[The band plays on: Shares have plunged since Dubow became CEO]
2005
May 25: Waking briefly from a deep slumber, the board of directors discovers the Internets, and concludes that Gannett is going to hell in a hand basket. Reportedly turned down by its first two outside candidates, the board settles on No. 3: Dubow (left), head of the TV division. Gannett stock closes: $75.31 a share.May 26: The New York-based Gawker media blog headlines Dubow's appointment in six words: "Gannett newspapers to get somehow dumber."
2006
Nov. 2: Dubow reveals a major part of his strategic plan to save the company: Reorganize GCI's newspaper newsrooms around the newly created Information Center model. "This looks an awful lot like rearranging the deck chairs on the Titanic,'' writes a certain blogger, who's privately tracking Gannett. Stock closes: $58.25.
Dec. 29: In one of the first labor-management skirmishes over the Information Center idea, top executives at The Indianapolis Star (left) back down over demands that newsroom employees write advertorials.2007
March 16: Shares tumble more than 4%, to $55.76, as GCI warns profits will sink. A Morgan Stanley stock analyst says: "Revenues look to be far from reaching some sort of a trough, and until we see some indication of stabilization, we would steer clear from owning the shares."
July 24: The board approves a 29% hike in the quarterly dividend, the single-biggest increase since 1995. Summering in the Hamptons, Wall Street is unimpressed. Meanwhile, the bubbling U.S. mortgage crisis grows worse and -- unknown to most employees -- begins to emerge as the biggest threat to Gannett's future.
Aug. 10: Dubow denies a Wall Street Journal report that says top management is preparing GCI for a sale. Stock closes: $47.37.
Sept. 11: In an alarming memo, Dubow warns that progress is coming too slowly, and hints at a big downsizing: "This is the hard part. This is where transformation gets really difficult. I want to begin talking with you more about this process and what it means. I can't take away all the pain and doubt, but I can help lead you through it." Also, Gannett Blog emerges from stealth mode, appearing in public for the first time.
Oct. 24: Former NBC News president Neal Shapiro named to the board of directors.
Nov. 8: Private investment company Brandes Investment Partners doubles its GCI ownership, for the first time claiming an 11% stake. Gannett Blog traffic surges. Stock closes: $40.44.
Dec. 7: In a dramatic downsizing, USA Today buys out 43 newsroom employees, nearly 9% of all -- losing some of the No. 1 circulation newspaper's high-profile staffers. (Those outmoded digital dinosaurs included a guy with an idea for blog. Oops!)
2008
Jan. 10: One of the company's most powerful executives, newspaper division chief Sue Clark-Johnson, announces plans to retire; she's later replaced by Phoenix GCI executive Bob Dickey (left). The next day, former USA Today reporter and editor Jim Hopkins reveals he has been the anonymous editor of the nascent Gannett Blog.Feb. 15: The Poopgate scandal grabs headlines, as Courier-Post employees in Cherry Hill, N.J., threaten a U.S. Labor Department complaint if they don't get paid for overtime they have worked.
Feb. 28: The 2007 Annual Report reveals that GCI's workforce plunged 7% in the previous year, to 46,100. Looking ahead to 2008, Dubow promises: "I assure you, you will see progress." Stock closes: $30.23.
March 13: Gannett discloses that Dubow was paid $7.5 million in 2007, including a $1.75 million bonus. Employees are outraged: "Gannett stock plummeted almost $50 a share inside of a year and he gets a $1.75 million bonus? And reporters and editors are making due with less staff, less resources -- I'm beyond shocked,'' one says. Stock closes: $29.97.
March 26: Public documents reveal the company's charitable arm, the Gannett Foundation, has quietly allowed Dubow and other top executives to steer nearly $424,000 to their pet charities -- far from communities where the company does business.May 29: Squeezing employees more, Gannett lays off 55 workers at the Asbury Park Press and three other N.J. newspapers.
June 9: The financial picture worsens: GCI writes off nearly $3 billion of its assets.
June 11: Gannett freezes its retirement plan. Furious employees heap blame on Dubow: "Kiss my ass," says one worker. Stock closes: $25.99.
June 27: The Friday Afternoon Massacre reorders the troubled newspaper division, putting publisher's jobs into play at Indianapolis and Louisville.
July 16: Gannett discloses that second-quarter earnings plunged 36% from a year ago. Dubow says the near-term outlook is grim. Investors panic: Shares trade as low as $14.70. Stock closes: $16.57.July 31: Monthly traffic surges on Gannett Blog. The number of unique visitors climbs 21%, to about 17,500. Page views soar 41%, to about 144,000.
Aug. 13: Management grows more desperate, disclosing plans to lay off 600 employees and eliminate another 400 jobs in the troubled newspaper division. Shares briefly surge, but soon begin falling again.
Aug. 18: Gannett starts issuing pink slips. Enraged employees complain the layoffs are taking too long: "The way that management carried this out felt very much like a hit and run."Aug. 22: GCI says July revenue dived 12.3% from a year ago, as classified ad losses accelerate. Stock closes: $17.67.
