Struggling American Media Inc. is the latest magazine company to cut staff in the face of softened newsstand and ad sales across the industry.
A total of 12 people were let go this week, including five from the business side at celeb weekly Star, or about 16 percent of its staff. Men’s Fitness also took a hit, losing two in its marketing department. The company employed about 800.
Earlier this year, the company shed two high-ranking executives, president and chief operating officer John Miller and editorial director Bonnie Fuller.
The declining financial picture has strained the celebrity, health and fitness magazine publisher as it has struggled to make interest payments on debt it carries. This year through September, AMI’s total ad pages declined 5.5 percent, per a company regulatory filing.
But newsstand sales, a significant revenue source for AMI, also have been off at a time of growing competition in the celeb weekly category and waning consumer spending. AMI’s celebrity titles’ newsstand sales declined 5.9 percent for the first half of the year, per its filing.
In the second half of this year, Star missed its 1.25 million rate base guarantee on 11 out of 21 issues, per company estimates filed to the Audit Bureau of Circulations’ Rapid Report. At the National Enquirer, 16 of 21 issues in the same period sold below its 956,095 average total paid and verified circ for the first half of 2008 (the weekly doesn’t guarantee a rate base).
“We’ve held off a long time without any layoffs,” Star publisher David Jackson said, pointing to consumers’ reluctance to spend at the newsstand and slow decision-making by advertisers. Jackson said he expected Star to nab new business in personal care, packaged goods and pharma next year, though, a result of its conversion to a glossy from a tabloid five years ago. “We still have a lot of growth opportunity.”