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Newspapers owners slash salaries by 50%, reduce print pagination by 45%

Covid-19 is not sparing the 4th Estate!

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Nigeria has boasted to have the freest and most outspoken press among other African states, though the industry has consistently been the target of harassment by past military dictatorships, and even in some cases, by democratically elected Governors and Presidents. Many journalists have been imprisoned, exiled, and tortured.

As we speak, the industry and practitioners are facing a different kind of torture. This time around, not by any political office holder, but by a looming recession that has befallen the industry. Though the industry had been battling with several hurdles before the advent of Coronavirus, the pandemic is threatening its survival amid other uncertainties.

The sector, according to some journalists and industry watchers, is currently grappling with several problems, ranging from COVID-19 pandemic, depleted funds due to the lockdown across major cities, loss of revenue due to lower ad sales, looming job loss, and salaries slashed, among others.

The staff of most of the print news platforms are going through bad times. While a lot of them were informed of salary cuts from April 2020 till further notice, some have lost their jobs as their employers embarked on ‘Operation Cut Cost at all Cost’.

The unfortunate thing is that the sack is on-going. What that means is that anyone that was not sacked in April should not be over-confident, as the firms are rolling out more letters of dismissal or slash in staff salaries.

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In separate interviews, some staff of The Nation, BusinessDay, Punch Newspapers, Television Continental (TVC), and Cool FM, among others, lamented over fears of either losing their jobs or suffering more salary cuts. A lot of them told Nairametrics that their managements had told them that it would never be ‘Business as usual’, as no one could tell when the COVID-19 pandemic would be over.

In the case of The Nation, findings revealed that the medium is currently serving some staff across departments letters of disengagement. Already, over 100 out of about 500 workers (across Nigeria) have been sacked and still counting.

One of the medium’s managers, who claimed anonymity, told Nairametrics that the management told employees that the exercise would continue until the company stabilized, a time which no one can tell for now. That is not all, The Nation has also slashed salaries of everyone earning over N60,000 by 50%.

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He said, “It started when the company reduced the pages of the Newspaper from 48 to 32 pages and the excuse then was that it was due to the lockdown, which crashed the readership of the newspaper. Another notice followed that a certain percentage of the staff strength would be reduced.

“As if that was not enough, we got another notice that salaries would be cut by 50%, which was the final straw. We got confused because we had thought if people are sacked, there wont be a pay cut. This is indeed a bad time for the industry and for us here because if more people are sacked, few of us left would have to do their jobs with less pay.”

For Punch, one of the reputable and widely read newspapers in Nigeria, this is indeed a trying period. After exploring other options like slashing pages of the dailies from 62 to 32 (depending on the numbers of advertisement), the Ademola Osinubi led-management also took a COVID-19 induced decision and informed its staff beforehand. Here is an excerpt of the memo Osinubi sent to all staff:

This pandemic has dealt with our business telling and severe blows. Our circulation and advertisement revenues dipped dangerously, compounding the operational and revenue challenges birthed by the migration of a majority of print newspaper readers and adverts to digital platforms.

“I am not at liberty to disclose all of the measures that the management has taken so far. But the ones that could be made public include an immediate reduction in print pagination; staff furloughing to comply with government and expert advisories on social distancing; the temporary shutdown of the sports newspaper; and significant financial reengineering.

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“All projections point at a bleak and uncertain future for the media industry and the economy. Notwithstanding, the company’s commitment to the welfare of its staff remains cardinal, hence, the decision to pay 100% salaries in the month of April and fulfil all annual leave obligations, despite the dip in revenues. All staff, including our colleagues, asked to stay away from work in April, have been paid their full salaries.”

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But does that mean the workers should not expect full salaries in the month of May?

“Considering the fact on the ground and the body movement of the board, full salaries may not be paid in May and some people, especially in the newsroom, would be forced to resign.

“The management has started from the Sports desk and would soon move to other desks. The idea is to concentrate more on the online version of the platform and start a significant financial re-engineering,” a source in the company told Nairametrics.

