Reuters sinks after jobs cuts

LONDON, June 20 (CNN) -- Reuters, the world's biggest financial news and information provider, plans to cut another 650 jobs as investment banks sack workers to counter sagging markets.

Its stocks, which has more than halved in value this year, fell 8.1 percent to an nine-year low of 371.1 pence in midday London trading on Thursday amid concerns that the move indicated revenues were under pressure.

"They're having to cut additional costs to stand still," Michael Picken, analyst at Credit Suisse First Boston, told Reuters.

The latest round of job cuts comes on top of the 1,800 already announced as Reuters battles to control costs and its clients curtail spending. Reuters said the job cuts would be concentrated on senior and middle management and should enable it to save an extra £100 million ($150 million) a year.

Analysts at Schroder Salomon Smith Barney have estimated the investment banking industry has axed about 60,000 jobs since the beginning of this year, as mergers activity slumped after the dotcom bubble burst.

Reuters and privately owned Bloomberg provide financial news and market data to professionals in the financial sector. Reuters news and data reaches more than 558,000 desktops, many of them in financial institutions, including investment banks, brokerages and fund managers.

"While market conditions remain challenging, I see tangible progress being made towards meeting our 2002 targets," Reuters' Chief Executive Tom Glocer said in a statement. "The accelerated cost savings initiatives we announce today will improve our 2003 margin beyond 12 percent in advance of a general market recovery."

The job losses are expected to cost £100 million in calendar 2002 but achieve £20 million in additional savings this year, Reuters said.

The company has said previously its cost cutting programme would save £235 million by 2003. Reuters said in October last year it planned to cut its dividend payment and invest profits to reach a five-year goal of sustainable double-digit profit growth and fatter margins.

Reuters currently employs 19,000 staff in 97 countries and had revenues of £3.9 billion in 2001.