McClatchy (MNI) Announces 10% Workforce Reduction; Reports Decrease in May Sales
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The McClatchy Company (NYSE: MNI) plans to reduce its workforce by about 10% as the company accelerates efforts to manage through today's difficult advertising market and position itself for future success in an increasingly competitive environment.
McClatchy said it is reducing workforce through both voluntary and involuntary separations, as well as managed attrition, involving about 1,400 full-time equivalent employees (FTE's). The company will retain its strategic focus on sales, news and online operations as it realigns operations, with decisions about the size and profile of changes differing by location.
The moves announced today will produce annual savings of about $70 million from staff reductions as part of a plan to reduce overall expenses by $95 million to $100 million over the next four quarters. Combined with previous expense control initiatives, the company expects to reduce non-newsprint cash expense in the low double-digit percentage range over the balance of 2008 excluding severance costs of about $30 million.
Separately, McClatchy reported that consolidated revenues in May 2008 decreased 15.1% and advertising revenues were down 16.6% compared to revenues in May 2007. The Company noted that the declines in print advertising were partially offset by a 12.9% gain in online advertising revenues in May 2008 compared to May 2007. For the first five months of the year, total revenues declined 14.2% and advertising revenues declined 15.4%. Online advertising grew 11.9% in the first five months of 2008.
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