Cable & Wireless cuts costs as income dives

Cable & Wireless, the telecoms company at the heart of a row over executive bonuses, today said it would cut more costs in its bid to safeguard profitability

The company, which is Britain's second-biggest fixed-line phone company, is particularly targeting its Caribbean business for cuts as it suffers from the slowdown in the economies there.

Fixed-line minutes in the region fell 9% in the first quarter compared with a year earlier while average revenue per customer declined 8%. "In the face of this, we are accelerating and stepping up our cost-reduction programmes," said chairman Richard Lapthorne.

In its non-Caribbean business, which includes the UK, it is seeing a massive decline in the volumes of "voice minutes" from mobile phones and premium-rate numbers. The shortfall adds up to about £1 million of gross margin a month.

Shareholders at an annual meeting today were expected to give the board a rough time over its plans to extend its long-term incentive plan from March 2010 to a year later.