ECONOMY

Deutsche Telekom aims to cut OTE costs

Deutsche Telekom, which owns 30 percent of OTE telecom, plans to cut costs at its Greek subsidiary as a means of boosting profitability.

‘There are still a few structural challenges to resolve in the landline business,’ the European head of Deutsche Telekom, Guido Kerkhoff, told business daily Financial Times Deutschland in a report published on Monday.

Staff costs accounted for 37 percent of OTE’s turnover, compared to just 20 percent for Deutsche Telekom, Kerkhoff said. After unveiling a 23.5 percent drop in third-quarter earnings in November, OTE CEO and Chairman Michael Tsamaz said that much needs to be done to reform the organization and ‘complete its transformation into a market-driven competitor with a rational cost structure.’ Shares in OTE fell 1.42 percent on Monday to 6.27 euros, bringing its market value to 3.07 billion euros. The broader market dipped 2.77 percent.