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Prisa ask staff to take pay cuts

Thu, 2009-06-18 17:11 — Valerie Arnould

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The Spanish media group Prisa (publisher of El País) will ask its staff earning more than 100,000 euros to take pay cuts of 8 percent said group CEO Juan Luis Cebrian during the general assembly of shareholders on 18 June. He added that the group would enter negotiations with the unions on the topic of similar pay cuts in exchange for a reduction in working hours.

The CEO announced to the shareholders that the group was suspending payment of dividends until 2011. This measure is taken as a direct result of an agreement with creditors to extend a 2 billion euro bridge loan until next year, with one of the conditions being that dividend payment would not be made until debt was no more than 3.5 times EBITDA (current debt is around 6 times).

Prisa publishes El País, Spain's leading paper, as well as the Diario AS sports newspaper and Cinco Días economic newspaper. It also encompasses more than 400 radio stations in Spain and Latin America, along with magazine and book publishing, rights management, television broadcasting/production and music recording interests.

The group is trying to find financial partners on several of its business units. Due to its debt burden and the ongoing recession in advertising (representing a quarter of the group’s 4 billion euros in revenue last year), those measures might not be sufficient and the group could be forced to proceed to a capital hike that would affect the current ownership structure of the group.
Complete summary of the June 18 General Assembly of shareholders (in Spanish) :


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