Jobs fear as 'Sunday Business Post' goes into examinership
Printing contract for 'Post' and other titles has been dissolved
THE 'Sunday Business Post' will slash up to a third of the newspaper's workforce and ask remaining staff to accept their third pay cut in as many years if it survives an examinership that started yesterday at the High Court.
The news comes as fears grow for 50 jobs at Webprint in Cork, an outside company that had the contract to print newspapers including the 'Sunday Business Post' and the 'Irish Examiner' for Thomas Crosbie Holdings until the media group that owned the 'Sunday Business Post' went into receivership this week.
That printing contract no longer stands as a result of the receivership.
The chief executive of Webprint, Donagh O'Doherty, could not be reached for comment yesterday.
Accountant Michael McAteer of Grant Thornton was appointed as interim examiner of Post Publishing Ltd, which owns the 'Sunday Business Post' newspaper, at the High Court in Dublin by Mr Justice Peter Kelly.
An interim examiner needed to be appointed straight away so that a newspaper appears this Sunday, the court heard.
Failure to publish an edition of the newspaper would seriously affect the confidence of advertisers and consumers, and could undermine its future chance of survival, the court was told.
There is a reasonable chance that the business can survive following an examinership, if certain conditions are met, the judge said.
"Examinership is desirable and necessary," he said.
The court was told that the Sunday newspaper has a staff of 76 full-time staff and as many as 120 freelance contributors.
Fresh investment in the business will be needed as part of a rescue deal, if the company is to emerge from examinership.
A number of potential buyers have expressed an interest in buying the paper, the company said.
Post Publications has been loss-making since 2009. The loss for 2012 was €1.2m.
The loss this year will be €1.4m but a return to profit is projected for 2014, according to the directors of the business. That will come about as the wider economy returns to growth.
"We don't see much evidence of that in the Commercial Court, maybe outside," Mr Justice Kelly said.
Revenues at the newspaper have halved in the last five years to €7.4m. Income from advertising, a mainstay for newspapers, fell by two-thirds.
The company is almost €600,000 behind on its rent, the court was told.
Landlord Irish Life has only been paid half its €400,000-a-year rent over the past two years, and has unsuccessfully been trying to negotiate a rent reduction.
MR Justice Kelly was told up to 25 redundancies may have to be sought at the newspaper as part of a restructuring.
An independent accountant's report concluded there is a reasonable prospect for the survival of the newspaper as a going concern, providing certain conditions are met, including the support of AIB, which has confirmed it will support the newspaper as the examinership continues.
The appointment of an interim examiner means that staff payments will be honoured, and suppliers will be assured that new contracts will be met.
AIB says it will provide €150,000 in emergency loans to the examiner, that will be needed when the company's own resources are exhausted – probably 13 weeks into the process, the court was told.
A hearing to formally appoint the examiner will take place on Friday next.