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SYDNEY: Australia's second largest press group Fairfax Media announced Tuesday it would slash five per cent of its workforce, or 550 jobs, as part of a plan to save A$50 million (US$43 million).
Unions said the redundancies in Australia and New Zealand would affect around 180 journalists in the group that publishes the flagship Sydney Morning Herald and The Age newspapers.
"A wide range of initiatives will result in a head count reduction of approximately 550 employees in Australia and New Zealand, or approximately five percent of the company's full time workforce," Fairfax said in a statement.
The cuts, part of a restructuring after Fairfax last year merged with the Rural Press group and acquired a major broadcasting company, will affect editorial, printing, maintenance, paper and fitting staff.
The measures will deliver around A$50 million in annualised savings, with A$25 million expected to be reflected in 2008/09 annual results.
"Media companies fit for the modern media world need to be lean and agile," chief executive David Kirk said in a statement. "This far-reaching programme will position us well for the next stage of our growth and development."
Fairfax has carried out two previous restructuring waves that have saved it A$52 million, while the merger with Rural Press and the acquisition of Southern Cross Radio produced a further A$53 million in savings, Kirk said.
Fairfax last week announced a 46.8 per cent jump in net profit to A$386.9 million for 2007-08 on the back of a strong performance from its online businesses.
But newspaper circulation is shrinking and the group has warned that more difficult economic conditions have already slowed the advertising market and that tougher times are ahead as the economy slows.
Australia's main media union said about 180 journalists would be shed as part of the job cuts.
"It's one of the most significant job losses in Australia this year," said Media Entertainment and Arts Alliance (MEAA) federal secretary Chris Warren.
"It's obviously going to have a serious impact on the ongoing quality of the company's papers, magazines and websites in Australia and New Zealand," he added.
- AFP/yb
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