Wednesday, October 20, 2010

Newsquest | In government cuts, other shoe drops

Responding to questions from Wall Street analysts about the financial health of Gannett's large U.K. newspaper subsidiary, Chief Operating Officer Gracia Martore said Friday:

"Clearly the progress at Newsquest stalled a bit in the third quarter. If you follow any of the economic and political backdrop in the U.K., you'd note that it's more difficult in the U.K., I believe, than here in the states, as they have had a lot of conversations and the current . . . government leadership there has indicated that on Oct. 20 they're going to be announcing final significant spending cuts across the country."

Sounding annoyed, Martore also tamped down renewed speculation that GCI might sell Newsquest.

Today, Britain's Treasury chief George Osborne said the country's government will make the largest cuts to public spending since World War II -- slashing benefits and public sector jobs in a five-year austerity plan.

By the numbers
Newsquest's advertising revenue fell 7.1% in the third quarter from a year ago vs. a 3.2% drop in the U.S. newspaper division.

It employs one in seven of the company's 35,000 global employees -- a total of 5,100 -- at 17 dailies and hundreds of weekly titles. GCI cut 23% of the division's jobs last year, more than any other operating unit, according to regulatory filings. GCI bought the company in the summer of 1999 for about $1.5 billion.

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