"Every department at the station was affected to minimize the impact on any one department," said KOLD vice president and general manager Jim Arnold. "We mainly wanted to (have) the least impact on-air (and on) our ability to service. Everything with us was a position elimination and consolidation. The medium is having less organizational silos and more multitasking for everybody. ... This economy is spurring it sooner rather than later."
The move was part of a national reduction by parent company Raycom Media. In Tucson, the layoffs amounted to a 7.2 percent decrease in KOLD's workforce.
Arnold is hopeful that this will be the last round of cuts--but given the national financial landscape and the negative economic slide in Southern Arizona, nothing is certain.
Meanwhile, KVOA Channel 4 gave pink slips to an engineer and a marketing employee as part of a staff restructuring, sources tell the Weekly.
The real concern is what has happened within the last two months. In mid-October, the stock had plummeted to $1.44. By Nov. 25, it broke through the dollar barrier--a number necessary to maintain status on the New York Stock Exchange (NYSE).
Last week, Lee stock went into cliff-diving mode, dipping as low as 34 cents before something of a Friday rebound, likely from investors who saw an opportunity to make a quick profit. As of Monday, Dec. 15, Lee shares had drifted back toward the 40-cent range.
One big problem: Lee's income-to-debt ratio is terrible. It owes $1.3 billion, largely because of its 2005 purchase of Pulitzer, and on Oct. 30, the company announced the suspension of dividends and the need for credit renegotiations. As ad revenues have declined, some analysts have placed Lee on bankruptcy watch.
As for its stock situation, Lee is in the midst of a 30-day window to get the average value above a dollar. If that doesn't happen, the stock will be put on notice, and the company would have six months to improve its positioning or face NYSE delisting.
Lee isn't the first media company to endure this dilemma. Among others, Citadel Broadcasting, which owns a conglomerate of radio stations in Tucson--including one that employs me on a part-time basis--has been trading below a buck (more like below 20 cents) for some time. Sirius XM Satellite Radio has hovered in the 16-cent range.
These companies may consider a 10-to-1 reverse split, a move that pushes the price of the stock over the dollar threshold (in Citadel's case, from, say, 18 cents to $1.80), but doing so obviously cuts the actual number of stocks by 90 percent. It's a zero-sum game put into play by struggling companies in an effort to buy time, with hopes that better days are on the horizon.
For a lot of media outlets, the horizon seems to be getting further away.
Whether you grew up in Tucson or migrated here from somewhere else, take a moment to reflect on some of a community's most recognizable names. The likelihood is you're going to come up with at least one car dealer. In Southern California, everyone knows to go see Cal Worthington. In Phoenix, Tex Earnhardt is something of an institution. In Tucson, it's Jim Click. This isn't to compare Click to Worthington and Earnhardt in terms of corniness, but to make the point that the reason they're as well-known as they are is because they throw massive amounts of money into advertising.
Car dealers are responsible for one of the greatest chunks of revenue in local ad sales, but as a result of the massive consumer downturn, advertising has been affected. Some media markets have reported drops in revenue from auto dealers in the neighborhood of 7 to 12 percent. The exact tally in Tucson is uncertain, but one station manager admits the market has been impacted.
If there was no interruption, you're good to go.