1,800 Jobs to Go at Emi

EMI, the world's third biggest music company, today announced it was cutting 1,800 jobs and halving its dividend in a bid to revive its flagging fortunes.

The job cuts include 192 positions to be lost through the closure of a CD manufacturing plant in Swindon, Wiltshire. Details of that move emerged earlier this month after EMI said it needed to consolidate the operation into a larger one in the Netherlands because of excess capacity in the CD manufacturing sector.

All the jobs will go from EMI's recorded music division, in which the company employs 10,000 staff. An EMI spokesman said the redundancies would be across its operations in 50 countries.

EMI stuck to its 2001 pre-tax profit forecast of £150m after two profit warnings in the last six months. EMI, hit by a decline in music sales during last year's economic slowdown, lost £2m in the March to September period last year, down from a £59m profit 12 months earlier.

The company expects the changes will generate savings of £99m a year, although the redundancies will also create a £110m exceptional charge in this year's financial figures.

On top of the cost for the revamp, EMI is also taking a £92m hit related to the write-down of loss-making investments and other asset write-offs. Rounding off EMI's litany of woes, is an exceptional charge of £38m pounds for ending Mariah Carey's contract.

EMI, home to Kylie Minogue, Robbie Williams and Mick Jagger, has struggled after seeing two merger attempts - with Warner Music and BMG - fall through, and some of its multimillion dollar stars fail to score hits.

EMI sacked some of its top executives last year and brought industry guru Alain Levy on board to turn around the group. Mr Levy has spent the last six months looking for savings and has made management changes and restructured EMI's top labels.

Eric Nicoli, the EMI chairman, said the plans to reshape the company's recorded music division would put the London-based group "back on a growth track".

He added: "The restructuring plans revealed today will transform the performance of this part of our business."

EMI shares slipped 0.29% to 345p in early trading after a strong rally last week on hopes of savings from the revamp.