Brazil's Eletrobras expects job cuts to save $441 mln per year

Reuters

SAO PAULO, Nov 18 (Reuters) - Brazilian state-runelectricity utility Eletrobras expects to save 1billion reais ($441 million) a year as a result of its employeebuyout program, Chief Financial Officer Armando Casado de Araujosaid on Monday.

The program will cost the company about 1.5 billion reais inseverance costs, Araujo said in a conference call with analyststo discuss third-quarter earnings.

Eletrobras agreed in December to a government plan to renewexpiring hydroelectric dam concessions in exchange forelectricity rate cuts of between 18 percent and 32 percent.

The company posted a net loss of 915 million reais for thethird quarter as it overhauled operations following the tariffreductions, according to a securities filing on Thursday.

Earlier this year, the company said it planned to cut 5,000jobs as it embarks on a three-year turnaround effort aimed atslashing costs by 30 percent.

Shares of Centrais Eletricas Brasileiras SA, as Eletrobrasis formally known, fell 1.2 percent to 10.69 reais in lateafternoon trading, paring early morning losses of as much as 3.3percent.

Brazil's stock market was closed on Friday for a nationalholiday.

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