Chief executive Sly Bailey’s longawaited strategic review of Trinity Mirror sounds like music to the ears of investors.
Her presentation at the London Stock Exchange spoke of “increasing shareholder value”, cutting costs and boosting profit margins.
- September 21, 2020
- September 15, 2020
- August 25, 2020
But it may be less well received by some of the company’s 12,000 staff, especially the 550 of whom are to lose their jobs. Journalists on Trinity Mirror’s 260 titles will also be interested to note that Bailey has declared herself willing to “tackle the sacred cow of editorial costs”.
However, Bailey says of the job cuts: “Some of them will be from editorial, but that is not the real focus of this cost reduction programme in terms of head count.”
So far heads have rolled higher up the food chain – 18 redundancies have already been announced at the regionals’ head offices in Liverpool and London, halving the number of staff.
These include communications director Robin Fletcher, head of advertising development John Eccleston and regionals division director Leo Coligan.
Further savings are expected to be achieved by centralising departments such as human resources, finance and IT.
THE GIST OF Bailey’s companywide review is that Trinity Mirror has failed to reap the benefits of the merger four years ago between Trinity plc and Mirror Group which made it Britain’s biggest newspaper publisher. To take advantage of the size of the group she has called for more crossover between titles in terms of promotion, ad sales and editorial content.
As expected, Trinity Mirror’s Irish titles have been put on the market. There have already been several expressions of interest for the businesses.
These include the owners of the Irish Examiner, Sunday Business Post and the London-based Irish Post, Thomas Crosbie Holdings, which has signalled it will make a bid for the titles, which include the Belfast News Letter, Northern Ireland’s leading unionist paper with a circulation of 32,000 copies daily.
The Derry Journal and the Donegal Democrat are also up for grabs in a portfolio said to be valued at £30 to £40m.
Trinity Mirror sold the Belfast Telegraph to Independent News and Media three years ago and they may also be in the frame.
As for the nationals, Bailey intends to arrest the sales decline on the Daily Mirror with the help of marketing guru Ellis Watson, formerly of News International and Celador, who has been taken on as general manager.
There will be no return to the more serious news agenda pursued by Morgan last year. Instead, Bailey is to continue her hands-on role and says she wants the paper to contain “seriously good popular journalism” rather than just “serious news”.
However, up to 45 jobs are to be lost at the Daily Mirror – representing a cut in the workforce of roughly 10 per cent. These are on top of the 38 already going because of the closure of M magazine and The Look. M magazine alone is understood to have cost Trinity Mirror £9m a year to run.
The Welsh Mirror is to close and will be replaced on news-stands in Wales with the English version of the paper which will contain a few Welsh change pages.
Older staff on the Daily Mirror have been encouraged to take early retirement where possible, though Bailey has denied the suggestion that it is an ageist policy.
This has led to speculation there may be future investment in “younger and cheaper” staff at a later date.
Trinity Mirror has so far been unable to confirm where the other 550 redundancies will fall. A company spokesman said only that they will cover all areas of the group, nationals and regionals, and all functions.
Bailey has no plans to sell off The People but wants to differentiate it more from the Sunday Mirror. She says there is scope for persuading readers to buy both papers, although she admitted few do so at present.
She intends to end the aggressive competition in Scotland between the Scottish Daily Mirror and the Trinity Mirror-owned Daily Record by creating closer links between management on the two titles.
Bailey has been with the company for just six months and, considering the current slump in advertising, it appears in reasonable financial shape overall.
The half-year results, released along with the strategic review, show pre-tax profit up 10.1 per cent to £79.4m on turnover slightly down, compared with last year, of £551.6m.
Driving this profit growth has been the regionals division, which shows a profit margin of 25.2 per cent on turnover of £264.5m.
She says the company’s local papers need to be “relevant, compelling and sitting at the heart of local communities” but she believes that there needs to be “more aggressive cover price management” – price increases in other words.
Although she admitted that the regionals division has performed well in a difficult market, she says there is still scope for more cutbacks.
“It is possible to do more without ripping the heart out of these businesses,” she says.
Overall Bailey wants to find cost savings of £4m by the end of this year, £20m in 2004 and £25m in 2005. That’s in addition to cuts worth £42m which have previously been announced.
Like a general martialling her troops before battle, last week Bailey called her 50 top managers together for a briefing. She said her message to them was this: “Trinity Mirror is not a place for the fainthearted.”
REACTION: NUJ TALKS OF TREACHERY BUT STAFF APPEAR RESIGNED
The National Union of Journalists has described Bailey’s proposed job cuts as “treacherous”, but her review has been welcomed by stock market analysts.
NUJ deputy general secretary John Fray, left, said: “At a time when profits are increasing, jobs are being cut. Does that mean that as profits get even higher they should sack more and more people? That seems to be the logic but it’s treacherous.
This group has done very well on the hard work of our members who have now have to worry whether they have a job.”
Steve Turner, general secretary of the British Association of Journalists, which represents editorial staff on the Daily Mirror, said: “The latest list of redundancies at the Daily Mirror is shocking news. BAJ is doing its utmost to persuade the company to reduce the number of job losses and make sure remaining staff are not overworked or put under excessived strain.”
Paul Richards, of brokers Numis Securities, said: “Under the new leadership Trinity Mirror is poised to be revitalised. Within six months of her arrival, Sly Bailey has demonstrated her proactiveness, introducing a streamlined management structure, closing the costly Saturday supplement M magazine and disposing of the remaining Northern Ireland titles…the strategy of stabilisation, revitalisation and growth should be applauded by investors.”
Staff have been awaiting Bailey’s review with trepidation for some weeks and don’t appear too fazed by it. There appears to be a feeling in regional newsrooms that editorial budgets have already been cut back as far as they can go and are unlikely to be cut much further.
One national journalist said: “It isn’t anything that we didn’t expect, everyone knew pretty much what she was going to say.
Spending is being cut on things like overseas travel and other expenses and morale is a bit down. But it’s not as bad as we thought it was going to be.”
By Dominic Ponsford