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Getronics lays off 1,400 workers to cut costs

Getronics, one of Europe's largest IT services companies, is to lay off 1,400 people as part of a cost-cutting drive. The company has also issued an earnings warning.

This second round of job cuts at the company will mainly involve operations in Italy, the Netherlands, Spain, France and Mexico and should be completed by June next year.

Last year, 1,450 employees were made redundant in Getronics locations around the world.

The cuts and other cost saving measures could save Getronics €85m (£54.1m) per year, the company said. The company employs 26,000 people in more than 30 countries and reported €1.84bn in revenue for the first half of 2002.

Customers should not be affected by the cuts, said Getronics spokesman Herbert van Zijl. Getronics is adjusting the number of employees to the amount of work that is available in the continued tough economic climate.

The market in the second half of 2002 is tougher than Getronics expected it to be when the company issued its second-quarter and first-half results, forcing it to lower its full-year 2002 earnings before interest, taxes and amortisation forecast from €125m to €110m, said Van Zijl.

Getronics hopes to see the first signs of a market recovery in the second half of next year, but does not expect a meaningful recovery of the IT services market until 2004.

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