More Redundancies At Cap Gemini

The company, which has already slashed headcount by 5,400, is expected to post flat or lower margins compared to the second half of last year.

Analysts expect that any further headcount reductions will come from those countries where the firm is weakest, which includes the UK and Italy.

The company's problems have been caused in the main by client companies in the services market continuing to put large IT investment projects on hold.

Although the firm's European business has continued to show weakness, activities in the US are beginning to look better. Cap Gemini increased its exposure to the US two years ago when it acquired the consultancy arm of Ernst & Young.