Anglo Dutch computer group CMG is to cut 470 jobs in the UK and Ireland after warning of a significant downturn in business from the insurance, financial services, and transport sectors.
"Our UK business has been particularly impacted by the rapid deterioration in the insurance, personal finance, transport and logistics sectors where some projects have been cancelled and others deferred," the company says in a statement.
CMG says it continues to see strong performance in retail banking, government, managed services and payroll.
Nevertheless, the group warns that total UK information and communication technology (ICT) services revenues in the second half of 2001 will be lower than the same period last year (2000: £129.5 million). CMG says the worsening trading environment has led to a reduction in utilisation rates and expected insurance product licence revenues such that the UK is expected to trade close to break-even in the second half and will likely slip into the red following reorganisation and redundancy costs.
The company says it is cutting ICT services staff numbers in the UK and Ireland by 350 people and making a further 120 redundancies in its research and development centres at a total cost of £6.5 million. Annualised savings in 2002 will be in the order of £20 million, principally benefiting the UK services business.