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American Express slashing more jobs Financial firm plans to cut an additional 5,500 to 6,500 workers

NEW YORK, Dec. 12 — Financial giant American Express, hit hard by the drop in travel following the Sept. 11 attacks on the World Trade Center, said Wednesday it would eliminate 5,500 to 6,500 jobs at a cost of $240 million to $280 million in severance fees and other restructuring charges in the fourth quarter.

THE COMPANY, WHICH is headquartered in New York, also warned that its earnings in the October-December period were likely to be in a range of 34 cents to 36 cents, below the 40 cents expected by analysts surveyed by Thomson Financial-First Call and considerably less than the 50 cents recorded a year earlier.

Shares of American Express were off $1.46, or 4 percent, to $32.80 in early trading on the New York Stock Exchange.

The latest layoffs come on top of 7,700 cuts previously announced this year. Altogether, the 13,200 to 14,200 jobs eliminated amount to a 15 percent reduction in the American Express staff, which totaled 88,500 at the start of 2001. Cuts are taking place primarily in the travel businesses and reflect the sharp slowdown in that sector since Sept. 11, the company said in a statement. It added that about half of those to be laid off in the latest round already have been notified, with the balance to get pink slips in 2002.

“The environment since Sept. 11 has underscored the need for us to create greater flexibility in our cost structure so we can be more adaptable to a period of economic uncertainty,” said Kenneth I. Chenault, chairman and chief executive. American Express said it expected to save up to $260 million in 2002 as a result of the latest cutback.

The company said its reduced fourth-quarter earnings “reflect the impact of the Sept. 11 terrorist attacks on the financial markets, travel, corporate spending and the overall economy.”

It said that travel billings were down 14 percent in September from year-earlier totals, 10 percent in October and 6 percent in November. Sales also were down at American Express Financial Advisors, the statement said. “Credit trends are likely to show a modest deterioration, reflecting the increase in unemployment and the overall industry environment,” it added.

-- Anonymous, December 12, 2001