EDS postpones results

EDS postponed the release of its third quarter earnings for the second time last week, pending the completion of an independent...

EDS postponed the release of its third quarter earnings for the second time last week, pending the completion of an independent audit of a £4.8bn contract with the US navy and an investigation into its bonus scheme.

The outsourcing supplier is shedding up to 20,000 jobs as part of its effort to improve profitability. In July, EDS handed over its highly publicised Inland Revenue contract to rival Capgemini.

The company said it would release its third quarter earnings following the audit and US Audit Committee's investigation related to quarterly bonus plan accruals in 2003 and 2004. Jeff Baum, vice-president for external relations at EDS, said, "We do not foresee any impact on customers and we are making good progress in the business."

Analyst group Ovum said, "EDS has been a pioneer in outsourcing, and to some extent it has paid the price of leading the charge. The biggest risk is that the company that emerges from all this is a neutered EDS, one that had lost the trail-blazing, innovative and risk-taking character that made it an industry leader in the first place."

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