Future Network is to close or sell twenty of its magazines in an attempt to streamline its portfolio and reduce the company’s debt. The group, which has issued two profits warnings in the last four months (see Future Network Issues Second Profits Warning), warned earlier this year that underperforming titles would have to go, after investment levels for 2001 were cut from £30m to £20m (see Sharewatch Focus: Future Network).
Flagship title, Business 2.0, is one of the titles being considered for sale. Morgan Stanley Dean Witter has been appointed to review strategic alternatives for the next stage of the development of the US-based mag, which is reported to have lost revenues of £40m last year.
Within the UK six smaller titles are to be closed, while the French and German subsidiaries of the group will lose eight titles. A further six magazines in the US face closed including music magazine Revolution and the US edition of T3, and overhead costs across all subsidiaries are to be reduced.
The group’s internet activity is to be refocused across its most successful websites with the closure of five smaller sites and the loss of around 75 staff in the US and the UK. Overall 350 jobs are expected to be lost, out of the current workforce of 2000.
The closure of these titles, which account for 7% of group revenues, will allow the company to reduce its investment spend in 2001 by approximately £5m to below £15m, including the losses already incurred on these titles in the first quarter of 2001.
Commenting on the changes, Greg Ingham, CEO of the Future Network, said: “Following a prolonged period of growth, Future has recently faced much tougher market conditions. In response, we are refocusing our customer activities around the high-passion specialist consumer audiences we have built our business on.”
Looking ahead, he said Future remains the world leader in the computer games market and looks forward to the roll-out of Sony Playstation 2, for which the group publishes the official magazine, and the launch of The Official XBox Magazine in the US later this year.
Future Network: 01225 442 244
