Seven to slash staff in bid to save $25m
SEVEN West Media plans to make $25 million of job cuts to counter falling ad revenues and a highly competitive TV market.
Chief executive Tim Worner says the cuts, to be made next year, will help the Seven Network owner almost double the $30 million in savings it had planned for this financial year.
It had planned those cuts to offset the higher costs of its pivotal AFL broadcast rights.
In an email sent to Seven West staff yesterday, Mr Worner said each part of the company would be reviewed with the aim of restructuring and reducing roles in many areas.
“Our industry faces significant competitive headwinds, disruption from global players, increasing content costs and consequently financial pressure on all parts of the company as we transform,” he said. “We need to adjust and align our cost base to recognise the changes in our marketplace.”
Speaking at the company’s annual meeting yesterday, Mr Worner said Seven West would also realise $50 million in savings next financial year, when it would not bear costs related to broadcast rights for one-off sporting events.
Seven has the rights for the Pyeongchang Winter Olympics and Gold Coast Commonwealth Games in 2017-18.
Mr Worner said the company expected its underlying earnings – a tally that strips out one-off items – to be in the range of $220 million to $240 million for the year to next June.
That compares with $261 million last financial year.
Shares in the group tumbled 4c, or 6.1 per cent, in the wake of the revelation, to 61.5c.
Seven West also announced two new board appointments yesterday following Michelle Deaker’s announcement that she would not seek re-election.
Teresa Dyson, who is on the boards of Energy Queensland and Energy Super, and Michael Ziegelaar, a corporate lawyer, will join the nine remaining board members, who include chairman Kerry Stokes and his son Ryan.