Update 3: Lucent Cuts Retirees&#39; Health Benefits
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For the second time in a year, telecommunications equipment maker Lucent Technologies Inc. is reducing benefits promised to thousands of its retirees.
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ATLANTA --Telecommunications firm BellSouth Corp. said Wednesday that the new terms of its tentative labor agreement will change how the company&#39;s contribution to retiree medical benefits is calculated and will boost benefit expenses by $3.3 billion.
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Alcatel-Lucent said it plans further layoffs after its post-merger financial performance continued to disappoint.The company fleshed out its three-point plan for restoring profitability on Wednesday, including a renewed focus on products to help carriers transform their networks to an all-IP (Internet Protocol) infrastructure, a move from products to value-added services, and a more streamlined organization with fewer staff in support functions to eliminate post-merger duplication. It will cut a further 4,000 jobs by 2009, in addition to the thousands it has already shed, and hopes the moves will save it a further &#8364;400 million (around $575 million) by that date, it said.In another change, Alcatel will reduce its senior management team to seven members, from 11, and&#160;Chief Financial Officer Jean-Pascal Beaufret will leave, to be replaced by enterprise systems group head Hubert de Pesquidoux.Alcatel-Lucent&#39;s board has expressed its disappointment with the&#160;decline in performance&#160;since the Dec. 1&#160;merger of Alcatel and Lucent Technologies, but expressed its continued support for CEO Patricia Russo earlier this month. Russo has the board&#39;s support for her plan to restore the company to profitability, she said Wednesday.&quot;It&#39;s not a plan solely focused on cost. It&#39;s also focused on growth,&quot; she said in a conference call with analysts.As part of the plan, the company will simplify its regional structure, dividing the world into just two regions, the Americas and the rest. It will also pull out of between 10 and 20 countries where its margins are too slim to make a profit, Russo said. In those countries it will pursue &quot;an alternative strategy where we can continue to support customers but through different means,&quot; she said.For the quarter ended Sept. 30, the company reported revenue of &#8364;4.35 billion, a fall of 11.4 percent compared to the &#8364;4.91 billion that the two companies made a year earlier. Alcatel-Lucent provided comparable figures for the companies&#39; performance before their merger on Dec. 1.Currency fluctuations hurt the company&#39;s performance: the decline in revenue would have been 7.8 percent at constant exchange rates.Alcatel Lucent remains in the red, with a loss of &#8364;345 million this quarter, or &#8364;258 million excluding restructuring charges, compared to a comparable net profit of &#8364;532 million for the companies a year earlier.Alcatel-Lucent is still hoping for a &quot;solid ramp up in revenue&quot; in the fourth quarter, but seems less optimistic: it now says revenue for the full year will remain flat, rather than &quot;flat or slightly up&quot; as it predicted last month. The company offered no guidance on earnings for the full year.Revenue from the company&#39;s largest business segment, carrier networks, dropped 15.2 percent year on year to &#8364;3.14 billion, while operating profit for the segment fell from &#8364;389 million to &#8364;22 million. Alcatel-Lucent said the decline was exaggerated by the comparison with unusually strong sales of CDMA (code division multiple access) wireless networks in North America in the third quarter last year, as operators rushed to deploy a performance-enhancing software upgrade.The company has converged two of its three CDMA platforms since the start of the year, and expects to merge the remaining two by the third quarter of next year, Russo said. Going forward, it will focus research and development spending on new revenue opportunities such as the transformation of wireless networks to all-IP systems.As part of its restructuring, the company will eliminate a layer of management, merging the wireless, wireline and convergence networks divisions of the carrier networks business segment.Services revenue remained flat at &#8364;777 million, while operating profit in that sector fell to &#8364;40 million from &#8364;60 million a year earlier. The company sees services around the delivery of IPTV (Internet Protocol television) programming as a strong area.One bright spot was the company&#39;s enterprise networks business, where revenue rose to &#8364;380 million from &#8364;362 million a year earlier, with operating profit rising to &#8364;29 million from &#8364;24 million a year earlier. The move by businesses from traditional switched telephone systems to VOIP (voice over IP) on internal networks was a key driver, the company said.This article was updated with new information on October 31, 2007.
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NEW YORK---Tenet Healthcare Corp. said Tuesday its loss narrowed in the third quarter, as the Santa Barbara-based operator of acute-care hospitals significantly reduced its loss from continuing operations.
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Many Valley retirees who thought they would have lifetime health care have learned the hard way that companies are cutting back or eliminating their benefits altogether.
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The 67-year-old retired print technician doesn&#39;t make enough in Social Security to cover prescription drugs for his stomach ulcer and his wife, Delores&#39; bone density problems.
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Retirees for a third straight year are paying double-digit increases for healthcare coverage through their former employers, which are shifting a greater
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So you're about to retire. You've got your finances in order and your health care in hand. But have you written a mission statement for your life? Sat down with your spouse and written post-retirement job descriptions? Discovered your retirement path? If not, you'd best get busy.
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Thousands of gravely ill older people will no longer have to spend their savings or sell their homes to pay for round-the-clock medical care, under government guidelines to be revealed this week.
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A new regulation allows employers to establish two classes of retirees, with more comprehensive benefits for those under 65 and more limited benefits â or none at all â for those older.
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As many of the nationâs largest employers struggle to control rising retiree health costs, they are asking their retirees to pay more and plan to do so again in 2005, according to new survey results.
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Big U.S. businesses will in general maintain retiree health benefits next year despite fears they would be cut to compensate for benefits to the elderly in the new Medicare law, a survey found.
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Big US businesses will in general maintain retiree health benefits next year despite fears they would be cut to compensate for benefits to the elderly in the new Medicare law, a survey found.
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Doctors who treat the elderly and disabled will face a 10 percent cut in their reimbursement rates from Medicare next year under a federal rule issued Thursday.
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Cardinal Health Inc., a medical products and services company, plans to cut 4,200 jobs, or about 7 percent of its work force, and close 25 offices as part of a three-year restructuring plan, the company said Monday.
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Goodyear Tire & Rubber Co. said on Wednesday it would freeze pensions and require salaried retirees in the United States to contribute more for health coverage to cut costs.
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Lucent Technologies, the nation&#39;s biggest telecommunications equipment maker, said yesterday that the Securities and Exchange Commission was considering suing three former executives over possible