USA Today publisher Gannett asks employees to go on unpaid leave
25 Mar 2009
Gannett Co., the publisher of USA Today, said it would enforce a second week of unpaid leave and ask higher-paid employees to take a salary cut after revenue fell 24 per cent in the first two months of the year.
Gannett had already asked most of its employees to take a week of unpaid leave during this quarter to help preserve jobs. In a memo to employees, CEO Craig Dubow wrote that the McLean, Virginia-based publisher, which owns a several newspapers around Central Ohio, is about to begin the second quarter without relief in sight from the economic downturn and revenue continues to fall. The company last year lost $6.65 billion on $6.67 billion in revenue.
''Our revenue numbers continue their downward slide and we have been faced with more difficult decisions,'' Dubow said in the memo. ''We are about to begin the second quarter without any real relief in sight from this unprecedented economic downturn.''
''As with our first program, we are doing furloughs to hopefully mitigate the need for layoffs and to preserve our operations in the face of these extraordinary economic times,'' Dubow added. ''We believe this is the best possible course, given the alternatives.''
The company also said it will temporarily cut salaries for some of its higher-paid employees. Gannett employs about 41,000 workers. The CEO and CFO would receive half their usual bonuses.
Gannett said on 18 March that ad sales may fall as much as 35 per cent this quarter at its flagship title, USA Today. Circulation revenue across its newspapers will climb about 1 percent through 31 March, CFO Gracia Martore said.
Union-represented employees aren't required to participate in the program, Dubow said. The publisher saved about $20 million this quarter through the first furloughs, said spokeswoman Tara Connell, who declined to specify what the expected savings were for the program announced today.
Gannett gained 21 cents, or 9.8 per cent, to $2.35 at 4:01 p.m. in New York Stock Exchange composite trading. The shares have lost 71 per cent this year.