Layoffs at Time Inc.
Time Inc. staffers were informed today that layoffs lie ahead in the New Year, Capital has learned.
The publishing giant has implemented cuts in recent years while reining in costs. Just under a year ago, 500 jobs were slashed from the company, which owns magazines including Time, Sports Illustrated and People.
During Time Inc.'s quarterly management meeting this morning, which convened the company's top executives and other high-level employees, chief content officer Norm Pearlstine confirmed during an interview with Time managing editor Nancy Gibbs that the cuts will continue next year, according to three sources who were present.
Pearlstine, who rejoined the Time Inc. fold from Bloomberg L.P. last month, didn't go into specifics, our sources said, but he emphasized that the company didn't want to have to keep resorting to such measures and cutting its way to growth.
On the bright side, chief executive Joe Ripp announced that merit-based raises would be reinstated in 2014 after being put on hold during the tenure of previous C.E.O. Laura Lang, sources said.
Today's meeting was held as Time Inc. prepares to be spun off from its parent corporation, Time Warner, in early 2014. As a standalone public company, it will be expected to improve the finances of its various titles, which have been grappling with a difficult advertising climate industrywide and shifting consumer reading habits.
Time Inc. generated $440 million in operating income last year on nearly $3.5 billion in revenues and is expected to lift off with a reported $500 million to $1 billion in debt. The company had more than $1 billion in profits 10 years ago.
The top executives who spoke at today's meeting refuted a report that Time Inc's IPO could be delayed until late 2014. It is still on track for the second quarter of the year, they said.
They neither confirmed nor denied a report in the New York Post late last week that the coming cuts will total around $125 million. Ripp said they had just completed a five-year plan and that it would be presented to Time Warner C.E.O. Jeff Bewkes for approval this afternoon.
In another bit of news, Ripp revealed that People will increase to a hefty 38-pound paper stock, the highest-quality paper the magazine has had in at least 15 years, he said.
A Time Inc. spokesperson declined to comment.