The Nation and Punch Newspapers are not the only firms that have either slashed salaries or dismissed staff. While Tribune Newspaper reduced pages from 46 to 32, and slashed salaries between 10 and 35% depending on the level of the staff, BusinessDay also reduced the pages of its Monday editions, which is its major product, from 65 to 32, and New Telegraph dropped pages from 48 to 32 among others.

In the broadcast sub-sector of the industry, the workers of AIM Group, owners of Nigeria Info, Cool FM, Wazobia and Arewa, have to swallow the bitter pills too.

While trying to ensure that the majority of its staff are retained, the group had no choice but to let some of the staff embark on unpaid leave.

The Head, Human Resources of the Group, Oyinkan Adeniyi, in an internal memo seen by Nairametrics,  said:

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The Management of AIM Group has had to weigh a lot of options that can be taken during this trying times to minimize the negative impact the pandemic has had on our operations, ensure the majority of our staff are retained while still meeting up with financial obligations to you our highly esteemed employees, suppliers and other stakeholders.

“We have reached a very difficult position of placing all staff who are currently at home, not working since the commencement and who will not be working now that skeletal services will be commencing on a Furlough (unpaid leave) until things normalize. This means that while staff who are home now and not working remain our staff, they will not be paid salaries for the period not worked and until they are recalled back to the office.”

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How long it will take the media organizations to rebound, and re-engage their employees to work optimally, depends on how early the nation survives COVID-19 or how soon the Federal Government offers bail-out to operators in the industry. Though, the bail-out option may be a tall order, stakeholders are optimistic that the industry may soon be out of the woods.

Abiola has spent about 14 years in journalism. His career has covered some top local print media like TELL Magazine, Broad Street Journal, The Point Newspaper. The Bloomberg MEI alumni has interviewed some of the most influential figures of the IMF, G-20 Summit, Pre-G20 Central Bank Governors and Finance Ministers, Critical Communication World Conference. The multiple award winner is variously trained in business and markets journalism at Lagos Business School, and Pan-Atlantic University. You may contact him via email - [email protected]

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Companies

Dangote delays London Stock Exchange listing

Dangote Cement Plc isn’t expected to attempt a U.K. initial public offering until at least 2023.

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Aliko Dangote rallies private sector operators against COVID-19, 10 fantastic things Aliko Dangote has done in the last 10 years

Africa’s richest man, Aliko Dangote, is once again delaying plans to list Nigeria’s second most capitalized company on the London Stock Exchange, rather choosing other options like boosting exports and the Nigerian company’s foreign-exchange reserves in a report credited to Bloomberg.

Dangote Cement Plc, Africa’s biggest producer of building material isn’t expected to attempt a U.K. initial public offering until at least 2023, Temilade Aduroja, Head of Investor Relations, at the Lagos-based company, said by email.

READ: Dangote Cement’s faltering pan-African operations is taking its toll 

READ: Access Bank N15bn green bond set to be the first cross listing ensuing from NSE-LuxSE partnership

“The London listing is not something which will happen in the short to medium term. We are focused on our export strategy and increasing our foreign-currency revenue,” he said.

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Dangote, a major shareholder of Dangote Cement, with a net worth of more than $14 billion has longed for the company to have a secondary London Stock Exchange listing to diversify its holding and gain more leverage to cheaper funds on international markets.

READ: Rocket Internet sells stake in Jumia, as eCommerce firm struggles with post-IPO scandal

READ: Afreximbank forced to postpone IPO plan in London; here’s why 

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Aliko Dangote said in 2018 that the listing would happen the following year (2019), only for Brian Egan, former Chief Financial Officer, to state that 2020 was more likely.

More detail later as the story is developing…

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Companies

NB Plc to raise additional N20 billion from its N100 billion Commercial Paper

Nigerian Breweries has announced the continuation of its N100 billion Commercial Paper (CP) Issuance Programme.

