Time Inc, the publisher of Sports Illustrated and People magazines, on Wednesday slashed its dividend in an effort to bolster its balance sheet, and also reported a almost 8 percent fall in quarterly revenue. It slashed the quarterly dividend from 4 cents a share to 19 cents, and said it hired an adviser to help with "aggressive cost reengineering for meaningful margin expansion".
On its earnings call Wednesday, Time reported a loss of $28 million, or 29 cents per share in the first quarter, bigger than the loss of $10 million, or 10 cents per share, a year earlier. The company's print advertising revenue fell 21% to $212m in the first quarter ended March 31, while digital advertising sales surged 32% to $119m. On an adjusted basis, the company reported a loss of 18 cents per share, more than the 15 cents expected by analysts on average. Time is also the publisher of Sports Illustrated and Fortune magazines.
The company said it "no longer intends to provide quarterly pacing or an annual revenue outlook", but would provide "insights and key metrics as appropriate".
Circulation revenues fell 13.9 percent to $205 million, weighed down by a 17.6 percent dip in newsstand sales to $56 million and a 13 percent decline in subscriptions to $140 million. It carries $1.2bn in long-term debt, dating back to its spin-off from Time Warner almost three years ago.
Comey told me three times I wasn't under investigation
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For the full year, Time Inc.is predicting its various online media outlets will generate a total of over 8.5 billion digital video views. Time also announced changes to its board of directors, appointing John Fahey - formerly the chairman of the National Geographic Society - as non-executive chairman.
The company appointed John Fahey, now the board's lead independent director, as non-executive chairman.
Dan Rosensweig, president and ceo of online learning platform Chegg Inc. and former chief operating officer at Yahoo, has been nominated to the board. New York-based Time was said to be holding out for more than $20 a share. Despite drawing interest from suitors including Meredith, the publisher of Better Homes and Gardens and Martha Stewart Living, Time Inc's board chose to stick with a strategic plan focused on digital growth, new revenue sources and cost-cutting measures. That could include the sale of some titles.
The owner of Sports Illustrated and People will look to offload "relatively smaller" titles in its portfolio and other "non-core" assets, chief executive Rich Battista said Wednesday on a conference call.
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