Postmedia CEO Paul Godfrey warns of more cost-cutting as revenue continues slide
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TORONTO — After recent rounds of mass layoffs, Postmedia is warning that it still needs to cut costs after revenue plummeted by 13.5 per cent in its latest quarter.
The company, one of Canada's largest in the news media industry, has been unable to shake declines in print advertising and circulation revenue that have taken bite after bite from its bottom line.
"In a climate of continued legacy revenue decline, a focus on cost-saving is crucial to moving our industry forward," Postmedia (TSX:PNC.B) CEO Paul Godfrey said Thursday in a conference call with investors.
"We must continue to work towards a cost structure that reflects the revenue reality that we face."
Last October, Postmedia announced a plan to reduce its salary expenses by 20 per cent and initiated a voluntary buyout program.
Godfrey said earlier this year that plan did not bring about enough savings and the company would cut more jobs.
Recently, Postmedia laid off 54 employees at its B.C. papers, the Vancouver Sun and the Province.
For its second quarter ended Feb. 28, Postmedia said it lost $26.5 million or 28 cents per share, an improvement from losses of $225.1 million or 80 cents per share in the same period a year ago.
This year's second quarter was free of any asset impairments, compared with a $187 million writedown last year.
Postmedia's ledger was also helped by a $21.6 million decline in operating expenses, mainly due to cost-saving measures. But the company's total revenue fell by $28.3 million to $180.8 million, primarily because of falling print advertising.
Digital revenue rose by $2.6 million, or 10.3 per cent, to $28.1 million.
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