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Turning down to economic news, the prognosis continue to be very bad.  As we told you Tropic Air is laying off 220 of its 380 employees, and BTL is in talks with its union for across the board paycuts that could go as high as 15%.  

This evening we spoke to CEO Ivan Tesecum via video conference about the company’s review of all operations and every expense line - from salaries to staffing:

Ivan Tesecum, CEO, BTL/Digi
"Our economy is already going through some economic impacts and Digi is no stranger to that. So we have looked at our overall cost base, rationalizing expenses and that means we are reviewing every single expense. We also expect that maybe multiyear for us to recover and so all of these things have to be put into the context of everything that is happening as well locally in Belize and also looking at what happens to the US because we know that tourism has definitely impacted the Belizean economy and certainly that then impacts Digi because we offer services to all sectors of this economy."

Jules Vasquez
"You all have cut salaries across the board that you all have cut general staff, cut 15%, managers cut 20% and heads of department cut 25%. Would you speak about that?"

Ivan Tesecum
"Sure, so what I can say from management is that we have taken a management initiative whereby managers have taken between a 20 and 25% salary cut for 3 months and that also includes with regards to vehicle allowance and vehicle maintenance for a 3 month period and also bonus as well that bonus for this year is foregone. In terms of staff, we are in a negotiating process with them and therefore that has not materialized but we are in discussions."

Jules Vasquez
"Will BTL have to entertain the possibility of layoffs? I believe you all have more than 500 staff and we know for example, a large employer like Tropic has laid off 200. Is that something that you all may have to entertain as a part of cost cutting survival measures?"

Ivan Tesecum
"Certainly like any organization, we are all dimension for a certain level of demand given the decline in demand for our services at this point in time, we have what you call structural overcapacity, so as the months go by, as the data comes in, that is being analysed and certainly we will do everything in our power to look at this not happening but certainly if it is very prolonged and if the impact is even greater then certainly we will have to revisit that position."

Jules Vasquez
"Is the company in jeopardy in so far as it reinvent itself in a much more streamline fashion rather than being big BTL we've all come so accustomed to?"

Ivan Tesecum
"In terms of reinventing ourselves, every single organization will have to reinvent itself. This whole talk about a new normal is coming and we will never go back to being the old BTL, we are going to have to be more efficient at what we do, we're going to have to do more with less and we're going to have to reinvent in being a solution provider as opposed to being a telecom provider. So, I think that is the future for Digi, there will be a relearning, a reskilling of the staff in being a solutions provider as opposed to just a telecom provider."

Jules Vasquez
"But you won't need to have more than 500 employees as you do now."

Ivan Tesecum
"Exactly, so those are the tough questions that come at the end of the day."

Jules Vasquez
"So last financial year, your gross revenues were 163.5 million. What sort of fall off do you expect percentage wise in those revenues?"

Ivan Tesecum
"Our revenues, we are looking at somewhere about 20%."

Very interestingly - one thing Tesecum says Digi does not have to worry about is that 25 million dollar GST bill - which was under investigation by the Tax Services Department.  DIGI was never formally assessed for the amount, but a review by the tax department came up with that figure based on inter-company transfers of certain sale items.  

It was an item of dispute by both lawyers and accountants, and Tesecum told us it has been put to rest. He said, quote, “We don’t owe any GST and that matter has been settled in writing from The Belize Tax Service Department.  The transactions that were under query (were found to) comply with the GST Act.