The Newspaper Guild already had accepted 6.6% wage cuts in April to try to save some jobs, after nine people accepted buyouts in the spring.
Steve Smith, chairman of the board and CEO of Journal Communications, also imposed a 6% wage cut on executives, managers and others not represented by the union. Like the Guild members, they got 10 “personal days” off per year in return. Said Smith:
As we manage for the long-term success of the company, we must identify constructive ways to continue to reduce costs.
In late April came this announcement:
Citing ‘the challenging economic environment,’ the board of Journal Communications Inc. said Thursday it will suspend the dividend on Class A and Class B shares of its stock. Quarterly dividends on the shares had been cut to 2 cents from 8 cents in February.
“While we regret having to make this difficult decision, we believe this is the prudent choice in order to maintain financial flexibility,’ said Steven J. Smith, chairman of Journal Communications. ‘Given the continued challenging economy and business conditions, we believe that this will allow the company to continue to direct a significant portion of its cash flow to debt reduction.’
Things haven’t gotten any better. In the second quarter of this year, the company lost $4.8-million. It’s hard to find a silver lining — unless, of course, your name is Steve Smith. A March 19 report from the Journal Sentinel business page:
Total compensation increased almost 22% last year for Journal Communications Inc. chairman and chief executive Steven J. Smith, according to a regulatory filing by the company Thursday.
Smith earned no bonus, but his salary rose 3.7% to $798,077. He received stock awards worth $1,672 and option awards valued at $397,003, a proxy statement for the Milwaukee-based media company and publisher of the Journal Sentinel said. The biggest change in compensation was in the value of Smith’s retirement benefits, which grew to $233,110, compared with $74,782 in 2007. He received other compensation last year worth $16,095.
Journal Communications posted a $224.4 million loss in 2008, largely due to $228.7 million in non-cash charges in the fourth quarter as the company wrote down the value of goodwill and some of its television and radio licenses. The company’s newspaper, radio and TV operations also saw declines in revenue because of the recession and the ongoing migration of ads to the Internet. Its stock price fell 72.6% during 2008.