Posted on 05/28/2008 2:24:09 PM PDT by abb
The St. Petersburg Times will offer an enhanced retirement option to reduce its payroll and, depending on response, could resort to layoffs later this year. The newspaper also is imposing a one-year wage freeze for remaining employees.
In a letter to staff, Times editor and chairman Paul Tash said the measures were a response to a “difficult economic climate” that has been especially hard on advertising, the largest source of newspaper revenue. Over the last two years, the Times’ fulltime staff has dropped from more than 1,500 to fewer than 1,300, mostly by attrition.
“We are navigating a period of historic change and challenge,” Tash said. “Getting through this stretch will not be easy, and it will take everyone’s best efforts, but I remain fully confident about our prospects."
ping
Extreme leftwing paper. Good!
Paul C. Tash Editor, CEO and Chairman
May 28, 2008
Dear Colleagues,
As you know, we are navigating a period of historic change and challenge. The new architecture of the daily Times – known internally as Project Flagship – is a major effort to adapt our efforts to the needs of our customers while reducing our expenses. I am extremely encouraged by the early reaction and results.
The new daily edition, in combination with other steps we have already taken, requires fewer people to produce it. Over the last few years, we have relied mostly on attrition – the routine departure of people to other jobs, other places or retirement – to reduce the size of our staff. Two years ago, the Times employed more than 1,500 fulltime staffers. Today, that figure stands below 1,300. Nevertheless, payroll and benefits remain our biggest single expense.
The recent changes to the daily Times provide the opportunity to further reduce staff levels, and this difficult economic climate demands that we move faster than the pace of normal attrition.
As a result, the company will offer a program of enhanced pension benefits for eligible staffers who sign up by July 28 and retire by Aug. 31. The Human Resources department will provide complete information about this program, with specific detail for staffers who are eligible: those at least 50 years old, with at least five years of service. Once this offer expires, the standard retirement benefits resume.
In my view, this voluntary program is a graceful and humane way for the company to reduce its staffing levels. I believe it will be attractive to many staffers, especially to some who may be considering retirement already. Depending on response, however, we may still need further reductions in our payroll costs, and that could include lay-offs. We would come to that result with reluctance, having taken other steps.
Those of us who remain Times staffers – and that will be the great majority of those on the staff today – will make our own contribution to the common good by giving up pay increases for one year. Starting this coming Sunday (June 1), there will be no raises except for staffers promoted to new jobs with bigger responsibilities, and those exceptions must be approved personally by Marty, Neil or me. Those who have already received raises this year will forego them in 2009.
In a time of rising prices for medical care, fuel and food, I understand that this pay freeze will cause hardship for some staffers. I deeply regret that reality, but as staffers, our economic security depends ultimately on the health of our company. For Times executives, a pay freeze has been in place since the beginning of this year. To honor my personal responsibilities, I have instructed the finance department to reduce my pay by five percent while this freeze is in place.
You would be right to see these actions as a measure of the challenges before us. Some of you know my aversion to a general pay freeze, for example, though I have come to believe that circumstances require it. And yet, as difficult as these steps are, they also demonstrate our resolve to meet these challenges and surmount them.
Getting through this stretch will not be easy, and it will take everyone’s best efforts, but I remain fully confident about our prospects. This is a great company, with a proud history and a strong voice in the Tampa Bay region. Thanks for your contributions to its future.
With appreciation and affection,
Gannett Loses Its S&P ‘A-’ Credit Rating: Industry Slump Hurting Even Best-Regarded Chains
By Mark Fitzgerald
Published: May 28, 2008 1:19 PM ET
CHICAGO Standard & Poor’s Ratings Services cut Gannett Co. Inc.’s corporate credit rating and senior unsecured debt rating to “BBB+” from “A-,” further evidence that the newspaper industry slump is affecting the credit ratings of even the best-regarded publishers.
With a debt load considerably lighter than most of its peers, Gannett had maintained top credit ratings even as the bonds of other publicly traded newspaper companies fell into junk territory or teetered on its edge.
S&P also assigned a negative outlook to Gannett debt, suggesting the rating could fall further.
“The downgrade of the long-term ratings reflects a worsening pace of decline in year-over-year advertising revenue at the company’s newspaper publications so far in 2008,” S&P credit analyst Emile
Courtney said. “The slowing U.S. economy will likely continue to exacerbate operating weakness at Gannett, and this comes at a time when the company and the newspaper industry in general have experienced prolonged operating weakness due to a secular shift in revenue away from print advertising.”
But Courtney added S&P continues to regard Gannett’s “business profile as investment grade, largely because of a geographically diverse portfolio of newspapers, about 83% of EBITDA (earnings before interest, taxes, depreciation, and amortization) in 2007, and television broadcasting properties, as well as the company’s healthy internal cash generation and high EBITDA margin in the high-20% area.”
S&P said its target for total debt to EBITDA is 2.5 times, and said Gannett’s ratio as of March was 2.3 times, “and we expect it to improve closer to the 2.0x area by the end of 2008 due to debt repayment, notwithstanding our belief that revenue and EBITDA could decline by a high-single-digit percentage in 2008.”
S&P added that it had assigned the “A-” rating on expectations that Gannett’s newspaper revenue would not slip more than by a mid-single-digit percentage in 2008. But it noted newspaper publishing revenue, including online, was down 10% as of April.
