80-Plus Layoffs at Source Interlink
Company moves to reduce redundancy and cut costs.
The layoffs that have rocked the publishing industry have come to Source Interlink. The Bonita Springs, Florida-based distributor and enthusiast magazine publisher recently laid off “upwards of 80 employees,” a knowledgeable source told FOLIO:.
A Source spokesperson confirmed the layoffs but declined to say exactly how many were affected or offer any additional details. “As with most companies in these economic times, the company is sharpening its focus on core initiatives designed to enhance our efficiencies and profitability going forward,” the spokesperson wrote in an e-mail to FOLIO:.
“We are diligently working on aligning our resources better, eliminating redundancy and decreasing cost, the spokesperson wrote. “These initiatives, which have included some work force reductions, are intended to benefit all of our stakeholders, including the 6,000 employees we have nationwide. We believe that our actions will better enable us to compete most effectively and ensure our long-term success.”
Source—which made headlines in 2007 when it acquired Primedia Enthusiast Media in a stock purchase of approximately $1.2 billion—reported a net loss of $296.7 million for the six month period ending July 31, compared to a $4 million net income for the same period last year. Net revenue for the period was $1.1 billion, up from $909 million during the period last year.
At the time, then chairman and CEO Michael Duckworth cited declines in advertising and circulation revenues in its media division, and indicated that the company merged three “underperforming” titles with other titles within its portfolio during the period.
In October, Source replaced Duckworth as chairman and chief executive with a member of its board of directors, Great Atlantic & Pacific Teas Company director Greg Mays.
Source publishes more than 75 magazines—including Motor Trend, Automobile and Power & Motoryacht—and distributes DVDs, CDs and books.