vIndianz.com (30 Oct, 2009) — Adding an additional blow to what is becoming a more and more gloomy industry, the magazine publisher Time Inc. is anticipated to declare next week that it will slash $100 million in costs and make considerable layoffs.
Time Inc., publisher of magazines include Time, Fortune and People, is synchronizing its declaration with the third-quarter earnings statement of its parent, Time Warner, sources said. The earnings report is planned for Wednesday morning.
The $100 million in cuts is anticipated to come mainly from layoffs, said sources, who asked to be unspecified as they were not allowed to talk about the pronouncement. No magazines appeared is expected to shut, one source said.
At Time Inc., cuts have by now been grave. A year ago, it announced it was sacking about 600 people, or 6 percent of its employees. Ever since 2007, it has close up magazines including Business 2.0, Cottage Living, Southern Accents and Life, which it had revitalized as a newspaper addition. A stricter expense-account policy has been in position for a short time, and some magazines have decreased the heaviness of the paper they use. And last week, Fortune announced that it would no longer be available every other week and would decrease its regularity to 18 issues a year, from 25.
Michael Nathanson, an analyst at Sanford C. Bernstein & Company, said he anticipated third-quarter profits at Time Inc. to go down about 19 percent, to $900 million. The majority of that is because of weaker publicity, Mr. Nathanson said.
From 2004 until the end of this year, Time Inc. is anticipated to have slashed about $800 million in costs, Mr. Nathanson said. In general, he said that he anticipated Time Warner would post earnings of 54 cents a share, up from the 30 cents a share it posted in the third quarter of 2008.
Layoffs and cost-cutting are becoming typical practice in the magazine industry. Forbes announced on Monday that it was dismissing 40 to 60 people from its editorial employees. That followed layoffs of about 100 people in the last year or so. And most Condé Nast magazines are dipping their budgets by about 25 percent, which has incorporated handfuls of layoffs at several magazines. Condé Nast also stopped up four magazines, including Gourmet, this month.
Some Time Inc. staff at People, Time, Sports Illustrated, Money, Fortune and Fortune Small Business is sheltered by union contracts, which direct separation in case of layoffs. The agreements mainly pertain to reporters; most editors are considered management, and are not covered, said Bob Townsend, local spokesperson for the Newspaper Guild, Communications Workers of America.
Those guild employees are eligible for severance packages in a layoff, of two weeks’ pay for every year of employment, with a cap of 52 weeks’ pay. Longtime employees receive a bonus, with 20-year veterans getting an additional eight weeks’ pay, and 25-year employees an additional 10 weeks, he said.
Further Reading- Ohio job cuts eased in March – Bizjournals.com
- Profits fall at NY Times Co. – Boston Globe
- Economy brightens as consumers spend and layoffs slow – Philadelphia Inquirer
- Planned layoffs: Lowest January on record – CNNMoney
- ICBC to pay $140 million for 80 percent of US retail bank – Reuters
- Jewel asks employees to take time off without pay – Chicago Tribune
- Yahoo First-Quarter Sales Top Estimates as Ad Demand Climbs – BusinessWeek
- Fewer people sought unemployment aid last week – The Salinas Californian
- Jewel-Osco parent settles discrimination lawsuit – Chicago Tribune
- Hard Liquor Maker Brown-Forman Exceeds Views, Smithfield Short On Sales – Forbes
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