Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) yesterday reported to investors that its board of directors had approved an early retirement plan for employees that would lower the company's net profit by NIS 464 million in the current year.
The board of directors approved a budget for the deal in order to carry out a NIS 263 million streamlining plan in 2019. The budget is primarily for the retirement of 340 veteran and new tenured employees according to the terms of the collective wage agreement signed by the company and the employees in December 2006.
The Bezeq board of directors also approved a NIS 249 million provision for early retirement up until the expiry of the collective wage agreement at the end of 2021. The 94 Bezeq employees involved were transferred from the Ministry of Communications, when Bezeq first became a business entity in the 1980s.
Bezeq will post NIS 512 million in expenses for its cost-cutting measures in its 2018 financial statements, on top of the NIS 90 million listed in its reports for the first and second quarters of the year in respect of early retirement of employees.
Bezeq's net profit in the third quarter totaled NIS 234 million, 27% less than its net profit in the corresponding quarter last year. Operating profit was NIS 429 million, 21.1% less than in the third quarter of 2017. Third quarter revenue totaled NIS 2.3 billion, 5.3% less than in the corresponding quarter last year.
Published by Globes, Israel business news - en.globes.co.il - on December 17, 2018
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