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Job cuts to continue at Perpetual

Job cuts to continue at Perpetual

Fund manager Perpetual will cut more jobs next year as it continues with a major restructure that contributed to a 57 per cent drop in its full year profit.

The company on Thursday announced a $68 million deal with Fujitsu Australia to outsource its IT needs from 2013, which would lead to about 100 job cuts.

Under changes that began in 2011, which have been accelerated since new chief executive Geoff Lloyd was appointed in February, Perpetual has already removed 527 full-time employees from its business.

Its executives have also taken pay cuts and companywide bonuses have been culled.

The restructure is aimed at achieving $50 million in pre-tax savings each year from 2015.

But the program resulted in one-off costs of $22.6 million in the year to June 30.

When coupled with a fall in its underlying performance due to weak share markets and investor confidence, Perpetual's net profit for the year to June fell by 57 per cent from the previous year to $26.7 million.

Mr Lloyd said the company faced a big challenge in successfully carrying out its restructure, which he has called Transformation 2015, to deal with subdued financial markets.

"While first steps have been taken towards fundamental improvement, it was not sufficient to match the difficult environment our industry currently is in," he said.

"We have strong credentials and capabilities, but we need Transformation 2015 to accelerate our progress and deliver permanent benefits for the company and its shareholders.

"Clearly, there is a significant task ahead for Perpetual."

Perpetual's changes did deliver stronger profit margins on its revenue in the year to June, but depressed financial markets resulted in a drop in revenue.

The company's investment funds under management continued to fall, down 17 per cent in the year to June to $22.6 billion. The company offered minimal outlook on global investment markets, only to say that Europe's debt woes would need to be resolved before any significant rise in financial markets can be sustained.

The company declared a fully franked final dividend of 40 cents per share, down from a 90 cent final dividend 12 months earlier.

Perpetual shares were down 47 cents, or 1.7 per cent, at $26.55 at 1420 AEST.

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