Embarq Hopes to Cut 200 Jobs: If Volunteers Don’t Come Forward, Company Will Try Other Strategies to Reduce the Work Force.

By Jason Gertzen, The Kansas City Star, Mo.

Feb. 10–Embarq Corp. on Friday asked for 200 workers to leave voluntarily or the Overland Park company will resort to other job-cutting actions.

The majority of the 200 job cuts are expected to take place in the Kansas City area.

“We always look for ways to increase our efficiencies and drive costs out of the business,” said Charles Fleckenstein, an Embarq spokesman. “Adjustments go on all the time.”

Embarq, which spun off as a stand-alone company from Sprint Nextel last May, is offering two weeks of pay for each year of service and other benefits. The job cuts are to be completed in the first quarter.

Company representatives confirmed the cost-cutting actions in response to questions from The Kansas City Star. This came a day after Embarq reported fourth-quarter financial results that included profits of $1.28 per share, which beat Wall Street expectations.

However, Embarq executives said Thursday that 2007 sales of phone service and other telecommunications services are expected to grow 1 percent to 3 percent. Investors responded Friday by driving Embarq shares down nearly 3.4 percent. They closed at $54.97, down $1.91.

Embarq serves 6.9 million phone lines across 18 states, but it has been grappling with steady declines as consumers obtain phone service from competitors.

“Growth concerns are likely their primary issue,” Dave Novosel, a senior analyst at Gimme Credit, stated in a report Friday.

Embarq executives earlier this week discussed expense management discipline and continual efforts to improve costs and productivity, but they did not reveal details about job-cutting plans.

Embarq’s work force now stands at about 20,000, with about 4,500 based in the Kansas City area. When the former Sprint local telephone unit was jettisoned by its parent company, it had about 19,700 workers.

“We have added 300 employees since we separated,” Fleckenstein said.

The requests for 200 workers willing to leave the company were presented in e-mails and meetings on Friday, Fleckenstein said. They affect various corporate units, including human resources and information technology.

Dan Hesse, Embarq’s chairman and chief executive, noted Thursday that company improvements could create opportunities for reducing call center workers. Fleckenstein said the 200 job cuts are not expected to include Embarq call centers.

An estimate of the expected savings from the reductions was not available Friday.

To reach Jason Gertzen, call (816) 234-4899 or send e-mail to jgertzen@kcstar.com.

—–

Copyright (c) 2007, The Kansas City Star, Mo.

Distributed by McClatchy-Tribune Business News.

For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

NYSE:EQ, NYSE:S,