Postmedia to cut staffing costs by 20%
Postmedia Network Canada Corp. says it intends to reduce staffing costs again as the company reports lower revenue and a deeper quarterly net loss.
The company, which currently has about 4,000 employees, says it plans to cut costs through staff buyouts over the next few weeks, adding that layoffs are possible if its target isn't met.
"We intend to undertake additional cost savings initiatives throughout fiscal 2017 including a company-wide voluntary buyout program aimed to reduce compensation expense by 20 per cent," the company said Thursday as it released its fourth-quarter financial report.
The media company said the job reductions will come from all levels and operations across Postmedia, adding that staff will have until Nov. 8 to apply for the buyouts.
According to Unifor, which represents workers at several Postmedia outlets, employees will be eligible for three weeks of pay for each year served with the company, up to a maximum of 78 weeks.The payout will be capped at $150,000 and paid out as a salary continuance in place of a lump-sum payment, Unifor says.
Postmedia announced 90 job losses in January as it merged newsrooms in some cities.
"Postmedia has had some of these before, the Globe and Mail has had some, other news organizations have had them," said Christopher Waddell, a journalism professor at Carleton University. "It's been a continuing trend, all driven by the fact that advertising revenue keeps falling, and that's what covers the costs of a lot of newspapers."
The business said its fourth-quarter revenue declined to $198.7 million from $230.2 million in the same quarter last year. The company blamed lower advertising revenue and circulation revenue from its print division for the drop,
Postmedia's digital revenue rose by 0.8 per cent, but Waddell said that is not nearly enough to offset some of the losses on the print side.
Automotive print ad revenue down
As part of its quarterly financial presentation to analysts, the company said the largest decline in its print advertising revenue was in the automotive category, which accounted for 37 per cent of the drop.
Postmedia said it had a net loss of $99.4 million for the quarter, compared with $54.1 million in the same period in the previous year, with company blaming a wider operating loss for the difference.
"We must accelerate the transformation of our business operations to align our cost structure with our revenue outlook," CEO Paul Godfrey said during a conference call with analysts and the media.
For its full financial year, Postmedia lost $352.5 million, or $1.25 per share, on revenue of $877.2 million. In the previous year, it lost $263.4 million, or $1.98 per diluted share, on $750.3 million in revenue.
