LogicaCMG financial services revenues down; more jobs to be axed

LogicaCMG financial services revenues down; more jobs to be axed

LogicaCMG says its financial services business declined by 14% during the six months ending December 2002, as budgetary restrictions and deferred projects continued to affect the sector.

Reporting its first set of figures since the merger of the two computer services groups in December, LogicaCMG posted a net loss of £458.3 million for H1 on revenue of £882.5 million.

In response, the company announced plans to cut 9.5% of the workforce or 2200 staff worldwide - more than previously anticipated - in a bid to generate £80 million in annual savings.

Chief executive Martin Reid described the current climate at the "worst ever" in the history of the information technology industry.

The firm experienced declines across its business, with financial services particularly badly hit. In the UK, the company posted a 42% decline in revenue for the first six months as retail banking clients, which had held up better in the early stages of the market downturn, scaled back development activities. Lack of major mergers during the period also curtailed systems integration work.

On the positive side, the company says it continued to secure important contracts in key niches of payments and risk management, while the long standing relationships with the Dutch banks and insurers helped the firm to retain a greater share of their reduced spend.

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