Second Quarter 2009 earnings by Idaho Statesman parent company McClatchy released today show that drastic cost cutting, including two rounds of layoffs, have paid off for investors.
McClatchy took in $42 million in net income in the second quarter, despite ad revenues sinking 30.2 percent over the same period in 2008. Even as McClatchy talks about repositioning itself as a "successful hybrid print and online company," online ad revenue is also falling 2.9 percent for the quarter, mostly due to a lack of job ads.
But stringent measures, including 15 layoffs in September 2008, appear to be propping up the company's bottom line. The latest cost saving measure at the Statesman is a round of weeklong furloughs currently underway. Dan Popkey and Michael Deeds were recently incommunicado and had their salaries docked for a week apiece, according to at least three independent sources who work at the Statesman and asked not to be named. The furloughs are scheduled out into the winter.
and workers were assigned their week in a memo without a chance for input.
UPDATE: Statesman employees were given an option of choosing their furlough weeks. See comments below.
I left Statesman Publisher MiAi Parrish three messages, but she did not return my calls. McClatchy CEO Gary Pruitt stressed in his statement on the earnings report that McClatchy is a company in transition. Average monthly visits at company Web sites was up 30.1 percent for the quarter and Pruitt said that cost cutting measures meant every constituent paper turned some profit. Digital ad revenue now represents 16.5 percent of all ad revenue, up from 11.8 at the same time last year.
"We are among the leaders in our industry in online advertising revenue performance and online advertising as a percentage of total advertising. Those who think of McClatchy as just a newspaper company need to take a fresh look. We are quickly becoming a 24-7 news and advertising company that can deliver in print, online, and to handheld devices," Pruitt stated.
Meanwhile, as morale continues to sink in the Statesman newsroom, another source tells us the paper may be looking to hire a new business reporter. Do they want those resumes in paper or plastic?