Sunday, February 1, 2009

Why Gary Pruitt will have to finesse the timing any layoff announcements

If the much-rumored McClatchy layoffs are about to be announced, the suits at the corporate office who need to schedule the announcement are staring at a date circled in red on their wall calendars -- Thursday, February 5.

February 5 is the day Gary Pruitt and Pat Talamantes and other McClatchy bigwigs get on the phone for the 4th quarter earnings call, to be quizzed by newspaper analysts about developments at the company.

At the last conference call, analysts included Alexia Quadrani from J.P. Morgan, Craig Huber from Barclays, Peter Applet from Goldman Sachs, Catriona Fallon from Citigroup, and others.

Of course, with the newspaper industry in steep decline, investors are losing interest in newspaper stocks and as a result there are fewer analysts devoted to newspaper companies.

So Pruitt and his team have to be evaluating whether they want company-wide layoffs to be a topic at the conference call. If they conclude layoffs will demonstrate a commitment to fiscal discipline and will enhance the long term health of the company, expect the layoffs to be announced Monday or Tuesday. And if they conclude layoffs will detract from another message they want analysts to hear, expect the layoff announcement to come after Thursday.

And remember, McClatchy has a history of announcing layoffs on Monday. It was June 16, sometimes called "Bloody Monday," when McClatchy announced it was cutting 1,400 jobs. (But the next round of McClatchy layoffs in late summer were rolled out paper-by-paper over a period of weeks, instead of being announced on one day, so there's that too.)

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11 comments:

Anonymous said...

You have to wonder why news organizations whose job is to report the news, leaves their employees dangling in the wind for sooooooo long. Pru isn’t going to make a decision to cut or furlough employees later this week. He knows now, and has known for some long time. He is a skunk.

Anonymous said...

Discussing the furlough vs. layoff plans, one newspaper editor said the first furlough day would be a Monday, and the entire paper would close down for the day. He remarked it would be like a three-day weekend.

Anonymous said...

My quess papers will go to 5 day and do layoffs.

Anonymous said...

Gary Pruitt has made some terrible business decisions. I would feel a tinny tiny bit sorry for him, except part of his job was to stay current with print trends. The bad economy is accelerating the demise of the print media, but certainly is not the only culprit. I have not subscribed to a newspaper or magazine for a couple of years. I just don’t want to bother with them.

Anonymous said...

Not that I feel sorry for the likes of a Gary Pru, but this 4Q meeting can’t be easy for any person of great ego, and it takes a great ego and drive, to get where he is today. I think he is suffering for himself, the company, and the employees that have been swept into this mess. It is an ugly situation all the way around, but ‘the buck stops here’ and all that jazz.

Anonymous said...

Gary Pruitt has to go. How can someone ruin a good company and stay at the helm?

Anonymous said...

I am thinking the 4th quarter earnings call, could be brief, unless the excuses kick in after the red ink sentence.

Anonymous said...

McClatchy buys ink by the barrel, red ink that is.

Anonymous said...

About Gary Pruitt needing finesse, he needs a lot more than finesse, he need a brass pair, his golden ones were made of fool’s gold

Anonymous said...

You know, Pruitt serves as a convenient scapegoat, but really the problem lies with all of you rank and file. I've never been a Mcclatchy employee but did work for 2.5 years as a vendor/consultant. Whenever I brought a suggestion or idea or improvements the kicking and digging in were unbelievable. The final straw came when I was asked to take legal responsibility for mistakes Mcclatchy might make-mistakes I was hired/trying to prevent. Good luck to all of you in the next two weeks. You'll need it.

Anonymous said...

You know, Pruitt serves as a convenient scapegoat, but really the problem lies with all of you rank and file
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Right. Uh Huh. Rank and file threw the company several billion into debt knowing full well that the industry as a whole was in a fatal tail spin.

The rank and file lied continuously about the stock valuations, prospects for recovery, and job stability, all the while selling off their holdings and leaving stockholders stuck holding the bag.

Man, are you stupid?

Tell me another one.