McClatchy to cut work force by 10 percent

By Robert MacMillan

NEW YORK (Reuters) - U.S. newspaper publisher McClatchy Co plans to cut its work force by about 10 percent, or about 1,400 jobs, as part of a restructuring plan to deal with a damaging drop in advertising revenue.

The cuts will be the largest at McClatchy in recent history. They will be achieved through layoffs, buyouts and leaving jobs open, McClatchy said in a statement on Monday.

Chief Executive Gary Pruitt said in an interview that he hoped to avoid further broad job cuts but that he did not know when the worst will be over for the industry.

Like many U.S. newspaper publishers, McClatchy is dealing with a downturn in the wider U.S. economy and the migration of paying customers away from its papers. The primary result of these trends is a persistent decline in advertising revenue, particularly in real estate, automobile and employment.

"I can't tell you where the bottom is," Pruitt told Reuters. "We are still facing a very rugged advertising environment and I can't say we have bottomed yet."

McClatchy shares were off 13 cents, or 1.6 percent, at $8.02 in afternoon trading on the New York Stock Exchange.

Pruitt said newspapers and their online components remain strong franchises but in the meantime they must cut costs.

"McClatchy will likely end up with online revenue around a couple hundred million dollars this year," he said. "But it will not equal print revenue in the foreseeable future."