Hawaiian Telcom yesterday laid off 50 to 60 managers, or about 10 percent of its management team, as part of ongoing cost cutting and restructuring.

Since October, Hawai'i's major phone company has eliminated more than 100 management jobs.

The layoffs come as Hawaiian Telcom tries to stem its losses from customers defecting to wireless and cable services.

The number of Hawaiian Telcom access lines fell 6.9 percent to 572,997 in the year to Sept. 30.

"We are in a rapidly evolving industry and a very competitive marketplace and we must adjust our resources to fit this environment," Michael Ruley, Hawaiian Telcom's chief executive said in a news release.

The latest cuts affected people in operations, sales and marketing, finance, legal and human resources. Affected employees will receive a severance package.

"The staff reduction will not adversely affect Hawai'i's consumers and businesses," Ruley said. "We believe these changes will establish a leaner company that will benefit Hawai'i's consumers and businesses.

"Staff reductions are never easy but this one was necessary."

EARLY-RETIREMENT PLAN

Hawaiian Telcom is also offering an early-retirement incentive package to 55 employees. The company asked eligible employees on Jan. 11 to make their decision by today. Those who accept will retire Feb. 1.

At the end of September, Hawaiian Telcom had 1,632 employees, including about 650 managers. That was down 202 positions from Sept. 30, 2006, according to a filing with the Securities and Exchange Commission.

A portion of those cuts came in response to early-retirement incentives offered by the company. Hawaiian Telcom also has cut costs by freezing its pension benefit plan for nonunion employees.

The reorganization is meant to align the company's structure with revenue while reducing organizational layers from the chief executive officer to front-line employees, Hawaiian Telcom said.

The company lost $29.5 million during the three months ended Sept. 30, compared with a $43.9 million loss in the year-ago quarter. The company attributed the improved results to lower operating costs and an income tax gain. During the quarter, revenues fell 3.4 percent from a year earlier to $120.4 million.

LAND-LINE LOSSES

Hawaiian Telcom's 6.9 percent drop in access lines was in excess of an industry average of 3.4 percent line losses in 2006, according to Federal Communications Commission data.

At Hawaiian Telcom the loss of land-line customers has been somewhat exacerbated by "back office" support system problems, which have limited the company's ability to launch new products.

Still, Hawaiian Telcom was able to launch faster versions of its high-speed Internet service during the last three months of 2007.

Hawaiian Telcom also recently sold its directories publishing business for $435 million — a move that improved the company's heavily leveraged financial position by reducing debt.

Reach Sean Hao at shao@honoluluadvertiser.com.