Mark Fitzgerald (mfitzgerald@editorandpublisher.com) is E&P’s editor-at-large.
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New, grimmer
outlook for the upfront
Total spending on television will be flat to down
By Kevin Downey
May 28, 2008
With the upfront TV ad market about to start, it’s beginning to look a lot gloomier.
Media buyers and forecasters are reluctant to guess how much money advertisers will spend. But one thing is certain: It isn’t going to be good for the broadcast networks.
Cable television will benefit from broadcasters’ slumping ratings but will probably see only a slight increase.
Now the overall upfront is expected to be flat to down from last year’s $24.5 billion across broadcast, cable and syndicated television.
Just a few months ago, the outlook was a lot rosier, with the broadcast networks expected to see some gains and the cable networks seeing major gains.
What’s changed?
For one, broadcast ratings have plummeted, leaving the networks with far less inventory to sell.
But more worrisome, advertiser demand has weakened with an economy that seems to worsen by the week, according to media buyers.
“I think demand will be down, partially due to whatever recession we may or may not be in,” says Larry Novenstern, executive vice president and joint managing director of newcast at Optimedia.
“The automotive marketplace is really bad, and other advertisers will be cutting back spending and moving more to cable. Everyone thinks overall spending will be down a bit.”
At best, Merrill Lynch analyst Jessica Reif Cohen expects spending to be up 1 percent, to just under $25 billion. But she thinks it could also sink, falling by as much as 8 percent if it turns into a bear market for ad sellers.
One key indicator for media buyers has been weakening demand in the scatter market, when inventory not sold in the prior upfront is auctioned off. A strong scatter market is typically read as an indicator of a strong upfront, a weak scatter market indicating a weak one.
The scatter market had been robust for months, but that was in large part because the supply of rating points was down, which meant that buyers were forced to book more spots to achieve prior years’ reach and frequency goals. It was less a case of strong advertiser demand.
Now, the supply of rating points is down but so is advertising demand. And with ratings down so much the broadcast networks will have an even tougher time getting higher prices over last year.
Network TV’s primetime rating in 18-49s tumbled 9 percent from the year-earlier period in the just-concluded broadcast season, according to a Magna Global analysis of Nielsen ratings. Only Fox posted an increase. Ad-supported cable was up 9 percent.
Most troublesome for broadcast is that ratings didn’t bounce back once the networks had original episodes back on the air around April following the end of the writers’ strike in February.
“Viewers disenchanted with the writers’ strike abandoned broadcast TV and tuned to cable or found other options to fill their time,” says Michele Toller, director of national broadcast at Empower MediaMarketing.
The broadcast networks’ 18-49 rating prior to the strike was a 15.4, according to the Cabletelevision Advertising Bureau. It dipped to 13.9 during the strike and to a 13 rating in the period after the strike ended.
Further, there’s no reason to bet they will bounce back in the fall, argues Brad Adgate, senior vice president and corporate research director at Horizon Media.
“You can’t give the networks the benefit of the doubt because ratings didn’t come back after the strike,” he says. “I don’t think there will be a spike because there never has been. Why would that start now?”
Further adding to the uncertainty of this upfront is the absence of any sense of urgency that’s been typical of past upfronts. That’s partly due to the expected shift in ad dollars to cable TV.
With broadcast, prime inventory is limited, so media buyers traditionally felt a need to rush in and lock it down. Cable has a relatively large supply of inventory, meaning buyers can pick over inventory until they get the rating points they need at the prices they want.
Most buyers say negotiations haven’t begun in earnest and probably won’t for another week or more.
“I don’t think it’s going to be a fast market,” says Toller. “Advertisers and agencies are going to be very methodical and take their time to evaluate and make the best selections for their clients.”
I like the new pic!
I can't decide if the pic of the grinning hyena looks more like Dr. Raoul or GrampaDave, lol!
This is that commie rag newspaper right?...oh...sorry..stupid question.
Co-anchor among 7 laid off at Channel 4
Station owner cutting 750 jobs nationwide
Friday, May 23, 2008 3:16 AM
By Tim Feran
THE COLUMBUS DISPATCH
Channel 4 has laid off seven people, including midday co-anchor Andy Dominianni, meteorologist Dave Trygar and five off-camera employees.
The layoffs are part of a companywide move by station owner Media General. The company based in Richmond, Va., announced yesterday that it is cutting 750 jobs, or 11 percent of its work force.
snip
http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_content_id=1003809234
Attendance Lagging, NAA Cancels Wall Street Presentations
By E&P Staff
Published: May 28, 2008 7:22 PM ET
CHICAGO With investors getting out of rather than snapping up newspaper stocks that are almost uniformly trading near 52-week lows, the Newspaper Association of America (NAA) has quietly canceled its Mid-Year Media Review presentation to Wall Street analysts.
Instead, newspaper companies will be part of the Deutsche Bank Media & Telecommunications Conference in New York City, scheduled for June 9-10.
The cancellation was first reported by Reuters in a story by Robert MacMillan.
Reuters quoted an NAA spokesperson as saying attendance at its annual analysts presentation had dropped 24%, to 254 people not counting journalists, since 2005.
There are no plans to schedule a Mid-Year Media Review in 2009, added the spokesperson, who did not immediately return an E&P message for comment left late Wednesday.
The hits just keep on coming. On the positive side, I’m willing to bet local alcohol sales in these major media markets are way up due to the continuing deluge of bad circulation/advertising news.
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