Torstar Corp. reshuffles management, cuts dividend and staff
Posted by Simon Day on February 27, 2009 at 12:50 PM
Canadian newspaper and book publisher Torstar Corp. has announced a management reshuffle, halving of its dividend and more redundancies, in an attempt to accommodate slumping advertising revenue. Current Chief Executive Robert Prichard is to depart and will receive an CA$8 million severance package, the Financial Post reported Friday.
Torstar publishes the Toronto Star, Canada's largest daily, as well as other daily and community newspapers in southern Ontario.
Torstar publishes the Toronto Star, Canada's largest daily, as well as other daily and community newspapers in southern Ontario.
The company described Prichard's May departure as a "planned transition." He will be replaced in the interim by Chief Financial Officer David Holland, according to the Financial Post.
Analysts were surprised by the size of the compensation. At $11 million before taxes, the payout is almost five times Prichard's current salary.
Torstar's stock has dropped nearly 300 percent since Prichard was appointed chief executive in 2001. Share value has declined almost 70 percent in the last 12 months. However, given the economic climate and the state of the publishing industry, how much can be attributed to Prichard is questionable, the Financial Post reported.
"Clearly the state of the newspaper industry supersedes the quality of one executive at one operator," one analyst told the Financial Post.
Torstar recently cut its annual dividend in half from 74 cents to 37 cents, reflecting the drop in advertising revenue. The publisher listed a net loss for the quarter at $211 million, down from a $47 million profit in the final quarter of lat year. A significant factor was the $95.7 million writedown of the company's CTV globemedia investment, the Financial Post reported.
The company plans to make more cuts in its newspaper sector on top of 500 employees laid off last year.
Analysts were surprised by the size of the compensation. At $11 million before taxes, the payout is almost five times Prichard's current salary.
Torstar's stock has dropped nearly 300 percent since Prichard was appointed chief executive in 2001. Share value has declined almost 70 percent in the last 12 months. However, given the economic climate and the state of the publishing industry, how much can be attributed to Prichard is questionable, the Financial Post reported.
"Clearly the state of the newspaper industry supersedes the quality of one executive at one operator," one analyst told the Financial Post.
Torstar recently cut its annual dividend in half from 74 cents to 37 cents, reflecting the drop in advertising revenue. The publisher listed a net loss for the quarter at $211 million, down from a $47 million profit in the final quarter of lat year. A significant factor was the $95.7 million writedown of the company's CTV globemedia investment, the Financial Post reported.
The company plans to make more cuts in its newspaper sector on top of 500 employees laid off last year.
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