25/06/2009 - 10:06

WAN staff cull bigger than expected

25/06/2009 - 10:06

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West Australian Newspapers Holdings (WAN) expects to take a near $14 million hit after a higher than expected number of voluntary redundancies at its newspapers.

WAN staff cull bigger than expected

West Australian Newspapers Holdings (WAN) expects to take a near $14 million hit after a higher than expected number of voluntary redundancies at its newspapers.

Earlier this month, the group announced an organisational restructure that involved a 5 per cent across the board staff reduction through voluntary redundancies.

WAN says full time equivalent staff numbers have been slashed by 8.6 per cent across its group.

The Perth-based publisher and radio station operator wants to cut costs amid falling advertising revenue and flat circulation, issues highlighted when the new, Kerry Stokes-led board took up the reins in December, pledging to invest in WAN's editorial resources.

"Due to the level of voluntary redundancies received, the group has achieved an 8.6 per cent reduction in FTE (full time equivalent) staffing levels," WAN said in a statement.

WAN will incur a $13.9 million pre-tax one-off charge due to the restructure that will deliver annual savings of about $9 million.

WA Business News believes the redundancy package is four weeks pay for each year of work for up to 10 years and then three weeks pay for every year after that.

WAN says the charge will not impact its 2008/09 net profit guidance of $93-$98 million. The publisher posted a net profit of $109.9 million in 2007/08.

Media, Entertainment and Arts Alliance (MEAA) WA secretary Michael Sinclair-Jones said the redundancies were regrettable "but it's also understandable because times are tough".

WAN journalists would learn on Thursday if their applications for voluntary redundancies were accepted, he said.

WAN also reaffirmed its net profit guidance of between $93 million and $98 million.

Shares in WAN dropped five cents to $$4.39 at 11:44 AEST.

In further signs the advertising downturn is hammering the media sector, The Australian newspaper is also axing staff, with eight photographers being retrenched nationwide this week, the media union said.

The union added the national broadsheet will rely more heavily on images provided by News Ltd's metropolitan dailies such as The Daily Telegraph and the Courier Mail.

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