Robert Guth Becomes Reader's Digest Association's Third CEO in 2011
Guth succeeds Tom Williams, who replaced former CEO Mary Berner.
In another turn of events in Reader Digest Association‚Äôs executive saga, Robert Guth, former CEO of telecommunications company TelCove, is named president and CEO. Guth replaces Tom Williams (who occupied the CEO seat after Mary Berner left the company), as he exits the company.
According to Adweek, Guth, in an in-house email to staff, ‚Äú‚Ä¶gave a blunt assessment of RDA, acknowledging frustration with the recurring leadership changes and pessimism in the ranks." Guth said the company has an "unbelievably strong core business" but that it wasn‚Äôt "performing to its potential" and that he was put in place to enact "significant changes.‚ÄĚ
Williams stepped up from his role of CFO to act as both CEO and president of RDA after Berner‚Äôs departure in April. She left in the week following RDA‚Äôs naming of a new board of directors, which originally included her in the roster. After Berner‚Äôs departure, CEO of telecommunications company DELTACOM, Inc. Randall Curran became chairman of the board.
In May, RDA tapped Paul Tomkins, former vice president controller of AT&T Business Solutions, as CFO and executive vice president in Williams‚Äô place.
Guth joined the RDA Board of Directors in April 2011. He takes the helm of the company at a turbulent time. In July, Reader‚Äôs Digest was supposedly put on the block; The Wall Street Journal cited the price tag to be worth at least $1 billion. Parent company RDA Holding Corp. announced a 6.2 percent drop in revenue to $409.4 million in the second quarter of 2011. Revenue for the RDA‚Äôs U.S. business managed to stay basically flat in Q2 2011 at $176.7 million, as compared to Q2 2010‚Äôs $177.1 million.
Operating profit for the company fell 15.1 percent to $33.1 million in the second quarter, which was attributed to a ‚Äúdecrease in advertising at Rachael Ray and higher agent commissions‚ÄĚ in financial statements. Every Day with Rachael Ray, which debuted a redesign in May 2011 under editor-in-chief Liz Vaccariello‚Äôs tutelage, saw ad pages fall 16.8 percent in first half 2011 from first half 2010, according to FOLIO: sister publication minonline. However, Reader‚Äôs Digest is saw a decent first half 2011, as ad pages were up 4.4 percent according to Publishers‚Äô Information Bureau.