Guardian newspaper publisher tells staff to expect redundancies as it seeks to break even

 
William Turvill
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Guardian Media Group publishes the Guardian and Observer newspapers (Source: Getty)

The publisher of the Guardian has this afternoon told staff to expect more redundancies in the coming year as it seeks to break even.

Guardian Media Group chief executive David Pemsel and Guardian editor Kath Viner informed staff of the news in an email to “update on the progress of our three-year transformation plan” set out last year.

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“Through everyone’s hard work, we have successfully met our year one financial objectives, reducing our losses just ahead of target and reducing our cash outgoings,” they said.

“However, as we’ve said in the quarterly updates throughout the year, our operating costs remain too high, trading conditions remain tough, and further changes and cost savings will be necessary if we are to meet our target of breaking even at an operating level by 2018/19.”

They added: “We will therefore continue to identify cost savings and efficiencies in year two of our plan.

“Over the course of the next year we anticipate this will lead to some redundancies in the UK and any such proposals will be discussed within the relevant departments. We will also close vacant roles across the business, and we will continue to closely manage all recruitment.”

Staff have not been provided with any concrete figures. City A.M. understands all vacant roles will be closed as part of the plans.

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Here is the letter in full:

Dear colleagues,

With the 16/17 financial year coming to a close, we wanted to provide an update on the progress of our three-year transformation plan to build a deeper set of relationships with our audience, develop and grow our membership offering, restructure our advertising business, and to reduce our cost base.

Our three-year plan is a response to seismic changes in our industry, not least the shift of new and existing print and digital advertising revenues towards Google and Facebook. These structural trends are impacting all media businesses, not just the Guardian, and without continued action now the Guardian’s long-term future remains uncertain.

It’s been a demanding year and we’ve made progress. We have signed up over 200,000 members and have received a further 160,000 one-off contributions; we have increased the yield of our programmatic inventory; we are developing our data strategy and infrastructure to support our relationship strategy; and we have lowered headcount across the business and managed our costs tightly. Through clear OKRs (objectives and key results), we are working more collaboratively across the business better than ever before. We have delivered all this against the backdrop of an extraordinary news agenda, with our newsrooms in the UK, US and Australia producing remarkable journalism. As a result, newsstand revenues are higher than our budget target, we are seeing a sustained increase in traffic, and our audience has never been more engaged.

Through everyone’s hard work, we have successfully met our year one financial objectives, reducing our losses just ahead of target and reducing our cash outgoings. However, as we’ve said in the quarterly updates throughout the year, our operating costs remain too high, trading conditions remain tough, and further changes and cost savings will be necessary if we are to meet our target of breaking even at an operating level by 2018/19.

We will therefore continue to identify cost savings and efficiencies in year two of our plan. Over the course of the next year we anticipate this will lead to some redundancies in the UK and any such proposals will be discussed within the relevant departments. We will also close vacant roles across the business, and we will continue to closely manage all recruitment.

The US has not been immune to these advertising shifts and we are announcing measures that will allow us to stay committed to that market. Today, Evelyn Webster, our interim CEO, and editor Lee Glendinning will present the results of their comprehensive strategic review to US staff which will include some job losses. These are never easy decisions, but they are necessary to ensure a sustainable foundation from which to grow and serve our readers with our journalism. Evelyn has agreed to stay with us until the end of 2017 to deliver these changes.

We continue to investigate all other ways to make the UK business more efficient, and we are confident that our three year plan is on track and will enable us to continue to invest in world-class journalism for the long-term.

The next quarterly strategic and financial update is on Thursday 27 April - those of you in London, please come along (there is an invitation in your calendars). The session will be filmed for everyone else. We will also make ourselves available to discuss the plans for year two in more detail and answer any questions you may have.

Thank you for your ongoing commitment and professionalism.

David and Kath

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