In a Thursday conference call with reporters, Tribune Co. Chairman and CEO Sam Zell indicated that the employee-owned company ? owner of The Chicago Tribune, The Sun, several other dailies and 23 broadcast stations ? likely would soon be cutting editorial content and assessing reporter productivity in order to increase earnings.
“We are actively pursuing a program to right-size our newspapers,” said Chief Operating Officer Randy Michaels, who outlined a series of innovations and efficiencies to increase sales, reduce company costs and lower its $10.6 billion debt.
“We have found out we can take about 500 editorial pages a week out of our newspapers in a 50/50 ad-to-content ratio,” Michaels added, noting that the result would still “be a good value for the consumer.”
Michaels hinted that headquarters would be looking at reporters? output and possibly cutting those not on a par with their peers.
With first-quarter Tribune Co. total publishing advertising revenue down 15 percent year-over-year and an economy teetering on a recession, Zell stressed the need for such drastic change.
Stating that Tribune Co.?s “print declines are on a par with the industry,” Zell noted, however, that the company?s Q1 broadcasting and entertainment revenues were up 3 percent year-over-year and that its sale of Newsday to New York?s CableVision Systems Corporation will net it $650 million in cash.
Zell also announced that Tribune Co. has enlisted a major bank to help it launch an asset-backed commercial paper program that he estimated would bring in another $250 million this year.
The two deals, which Zell believes will be finalized by September, will, he said, “satisfy [Tribune Co.?s] principal amortization requirements through the year 2008.”
In a review of Tribune Co.?s first-quarter financials, Chief Financial Officer Chandler Bigelow noted that consolidated revenues were down 8 percent ? or $95 million ? year-over-year and that publishing total revenue was off 11 percent.