Sept. 9: In a major reorganization of its troubled newspaper division, Gannett discloses it has laid off about 100 directors -- heads of human resources, production, advertising and other high-profile jobs.
Oct. 1: Gannett says Standard & Poor's has put the company's long and short term credit ratings on credit watch, with "negative implications." Dubow tries to calm investors: “Our underlying fundamentals remain strong and we continue to be a solid investment grade company."
Oct. 24: GCI says third-quarter earnings plunged 32% on a worsening decline in newspaper advertising sales, spurring more job cuts by year's end -- and encouraging the once-unthinkable: slashing the company's unusually generous dividend.
Oct. 28: Reeling from a second consecutive quarter of big revenue losses, Gannett announces plans to lay off 10% of its newspaper employees -- up to 3,000 workers -- by early December. Stock closes: $10.22.
Nov. 28: Internal Gannett documents show every company newspaper but Detroit's was profitable as of the third quarter of 2007. Highest profit margin: the Green Bay Press-Gazette, at nearly 43%.Dec. 3: Gannett has launched newspaper division layoff. Within days, employees have counted nearly 2,000 jobs cut. Stock closes: $8.87.
2009
June 15: Dubow discloses plans to take a medical leave of absence after back surgery; CFO Gracia Martore assumes chief executive's job. Stock closes: $4.10 (Closing price the day Dubow named CEO: $75.31)
Please post your replies in the comments section, below. To e-mail confidentially, write gannettblog[at]gmail[dot-com]; see Tipsters Anonymous Policy in the green sidebar, upper right.
Let's see...CRAIG DUBOW took over in July-2005: GANNETT was $72.00 Per Share with a MARKET VALUE of $16,416,000,000.00...Aug-2008: GANNET is at $17.70 Per Share with a MARKET VALUE $4,035,600,000.00....hhmmm a LOSS of $12,380,400,000.00. We - the SHAREHOLDERS Paid Dubow roughly $21,000,000.00 + perks for this Astounding Demonstration of Business Acumen.
ReplyDeleteI have to tell you, if I managed my Family's Wealth this well they (no matter how much they love me) would dump me face down into North Carolina's Great Dismal Swap....LOL.
Jim, thank you for putting together such an excellent timeline. The pro-Gannett whiners can't argue that it omits anything. The fact is there hasn't been anything positive to report about this company for years. Have you considered putting this in the sidebar as a permanent fixture?
ReplyDeleteI second the permanent sidebar idea.
ReplyDeleteAre we giving Dubow too much credit here though? It's not as if he alone wrecked the company. It took an entire ballet of dysfunction and mismanagement for Gannett to arrive where it is today. It took newsroom after newsroom of yes-men and yes-women editors, and even reporters who were too scared to unionize and fight against so many of these awful mandates.
Gannett is not alone. There is not a newspaper company on the stock market who does not have the same pink slips, revenue declines, and stock dives.
ReplyDeleteIt is not just newspapers. Magazines, are having a hard time too.
ReplyDelete11:21 am - I have stated the same thing in other posts. At one time Gannett was looked at as THE leader in the industry. Where's the innovation now? Gannett has always been good at cutting expenses and saving money. Where's the revenue transformation? Or is Dubow simply hoping the economy will turn around?
ReplyDeletewho is mitchem?
ReplyDelete@11:21 am and @12:07 pm: Good idea! I've added a link called The Dubow Show, about midway down the blue sidebar.
ReplyDeleteDubow is clueless. He doesn't have ANY idea how to run a newspaper. I don't think he understands how the operation works. When will he admit he's inadequate and cry for help? Hopefully it's before this paper is totally run into the ground. I doubt it though.
ReplyDeleteIsn't Mitchem a mens' deoderant?
ReplyDeleteNever let them see you sweat!
I thought you were talking about Robert Mitchem -great actor!
ReplyDeleteFYI - Gannett Corporate Sept 9, 2008, just released that it will layoff another 100 upper managers today and looking to find another several hundred middle managers by end of the year or 1st quarter 2009. I was one of the 100Directors let go. They are planning on continue the plan "Cutting to Profit Plan" which is Bobin' Dickey's best management skill.
ReplyDelete2:05 -- You're right that Gannett is not alone in its financial struggles. It is, however, alone in producing such a high percentage of newspapers that are absolute crap.
ReplyDeleteSome of the country's better papers were better staffed before the economic downturn, meaning they were able to make some cuts without becoming the dismal shells that most Gannett rags now are. Are they as good as they once were? No. Are they better than Gannett papers. In most cases, yes.
In other words, chalking Gannett's woes up to the economy is too simplistic. Just like GM, the company makes a lousy product. Unlike GM it didn't face any real competition for years and thus made ridiculous profits on an inferior product.
Now that the competition has surfaced, all Gannett knows how to do is cut some more.