Vodafone due to see '£20bn loss'

Mobile phone firm Vodafone is expected to reveal annual pre-tax losses of about £20bn and announce hundreds of jobs cuts, Sunday newspapers reported.

Cost cutting - part of wider changes - could mean 6,000 workers would lose their jobs, said the Sunday Telegraph.

About 500 could be axed at the group's Newbury headquarters, the paper said.

The firm has been under increasing pressure to improve its sales growth. In February, the firm warned its assets were overvalued by as much as £28bn.

The firm has already said it expected sales growth to fall in 2007.

"We believe Vodafone has room to announce 10% headcount cuts and 15% cost savings in IT and network operations through outsourcing," said banking firm Lehman Brothers, reported The Sunday Telegraph.

New strategy

It is expected Vodafone's new strategy will target landline users to switch to using mobile phones, as well as offering customers high-speed internet access over landlines.

The firm will extend a low-cost mobile service to European customers, including the UK, newspapers said.

The service, already available in Germany, allows customers to use their mobiles to benefit from rates similar to those on landlines if they are within 2km of their homes.

Dividing business

The firm is overhauling its operational structure in an attempt to exploit changes in market and customer trends.

Vodafone has said that simplifying its business would give it a clearer focus and an increased emphasis on managing costs.

Both the earnings and strategy are set to be announced on Tuesday.

Vodafone was not immediately available for comment.

Source:- BBC News