Gannett Lays Off Workers and Profits Soar? Great Success!
Newspapers aren’t dying; they’re committing seppuku. And it’s their corporate owners who are sharpening their swords.
Such is the plight of Gannett, the parent company of the News Journal. For the last couple of years, all we’ve heard coming out of the nation’s largest newspaper company were stories of layoffs, unpaid furloughs and wage freezes.
So it’s good to know that through all of the pain and misery inflicted on its workers, they were able to grow their profits in the first-quarter by a mere 51%:
Gannett posted net income of $117.2 million, or 49 cents a share, up 51 percent from $77.4 million, or 34 cents a share, in the first quarter 2009.
“All of our business segments delivered substantially higher operating income and operating cash flow in the quarter,” Gannett CEO Craig Dubow said in a statement.
Let’s not forget that around this time last year, a new round of employee furloughs were announced just five days after Gannett disclosed that the board of directors paid $2 million in all-cash 2008 bonuses to CEO Dubow and four other top executives (graphic).
Back in December of 2008, the News Journal laid-off 31 employees, including sports columnist Kevin Noonan, editorial columnist Rita Truschel and writers Al Kemp and Chris Yasiejko. A total of 44 jobs were eliminated, thirteen of which were open at the time of the cuts. Three additional employees volunteered to leave.
Wonder how quickly they’ll be hiring those employees back now that profits are skyrocketing.
Tags: Al Kemp, Craig Dubow, Gannett, Gannett profit, Kevin Noonan, News Journal, Rita Truschel
I guess the recession did not do much to change the habits of companies. High level executives are still absurdly overcompensated.
They’ve found a sure fire the formula for long term success. When they cut operating expenses to zero just think of the profits!!!
UI wrote: “High level executives are still absurdly overcompensated.”
Just because some are does not meant that most are.
Could it be that people are moving away from newspapers for getting their news? If you read their annual report, you can see how they are moving into other methods of news – digital, mobile, etc. They also discuss the environmental effect of newspapers – inks, photographic chemicals, solvents, fuels.
…but of course, it’s more fun to spin how it a rich person’s conspiracy.
Why do you think they call it business?
It’s also seems Mr. Tornoe is misleading us with his statistics. Gannett’s earnings were dismal in early 2009, so a 51% increase sounds great for his story that came from their press release, but doesn’t show the whole picture…51% increase over a dismal number isn’t as huge as he (and Gannett) make it out to be.
But then if newspapers suffer, will Mr. Tornoe’s own cartoonist income for newspapers be at risk? I enjoy his work and hope he isn’t relying on newspapers for his future income.
In spite of this, it’s sad to see anyone without a job and I am sure it was difficult for Mr. Tornoe to see his colleagues laid off. I hope we can get the government refocused on helping businesses grow.
Actually, he isn’t misleading anyone — he posted up the pertinent numbers in his blockquote. But since you won’t read what is there, here it is again:
The dismal numbers were dismal in terms of delivering value to stockholders only. Stockholders and executives at Gannett do very well indeed. The people who get hit are those putting out their papers and their readers who are hugely underserved.
But as Joanne notes, it is their business and they are entitled to kill it.
In the first 3 quarters of 2007, Gannett reported that the News Journal had a profit margin of 25.08% on $54.7 million in sales.
That equates to a roughly $13.7 million dollar PROFIT in the first three quarters of 2007. In the fourth quarter, they laid-off 31 employees. They have also forced all of their employees to take unpaid furloughs for the past 2 years.
The Green-Bay Press Gazette had a 42.5% profit margin in the same time period, and they laid-off 22 workers.
And these numbers don’t include circulation revenue, which I’ve read accounts for around 20% of most newspaper’s revenue
Here’s the filing: http://tinyurl.com/y7cg6e7
My point is that despite the news narrative, individual newspapers, amid the worst advertising decline in their industry’s history and the largest recession in 70 years, are STILL cash cows.
The Press of Atlantic City, The Tulsa World, The Bergen Record. All are large family-owned newspapers in depressed metro areas, and all are doing fine, with little to no layoffs.
