cost-saving programme for the year remains on track, which includes the planned job cuts, property sales and limited hiring policies.

The company expects the programme to result in a total cost saving of £125m in 2010.

Despite the expected 3% sales decline for the year, Logica said orders in the third quarter rose 6%, buoying share prices by 1.5%.

Andy Green, chief executive at Logica, said the company continued to deliver well in the third quarter, with investments in client-facing activity resulting in good orders in a tough climate.

"Our pipeline of outsourcing opportunities remains strong, balanced by continued market weakness in consulting and professional services," he said.

Outsourcing sales rose 11% in the last quarter, compared with a 12 % decline in consulting and professional services.


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