Independent Digital News and Media, owner of the Independent and Indy100 websites, has put a “limited number” of staff on furlough and cut wages for all remaining employees.
The group is the latest national news publisher in the UK to take action over Covid-19, with all now having imposed measures to shore up against the financial impact of the virus.
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It comes as the group, which is owned by Evening Standard proprietor Evgeny Lebedev, recorded its highest ever audience last month.
The publisher is reliant on advertising for up to 75 per cent of its revenue, but has seen the ad market fall by as much as 50 per cent this month. The slump is forecast to continue across May and June.
That equates to hundreds of thousands of pounds in lost revenue, IDNM chief executive Zach Leonard told staff on a video call announcing cutbacks today.
“If that were to continue through the year it will be a significant threat to our overall financial position, and particularly those driving our future growth and ambition,” he said.
“The supreme irony here is that we’ve come off the highest month we’ve ever achieved in audience – long may that continue – and our advertising is flowing, it’s just flowing in a different way and at a much lower advertising pricing scheme and rates that we cannot control.”
Although it also brings in revenue from subscriptions, including the Independent’s premium content paywall, and other sources, these are of “insufficient scale” to cover the fall in ad revenue.
“These revenue shortfalls will not recover for some months,” Leonard added in an email to staff.
As well as freezing recruitment, all those not put on paid leave will take a 20 per cent salary cut from next month, which is expected to last until at least the end of June this year.
Those earning less than £37,500 a year will be exempt from the pay cut, however.
Said Leonard: “Whilst these measures will bring short-term hardship to all colleagues, we are confident that they will contribute to a more robust and more agile Independent when the advertising market recovers, and our direct-to-consumer services grow to sufficient scale in the UK and US, to propel us to new records.
“We have a tremendous history of innovation, reinvention and pioneering.”
Press Gazette understands staff were only given 15 minutes notice of the video call announcing the new measures and that there was no time for questions afterwards.
Independent editor Christian Broughton did however tell staff that he was available to speak to anyone who had questions after the call.
“We’ve always tried to be open and to explain the reasoning behind things,” he said.