Directory business Yellow Pages Group is cutting about 125 jobs, mainly from its sales force, in a move designed to prioritise online searching over its traditional printed directories.



Chief executive officer Scott Pomeroy confirmed the cuts amounted to about 20 per cent of Yellow's overall workforce.



The American executive, who took Yellow's reins from Bruce Cotterill just over a year ago and also sits on the board of directors, denied the decision was due to balance sheet pressure.



''It has everything to do with the strategy we're moving into and is not a consequence of cost-cutting because we're not under pressure from a profitability [point of view], there are no issues like that that are pushing us to make decisions.''



However in November last year the company revealed it had slashed the value of its goodwill by $329.3million, written off $8.5m on an irrecoverable investment in software and provided $12.8m in its accounts for doubtful debts relating to customers in ''unexpectedly difficult economic conditions''.



That result for the five months to June came after a prior $1.6b impairment of intangible assets in the year to June 2010 leading to a loss of $1.4b.



Private equity buyers Unitas Capital and the Canadian Teachers' Private Capital had bought Yellow from Telecom for $2.2b in a heavily leveraged deal, and eventually sold it to senior lenders at the end of 2010.



With experience in directory businesses in the United States, Pomeroy was handed the task of turning the ship around just over a year ago and said today he believed the current capital structure would serve the business well through a ''significant transformation''.



Pomeroy said the staff changes would mean the traditional ''book-centric'' sales model could be broken down and made more efficient.



A smaller sales staff would offer all of the company's print and online services _ including Yellow Pages books, online search engines Yellow.co.nz, Finda.co.nz, and the reselling of Google search advertising _ via fewer meetings with each business customer, he said.



Yellow Pages said consultation was underway with around 125 staff located in Auckland, Hamilton, Tauranga, New Plymouth, Palmerston North, Napier, Wellington, Christchurch and Dunedin.