31st Jan 2006 07:00
Announcement 31 January 2006 CABLE AND WIRELESS PLC REORGANISATION AND BUSINESS UPDATE Cable and Wireless plc (Cable & Wireless) today 31 January 2006 announces anumber of changes to its structure and management along with a business update.The highlights are: * Creation of two self-contained operational units - UK (including Bulldog) and International - to reflect the differing characteristics of the two and the establishment of clear strategies for both; * Significant reduction in scope and role of the Group corporate centre; * Francesco Caio to continue in his role as Group Chief Executive until the start of the new financial year, after which he will step down, as the Group Chief Executive position will not be part of the new structure; * UK EBITDA (excluding Bulldog but including Energis) for 2006/7 is currently expected to be no higher than for 2005/6; * Confidence restated in medium-term target for the UK business; and * National Telcos continue to trade in line with expectations. Richard Lapthorne, Group Chairman, said: "Today's reorganisation marks asignificant step in the development of Cable & Wireless. The creation of thetwo operating units is the result of a huge amount of effort by the team and,in particular Francesco, who has worked closely with me to get us to thispoint. We have put in place the tools for the strategic repositioning of the UKbusiness, though the short term environment remains extremely challenging. Weare focused on operational delivery in all of our markets."Francesco Caio, Group Chief Executive, said: "Over the last three years we havetransformed Cable & Wireless from an unfocused business into a group of telecomoperators relevant in each of their markets. This has been achieved against abackground of unprecedented change in the industry. We exited unsustainablemarkets including the US and Japan and we have rebalanced the revenue mix inthe National Telcos towards the growth areas of broadband and mobile."In the UK, we have devised and started to implement the strategy for long termsuccess through scale, access and IP capability. Notwithstanding the continuedpressures, particularly in the legacy voice market, the robust performance ofthe former Energis business together with promising progress that is being madewith Bulldog means that we continue to have confidence in the medium-termfinancial objectives for the UK business announced last November."These moves over the last three years, together with the calibre of leadersthat we have attracted, create the right conditions for the reorganisationannounced today and enable the company to progress into what I regard as thenext natural phase of its development."Changes to Group StructureThe Group will divide its business into two operationally self-containedbusinesses, UK (including Bulldog) and International. This decision reflectsrecognition of the differing characteristics of the UK and Internationalbusinesses, the critical scale achieved in both, the quality of managementleading both businesses and the move into a phase of execution against agreedbusiness plans.As a result, the central functions of Cable & Wireless will be reshaped toensure the continuation of proper governance and control at the Group corporatecentre but will no longer operate shared services for the two business units.New Management StructureFrancesco Caio will continue as Group Chief Executive until the start of thenew financial year after which he will work with Richard Lapthorne to ensurethe successful transition of the organisation to the new structure. As part ofthis new structure in the UK, John Pluthero is appointed joint Group ManagingDirector and Chairman of the UK from the start of the new financial year, andJim Marsh, Director of Retail, UK will assume the role of Chief Executive ofthe UK business. As a result of the decision to integrate Bulldog into the UKbusiness, both Emanuele Angelidis, Chief Executive Bulldog, and Jim Marsh willreport to John Pluthero.In International, Harris Jones is appointed joint Group Managing Director andChief Executive of International, again with effect from the start of the newfinancial year, and Lord Robertson of Port Ellen will become non-executiveChairman of International whilst remaining a Deputy Chairman of the Group. BothHarris Jones and John Pluthero will report directly to the Group Chairman,Richard Lapthorne.Business UpdateWhile the UK management team confirms the UK medium-term objectives announcedin November 2005, it currently expects that UK EBITDA (excluding Bulldog butincluding Energis) in 2006/7 will be no higher than in the current year. Theprincipal reasons are: * Continuing margin erosion, high levels of churn and the acceleration of the switch from legacy services to IP; * The impact of actions associated with the integration and realignment of the UK business; and * The reduction in non-recurring items, which are expected to make a major contribution in the current year and which primarily reflect the successful conclusion of a number of matters including billing disputes and negotiated settlements with suppliers for bandwidth, access and operations and maintenance services. The company intends to update the market on its progress to date with its UKplans on 28 February 2006. This will provide an overview of the integration,business improvement and wider transformation programmes that are now in place.In the third quarter, performance for National Telcos continued to be in linewith the positive trends seen in the first half and in line with ourexpectations.Conference call details:Cable & Wireless will host a conference call at 09:00 GMT today, Tuesday 31January. UK and international participants can join the call by dialling +44(0) 1452 561 395 and quoting reference 'Cable & Wireless conference call' from08:00. A replay facility will be available for one week. The replay can beaccessed on +44 (0) 1452 55 00 00, PIN 4936069#.For further information:Investor RelationsAshley Rayfield Acting Director, Investor Relations +44 (0)20 7315 4460 Craig Thornton Manager, Investor Relations +44 (0)20 7315 6225MediaClare Waters Director of Communications & Public +44 (0)20 7315 4088 Affairs Steve Double Group Head of Media Communications +44 (0)1344 726 946 Press Office Cable & Wireless +44 (0)1344 818 888 Rollo Head Finsbury +44 (0)20 7251 3801 Alice Macandrew Finsbury +44 (0)20 7251 3801About Cable & WirelessCable & Wireless is one of the world's leading international communicationscompanies. It provides fixed and mobile voice, data, IP (Internet Protocol) andbroadband services to business and residential customers, as well as servicesto other telecoms carriers, mobile operators and providers of content,applications and internet services.Forward-looking statementsIt is possible that this announcement could or may contain forward-lookingstatements that are based on current expectations or beliefs, as well asassumptions about future events. These forward-looking statements can beidentified by the fact that they do not relate only to historical or currentfacts. Forward-looking statements often use words such as anticipate, target,expect, estimate, intend, plan, goal, believe, will, may, should, would, couldor other words of similar meaning. Undue reliance should not be placed on anysuch statements because, by their very nature, they are subject to known andunknown risks and uncertainties and can be affected by other factors that couldcause actual results, and Cable & Wireless' plans and objectives, to differmaterially from those expressed or implied in the forward-looking statements.There are several factors which could cause actual results to differ materiallyfrom those expressed or implied in forward-looking statements. Among thefactors that could cause actual results to differ materially from thosedescribed in the forward-looking statements are changes in the global,political, economic, business, competitive, market and regulatory forces,future exchange and interest rates, changes in tax rates and future businesscombinations or dispositions.Cable & Wireless undertakes no obligation to revise or update anyforward-looking statement contained within this announcement, regardless ofwhether those statements are affected as a result of new information, futureevents or otherwise.No statement in this announcement is intended to be a profit forecast and nostatement in this announcement should be interpreted to mean that earnings pershare for Cable & Wireless for the current or future financial year wouldnecessarily match or exceed the historical published earnings per share ofCable & Wireless.ENDCable & Wireless PLCRelated Shares:
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