B2B publisher Metropolis has furloughed staff and cut working hours during the Covid-19 lockdown, but its chief executive has said the group could be one of the “winners” of this “terrible crisis”.
The media and events business has also postponed almost 100 events until autumn and winter this year in the hope that restrictions on movement to slow the spread of the virus will have been lifted.
The group announced yesterday that it had secured a £12m funding package from Lloyds Bank, which would give it the “firepower” to drive growth by acquiring new businesses as opportunities emerge.
It has already made a number of acquisitions in recent years, buying Emap from Ascential in 2017 and acquiring Centaur Media’s financial services division, including Money Marketing, last year.
Metropolis owns 40 B2B brands and three consumer-focused titles. Its events business runs 130 face-to-face events, such as the World Architecture Festival, Quality Food Awards and RESI Convention.
But not everyone in the group is happy with chief executive Robert Marr’s focus on expansion at a difficult time for staff.
‘Obscene for them to be prioritising expansion’
A well-placed insider told Press Gazette Marr’s comments were “insensitive,” adding: “Hearing about the £12m loan to fund further acquisitions is truly galling.
“There is a feeling that they should put more attention into looking after what they have got rather than buying more.”
The insider said some staff were questioning why they are “prioritising expansion when dedicated staff are having to take pay cuts, they’re furloughing others and they’ll potentially have to make redundancies”.
Under plans to shore up the business in the short-term, Metropolis is placing some staff on furlough, under the Government’s coronavirus job retention scheme, for two to three months. This means they would receive 80 per cent of salaries of up to £30,000 a year.
All employees who continue to work will face a reduction in their working hours of 20 per cent, including Marr and senior managers, corresponding with a pay cut of the same proportion.
We will be one of the ‘winners’, says chief exec
In an email to staff last week, Marr said: “It was felt that a sacrifice by all of us is preferable to permanently laying-off many of our colleagues.”
He said the decision had been taken as the group faced “significant falls in revenue now and in the coming months” owing to the pandemic.
“We have strong finances in place,” he said. “In the medium and longer term we will be one of the ‘winners’ (if there can be such a thing) from this terrible crisis we find ourselves in, and certainly in a position to carry on growing.
“But businesses can be super-strong in the medium and longer term – in times like these it’s the short term that matters.”
He went on: “I cannot emphasise enough how difficult it has been coming to this decision. It is not one that has been taken lightly, but it does look like the best, and fairest, option to save jobs and secure our business in these severely turbulent times.”
Marr said the refinancing deal with Lloyds Bank had helped it to pay down its debt and left it in a stronger financial position.
The group’s Smartsave service, an online platform that offers a 20 per cent discount on attractions and restaurants, has been discontinued – impacted by people following advice stay at home to avoid spreading the virus.
But it has seen success with some of its titles, such as subscriber growth for some of its consumer brands, and a rise in website traffic to B2B brands Local Government Chronicle, Nursing Times and Mortgage Strategy.
“Our editors have proven how much at the centre of the communities we serve they are, with key information for people facing unprecedented disruption, supportive messaging, and in some areas free access for people who register in need of information,” said Marr.