Memo: A message from Paul Godfrey
President and CEO of Postmedia addresses “unsettling headlines” regarding the company in memo.
Over the last couple of weeks you’ve probably seen some rather unsettling headlines in print, posted online and shared through social media. Many of these stories have been generated by competitors facing similar revenue challenges and undertaking significant cost cutting initiatives themselves.
While I’m certainly not going to dissect each article and post line-by-line, I thought it might be helpful to share some important points with you.
· We have been quite transparent with all of you, and publicly, that we have undertaken a massive reengineering of our cost structure. We are in the process of identifying $50 million in cost savings over the next two years.
· Since the inception of Postmedia, we have made debt repayments of $267 million. We have met every debt repayment obligation.
· Industry-wide revenue declines have increased pressures on both reducing our cost structure and exploring every possible revenue stream.
· We have recently launched a number of initiatives aimed at new revenue generation. As with anything new, it will take some time to show results that we can report on but kudos go out to the revenue team that has recently launched Content Works, Digital Marketing Services and have accelerated our success in the programmatic area.
· We also continue to roll out our reimagined products most recently in Saskatoon and Regina and update our apps and online offerings on an ongoing basis as we have recently with our tablet and smartphone platforms. And, over the last few months we have seen consistent digital audience growth and our rankings and audiences are at record highs.
· We have also been criticized recently with respect to election endorsements – even from those who made strong and sometimes curious endorsements themselves. As Canada’s largest publisher we are going to take knocks like this as we have in the past and in every election cycle. You may find it interesting, as I did, to discover that traffic to our newspaper websites on election day was up 68% versus the May 2011 election day traffic. We generate strong opinions both for and against issues and stands on all of our platforms. It’s public discourse and it’s what journalism is all about.
· On that same note we were criticized for running certain election ads. All ads were paid for and directed by the parties that ran them. Over the course of the election, all four major parties: Conservatives, Liberals, NDP and Green ran ads across various Postmedia properties. Homepage takeovers on websites, full page ads, and yes, even newspaper wraps. While it certainly caused a lot of buzz, these ads conformed to election guidelines and our advertising guidelines too.
There is no doubt that these are challenging times for our industry and for our company too. The executive team at Postmedia has always been open to employee feedback and we are as transparent as a public company can be with respect to keeping you informed of our important initiatives.
The most important thing is that you and your teams stay aligned to our overall objectives which include engaging our audiences across all platforms, generating revenue from traditional and emerging areas and transforming our cost structure to align with a new revenue model.
This is hard work. To our people across the organization who continue to work hard and adapt in a constantly changing environment you have the sincere thanks and support of your leaders, the executive team and our board of directors.