GLOBAL - DTZ has warned there is likely to be a "significantly greater" profit loss for the year to the end of April 2009 than expected, and is subsequently continuing to restructure the business in a bid to cut costs.
The worsening economy, lower investor confidence and the decline in commercial property transactions has forced DTZ to review its underperforming operations and shut down its offices in Portugal and Austria.
In its interim management statement, DTZ said: "Since December, as illustrated by the steep decline in stock markets and economies across the world, there has been a significant ongoing deterioration in trading conditions and the board's current view is that the group will report a loss before taxation and exceptional items for the year to 30 April 2009 significantly greater than previously anticipated."
DTZ announced, in its half-year results in December 2008, it had seen a £9m (€9.7m) pre-tax loss since the end of October 2007 and an increase in net debt to £74.6m.
As part of its restructuring, DTZ has accelerated its cost-cutting measurements to save £15m for the year to 30 April 2009 along with a further £15m for the following financial year and said it expects to save an additional £20m by April 2010, bringing its total potential saving to at least £50m.
To simplify the reporting structure, the firm has created an executive committee which will report to group chief executive officer Paul Idzik and oversee the financial performance and management of the business.
Following the conclusion of the fundraising last January, Killian O'Higgins, Robert Peto, David Gray, Dag Detter and Les Cullen resigned from the board and Frank Piedelièvre, Pascal Derrey and Françoise Tardan have been appointed non-executive directors.
In addition, the group has appointed Bob Rickert, chief operating officer, to the additional post of chief financial officer following Colin Child's decision to step down from his position as finance director. Child is to leave the company with immediate effect.
The group began fundraising in December 2008 to keep the company afloat and strengthen its balance sheet and raised £48.7m of equity through new shares.
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