Alcatel-Lucent: Time to Swing the Ax
Alcatel-Lucent (NYSE:ALU) is planning to cut 1,800 jobs, according to a top union official. Italian operations will see a loss of 500 positions, while oeprations in Belgium and France will see their workforces cut by 10 percent and 5 percent, respectively.
Alcatel is expected to report a net income of 396 million euros during the last quarter, after 5 straight years of losses. Sales are forecast to slip marginally to 15.88 billion euros.
“Our priority is to continue to reduce our fixed and variable costs,” Alcatel-Lucent spokesman Simon Poulter said. “We are doing that through a number of measures. They include the application of our global presence to maximize our workforce and apply talent effectively where it can generate value.”
According to a union official speaking on condition of anonymity, the job cuts were communicated at a meeting with management on January 18. Alcatel-Lucent’s worldwide freeze on salaries is to be protested by about 600-700 employees in front of the company’s headquarters tomorrow.
Here’s how ALU shares reacted to the news:
Alcatel-Lucent (NYSE:ALU): ALU shares recently traded at $2.19, up $0.25, or 12.89%. They have traded in a 52-week range of $1.39 to $6.63. Volume today was 120,474,869 shares versus a 3-month average volume of 16,538,200 shares. The company’s trailing P/E is 6.95, while trailing earnings are $0.32 per share.
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