Cable & Wireless Worldwide cut its full-year forecasts yesterday, claiming savage public sector spending cuts in the UK has hit business hard.
The UK-based carrier said ebitda would likely fall at the lower end of its forecast of £452 million ($691m) to £484 million, and that it was accelerating cost-cutting schemes in a bid to reduce operating expenses for full-year 2010.
“Non-contracted spending in the UK public sector has slowed very significantly,” the firm said in a statement, noting that the slump will “adversely impact trading in the current year.”
UK public sector contracts accounted for 12% of group revenue in 2009, FT.com reported.
The new British government unveiled heavy spending cuts in an emergency budget last month, aiming to shed £113.5 billion from public sector spending over the next five years.