Invensys cuts 2,500 jobs

Invensys says it's facing "extreme trading conditions"

UK electronics and engineering group Invensys is to cut 2,500 jobs worldwide due to "extreme trading conditions".

The redundancies mean the company - which employs 80,000 people worldwide - is now on course to cut 6,000 jobs this year.

Invensys warned that first half operating profits are expected to be 30% below its original forecasts.

The company's chief executive Allen Yurko has also announced that he will retire at the beginning of next year.

Slowdown bites

Invensys said it has been hit by the slowdown in the US economy, and the downturn in the technology sector.

"It is now obvious we are seeing the worst recession in US industrial production since the 1970s," the company said in a trading statement.

Invensys Chief Executive Allen Yurko is to retire

"The dramatic decline in global telecoms and the spreading economic slowdown is impacting all our businesses".

As a result, Invensys is now planning to cut a further 2,500 jobs.

It had already announced plans to shed 3,500 staff this year, so it's now on course to lose 6,000 in total.

When it announced its full year results in May, the company said it expected first half operating profits of about £400m ($569m).

But now it expects first half operating profits to come in 30% below its own initial forecast, and about 20% below what City analysts were expecting.

CEO to retire

Mr Yurko said he will retire in January 2002 after eight years in charge.

He said: "I felt the time was right to hand over to someone able to bring a fresh approach to our markets, build support for his strategy with the financial community and lead Invensys as it comes out of the current economic downturn."

He will be replaced by Rick Haythornwaite, who was chief executive of the cement group Blue Circle until it was bought by the French company Lafarge earlier this month.