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dividend, Nigerian Breweries reports reduced profits for first three quarters of 2019 , Analysis: Nigeria Breweries, the glory days are gone, Nigerian Breweries to raise additional N20 billion from its N100 billion CP programme

Nigerian Breweries has announced the continuation of its N100 billion Commercial Paper (CP) Issuance Programme in a bid to raise up to N20 billion to support its short term funding needs. The company has launched Series 9 and 10 of the programme for this purpose.

This information was disclosed in a notification signed by the Company’s Secretary, Uaboi G. Agbebaku, and sent to the Nigerian Stock Exchange.

The notification reads;

“[Nigerian Breweries Plc] is pleased to inform the Nigerian Stock Exchange and the investing public of the continuation of its “CP” (Commercial Paper) programme with the launch of Series 9 and 10 of the programme.

“Series 9 of the Commercial Paper programme would be for a tenor of 180 days, while Series 10 would be for 270 days. However, the launch of the CP opens today 23rd October 2020.”

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(READ MORE:Nigerian Breweries stock up by 58% since August )

What you should know

According to data obtained from Financial Market Dealers Quote (FMDQ), Nigerian Breweries has raised up to N90.12 billion since the start of the year.

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  • N52.76 billion was raised from Series 6 between February 12 to November 6, 2020.
  • N13.03 billion was raised from Series 7 from April 15 to October 14, 2020.
  • N24.33 billion was raised from Series 8 from April 15 to January 8, 2021.
  • The recent issuance of the Series 9 and 10 CP will bring the total funds raised to N110.12 billion.

Why it matters

  • The CP will help the company navigate through the recent impact of COVID-19 and other trade disruptions.
  • The programme will strengthen the balance sheet of the company, and enable the brewer to execute its plans while delivering value to customers and creating wealth for shareholders,
  • In like manner, the CP programme is expected to provide opportunities for non-equity investors to invest in the company and support its cost management initiatives.

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Companies

MTN shareholders have made approximately N1 trillion since April 2020

Shareholders of MTN Nigeria gained close to a trillion naira in less than 7 months.

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MTN Nigeria, MTN Nigeria Communications Plc. begins N100 billion commercial paper issuance today, MTN Nigeria Communications Plc: increase in other income, others boost revenues.

MTN Nigeria shareholders have gained N986.58 billion since the first trading session in April 2020.

This was uncovered by calculating the difference in the telecommunication giant’s market capitalization of ₦1.832 trillion at the open of trade, for the first trading session in the month of April 2020, and the market capitalization of ₦2.646 trillion at the close of trade in the first trading session in the month of October.

READ: Shell to cut 9,000 jobs globally due to oil price crash as it shifts to clean energy

This gives a whopping N814 billion increase in market capitalization, and this with the dividend the company has paid to shareholders on two occasions between this time period, brings the total gains both realized and unrealized to approximately N1 trillion.

READ: FUGAZ; Nigerian banks considered too big to fail

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Hence, the N814 billion increase in market capitalization translates to the joint gains MTN investors have made from the increase in the shares of the company, as the share price of the company has increased by 44.44% or ₦40.00 between April 1, 2020, and October 2, 2020, with the share price of increasing from ₦90.00 to ₦130.00.

However, the gains MTN NG investors have made from their investments in the telecommunication company, is not limited to the gains driven by the increase in the price of the shares.

READ: World Bank says Nigerian banks are at risk of being destabilised by COVID-19

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Recall that the company declared payment of dividends to its shareholders on two occasions, as investors/shareholders of the company, whose names appear in the Register of Members, as of the close of business on April 17, 2020 and August 14, 2020 were paid a cumulative dividend per share of ₦8.47, for all the outstanding shares of 20,354,513,050 held by the shareholders, and this translates to a total dividend payout of N171 billion by the company to its shareholders.

It is noteworthy that the realized and unrealized gains MTN investors have made from holding the shares over this period stands at N986.58 billion.

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