By: Jennifer Saba In a letter sent to Belo employees yesterday, Chairman, President and CEO Robert Decherd warned of a challenging 2005 due to mixed results at its flagship paper, The Dallas Morning News, and TV station, WFAA-TV, in Dallas. Citing estimates that next year's growth for the industry is looking lackluster, Decherd said, "The Management Committee is actively evaluating how best to position Belo's operations to match up with this outlook."
On top of the uneven advertising climate that many newspaper companies are facing, Belo has the added burden of addressing the circulation misstatements announced in August and the resulting shareholder lawsuits brought against the company.
The majority of Decherd's letter addresses these issues, and after praising management for its efforts, Decherd went on to outline the plan of attack: "First, let me say how proud I am of our teams at The Dallas Morning News and throughout Belo who have rallied to address the circulation overstatement."
On Aug. 16, the company announced an advertiser's compensation program to the tune of $26 million. Already, 19,000 checks have been "mailed or personally delivered to advertisers," Decherd confirmed.
Howard Sutton, publisher, president and CEO of The Providence (R.I.) Journal, who was appointed head of the internal task force, is expected to present in two weeks his recommendations to change the way circulation is counted and managed. Responsibility for counting circulation at the Morning News has already been reassigned to the financial department.
Decherd also restated that he is "recommending to the Compensation Committee of the Board of Directors that executives in the chain of command accountable for circulation at the Morning News and certain members of our Management Committee, including myself, receive no 2004 bonuses and no base salary increases for 2005."
Decherd closed the letter by urging employees to report any known "problematic behavior" through human resources or the confidential Belo Compliance Hotline.
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