The corporate ownership of news has done a fine job of squeezing the profits from their individual properties to make their stockholders and executives a lot of money, at the cost of the workers who put together the newspapers and the end product itself.
And in most communities, they have a monopoly on local news (Delaware is an example of this) so they feel emboldened to continue to degrade their product for short-term profits.
The News Journal is thin and neutered. Local advertisers have abandoned it. The content is drivel. A dwindling core of readers retain it to see who died or got bribed yesterday. The Web site is below 1997 gauge.
I am hoping for the catastrophe to be so thorough that Gannett must sell to a local or regional syndicate, like the one that is reviving The Inquirer.
“The content is drivel.” Uderstandably, anything controversial might offend the advertizers. It’s a two edged sort. You cant have both.
Very sad, but true
Gannett will not sell the News Journal. They have a stranglehold on the local advertisers. This is not unusual; it is the case almost everywhere in the country.
When newspaper companies tell you profits are low or business is dismal, that means their profit margin is somewhere below 20%. Newspapers usually have profit margins closer to the 25% TNJ reported in 2007.
Knight Ridder destroyed several of its newspapers, including the Philadelphia Inquirer and the Akron Beacon Journal, a few years ago because profits weren’t high enough. Not because they were losing money, because they weren’t, but because they were not making enough. The Inky is now in bankruptcy (but should survive in some form), and the Beacon Journal is not what it used to be. Same with many other former KR papers.
So you and I get crud newspapers and web sites and are better served much of the time getting our news from blogs, but at least Mr. Dubow can afford to take his family on vacation this year.
The News Journal are not printing stories that need daylight. Do any of you know what is going on in the AG’s office? Do you know how many crimes are going on without a mention in the Stooge Journal. How many people are being railroaded? I know of 8 cases right now that should be in the paper that most people would be absolutley outraged about it. They can fool some of the people, but not all the people all of the time.
There is a reason why Markell and the democratic legislature won’t do something about prison reform, and the injustices going on with the AG’s offices, Judges and attorneys who are their cronies. The prison industrial complex in Delaware is not decreasing as in other states, its increasing. Why? Because its big business. Because filling up the jails and prisons makes more jobs from the guards, probabtion and parole, case managers, lawyers, judges the courts etc. Big, Big business! Did you know that Delaware incarcerates more people per capita than any nation of similiar populations. What the hell is going on here.
JK: That argument would hold more water if Delaware prison guards were not paid some of the lowest wages in the nation for that job, and if the state had worked its way back to employing as many guards as the budget allows for. Neither is the case.
Wild, scattershot allegations only hurt your case.
You missed the point. Its not just about prison guards whose salaries are low, they are the lower paid on the prison totem pole. I am talking about the AG using the Legislature to its benefit, tricking them if you will to charge someone with a “crime” and then using other charges called “piling on” to take a sentence that could be 5 years and ends up 25yrs to life. We have Judges and attornies in this state so embedded with each other there is a pretend “trial” that doesnt come close to be considered JUSTICE. Its just us. Don’t worry Geezer we wont be counting on the Stooge Journal or any media in this state to do their job, which is why our plan is to bring in outsiders to have no party ass to kiss.
Oh, I see the point, all right. No problem could possibly be an isolated incident when it could instead be part of a massive fraud against the people.
Meanwhile, if you want to rally people to your cause, how about a detailed, written account of the story instead of a bunch of wild-eyed accusations?
“…which is why our plan is to bring in outsiders to have no party ass to kiss.”
Huh? Are you talking about starting a new media operation here?
That’s actually exactly what NJ needs — competition. They essentially have a news monopoly in the state, so they really have no incentive to do any better. What, are they going to get scooped by the other statewide paper? Unfortunately, the print media is dying, so it’s unlikely anyone would start one up here now. Maybe we do need some sort of alternate web-based local news outlet.
No, she’s not talking about competition for TNJ. She hasn’t even responded with a coherent paragraph or two about what she’s railing against.