Independent News & Media, the media group controlled by Sir Anthony O'Reilly, confirmed today its plans to lay off approximately 600 of its worldwide workforce as part of a restructuring programme aimed at cutting losses.
The plan will see 5 per cent of the current 12,00-strong workforce cut. The company could not confirm how the restructuring plans will affect staff based in Ireland.
According to the company, restructuring will result in an exceptional charge of €53.5 million, which is offset by the substantial capital gains made on disposals during the year, it added.
It said it will be financed on a phased basis from internal resources.
The restructuring is expected to generate cost savings and profit improvements each year building up to €18.4 million by 2005.
Referring to trading, Independent News & Media said it continues to trade in line with market expectations, with strong performances from its Australasian and South African divisions, the anticipated seasonal improvement flowing through in the fourth quarter in Ireland, and strong core circulation gains from the new dual format (broadsheet and compact) "Independent" in the United Kingdom.
The group's total advertising revenues from its globally-diversified operating base continue to trade ahead of 2002.
It said the group has recorded advances in market share, with growth in property, motors and retail more than off-setting a still sluggish recruitment/financial advertising sector.
It added circulation revenues - across its titles - continue to show solid advances on 2002, reflecting the impact of both cover price increases and market share gains.
The launch in September of the compact "Independent" in the United Kingdom has far exceeded expectations and has already delivered a 20 per cent sales increase in the core UK Newstrade sales at full retail price.
Referring to outlook based on fourth quarter trading, advertising levels continue to improve as anticipated and circulation revenues remain firm going into 2004.
The group's substantially lower debt levels and strong working capital management will deliver a reduced interest charge and enhanced cash generation going forward.
Sir Tony said the plan would enable INM to be "the low-cost operator in all of our markets", the Guardianwebsite reported.
He added: "It will allow us to further exploit our global footprint in a truly location-indifferent way, meaningfully reducing costs, while improving our product and distribution capabilities."
AFP