Profit slump at AZ Medien: drastic cost-cutting measures announced
The AZ Group's profit fell by 89 percent to CHF 1.2 million in the 2008 financial year. Publisher Peter Wanner announced "drastic cost-cutting measures" and a reduction in staff. He also wants to present his successor as CEO before the summer vacation.
AZ Medien AG suffered a slump in profits for the second year in a row in 2008. Profit plummeted by 89 percent to 1.2 million Swiss francs. The media company intends to refrain from paying a dividend. The financial year was "unsatisfactory", said publisher Peter Wanner in an interview with AZ on Wednesday. The reasons for this were the economic crisis and the slump in advertising revenue.
Savings in the high single-digit millions
In order to improve the operating result, the company decided on "drastic cost-cutting measures" and a reduction in staff. At the end of 2008, AZ Medien employed 809 people. This corresponds to 643 full-time positions. According to Wanner, a "rigorous savings program" was introduced at Basellandschaftliche Zeitung (bz) and Solothurner Zeitung (SZ). He did not provide any further details. Both titles belong to the Mittelland Zeitung (MZ) group. The AZ Group took over 100 percent of the SZ and its head pages with retroactive effect from January 1, 2009.
Wanner expects savings of a "high single-digit million amount". The aim is to achieve a balanced result in the current year, said the publisher. AZ Medien is solidly financed with an equity ratio of 55 percent.
Pressing project costs at Sonntag and A-z.ch
The costs of Sonntag, which was launched in September 2007, and the project costs of the online platform A-z.ch also weighed on the business result, as AZ Medien announced in a press release. In 2007, profits had already fallen by 24.2 percent. The newspaper publishers achieved an operating income of CHF 119.1 million in 2008. This corresponds to 59 percent of the practically constant total operating income of CHF 201.2 million. The operating result fell by 67.4 percent to CHF 2.6 million.
At regional television station Tele M1, the result was below expectations, as was reported. The media company had already expected to receive fee money in 2008. There were delays due to an objection that has since been settled. Radio Argovia, on the other hand, achieved a good result.
Negotiations with Publicitas gain momentum
Publicitas continues to market the advertisements for the AZ Medien Group. In an interview with the Aargauer Zeitung, Peter Wanner said that revenues were significantly below budget last year and that the company had now drawn the necessary conclusions. Talks are being held with Publicitas about possible new forms of cooperation and corresponding proposals are expected. However, the establishment of an independent marketing organization is also being examined. "We will decide by the end of June at the latest whether we will move in the direction of independent management."
Wanner's successor as CEO should be determined by the summer vacation
With regard to his successor as CEO, Wanner said that he would present four candidates to the search committee, which he had selected together with his headhunter. They would come from the media sector, but also from other industries. "My aim is to be able to present the new CEO before the summer vacation," said Wanner. It is not yet clear whether he will then become Chairman of the Board of Directors. The current Chairman, Jürg Schärer, will certainly remain in office until the next Annual General Meeting in June 2010.
However, Wanner's 26-year-old son Michael is to be newly elected to the Board of Directors. After completing his studies at the HSG in St. Gallen, Michael Wanner is currently completing an apprenticeship at the German media group Gruner+Jahr in Hamburg.
Savings in the high single-digit millions
In order to improve the operating result, the company decided on "drastic cost-cutting measures" and a reduction in staff. At the end of 2008, AZ Medien employed 809 people. This corresponds to 643 full-time positions. According to Wanner, a "rigorous savings program" was introduced at Basellandschaftliche Zeitung (bz) and Solothurner Zeitung (SZ). He did not provide any further details. Both titles belong to the Mittelland Zeitung (MZ) group. The AZ Group took over 100 percent of the SZ and its head pages with retroactive effect from January 1, 2009.
Wanner expects savings of a "high single-digit million amount". The aim is to achieve a balanced result in the current year, said the publisher. AZ Medien is solidly financed with an equity ratio of 55 percent.
Pressing project costs at Sonntag and A-z.ch
The costs of Sonntag, which was launched in September 2007, and the project costs of the online platform A-z.ch also weighed on the business result, as AZ Medien announced in a press release. In 2007, profits had already fallen by 24.2 percent. The newspaper publishers achieved an operating income of CHF 119.1 million in 2008. This corresponds to 59 percent of the practically constant total operating income of CHF 201.2 million. The operating result fell by 67.4 percent to CHF 2.6 million.
At regional television station Tele M1, the result was below expectations, as was reported. The media company had already expected to receive fee money in 2008. There were delays due to an objection that has since been settled. Radio Argovia, on the other hand, achieved a good result.
Negotiations with Publicitas gain momentum
Publicitas continues to market the advertisements for the AZ Medien Group. In an interview with the Aargauer Zeitung, Peter Wanner said that revenues were significantly below budget last year and that the company had now drawn the necessary conclusions. Talks are being held with Publicitas about possible new forms of cooperation and corresponding proposals are expected. However, the establishment of an independent marketing organization is also being examined. "We will decide by the end of June at the latest whether we will move in the direction of independent management."
Wanner's successor as CEO should be determined by the summer vacation
With regard to his successor as CEO, Wanner said that he would present four candidates to the search committee, which he had selected together with his headhunter. They would come from the media sector, but also from other industries. "My aim is to be able to present the new CEO before the summer vacation," said Wanner. It is not yet clear whether he will then become Chairman of the Board of Directors. The current Chairman, Jürg Schärer, will certainly remain in office until the next Annual General Meeting in June 2010.
However, Wanner's 26-year-old son Michael is to be newly elected to the Board of Directors. After completing his studies at the HSG in St. Gallen, Michael Wanner is currently completing an apprenticeship at the German media group Gruner+Jahr in Hamburg.
