SCA share price slips after mass job cuts in ‘difficult market’
After news broke of mass redundancies at Southern Cross Austereo yesterday, the company’s shares dropped 3.68%.
However, many analysts expect the market to react favourably to the cost savings in quarters to come.
As first reported by Radio Today, about 90 SCA staffers will lose their jobs this week as the media company faces a “challenging and difficult market”.
SCA was unable to comment on, nor confirm, the number of people affected as negotiations are continuing. But SCA did, however, provide a statement to Radio Today.
“The entire advertising and media sector is operating in a challenging and difficult market and Southern Cross Austereo has and is being equally affected,” a spokesperson told Radio Today.
“Management, with the support of the board, have conducted a comprehensive review of our workforce structure to provide an effective and efficient organisation for now and into the future.
“These proposed changes will impact some of our people. These decisions have not been taken lightly and we are committed to supporting our people as we work through this process.”
SCA shares closed at $0.92 on Tuesday (December 3). They also hit a five-year low in October, down 23% to $0.885 following a historically weak September quarter.
SCA also released its financial year results for 2018/19 in August, and despite an increase of 0.5% in overall group revenue, the company reported a net annual loss of $91.3 million. Underlying EBITDA grew only 0.9%.
Radio Today has also learned that a round of redundancies took place between August and September this year as the company looks to future proof its business.