Fund manager to shed 500 jobs

Falling markets have led to falling revenues

The Anglo-US fund manager Amvescap has said it is to trim 500 jobs as part of a £100m cost-cutting drive.

Amvescap, which employs 7,900 people worldwide including 1,150 in the UK, did not specify where the job cuts would fall.

The company announced the cuts as it reported pre-tax profits before one-off items of £70.7m for the July to September period.

The figure was down 36% on the same period last year, but was better than analysts had expected, and Amvescap's share price closed up more than 16% at 384p in London.

Revenues down

Amvescap operates under the AIM, Invesco and Atlantic Trust brands.

Like the rest of the fund management industry, the company has suffered from the turbulence on the world's stock markets over the past couple of years.

Pre-tax profits before one-off items for the first nine months of the year were £263.2m, compared with £380.8m for the same period last year.

Revenues for the nine months dropped to £1.05bn, from £1.24bn last year.

The company has shed 1,000 jobs since the end of August last year, but now says more cuts are necessary.

"In response to the difficult market environment of the last two years, we have steadily adjusted the size of our operations," said executive chairman Charles Brady.

"We have initiated a cost reduction programme that will further reduce operating expenses by approximately £100m by the end of 2003."

Amvescap said it would take a £40m charge in the October to December quarter to allow for redundancies and other costs.

"The total programme will be about 500 positions... all yet to go," said Amvescap's chief financial officer, Bob McCullough.

"We keep hoping for that market correction but we can't just sit here today and predict the future," he added.