It's tough times for Westwood One. Faced with mounting competition from Clear Channel's Total Traffic Network, and the company looking to boost revenue and a stock price that has fallen to a 52-week low below $1, Westwood One announced Friday (Sept. 12) plans to reorganize the traffic operations of its subsidiary, Metro Networks. In addition to the reengineering of Metro Networks, Westwood is also reexamining its programming lineup to sift out underperforming properties, upgrading its sales force, and looking to reduce corporate expenses.
The company said all those actions should result in annualized cost savings of $25 million to $30 million.
As part of Metro's restructuring, Westwood is transitioning to a digital platform, enabling the company to consolidate traffic resources from 60 operations into 13 regional hubs by the end of second quarter next year.
Consolidation will result in a staff reduction of about 15 percent.
"The enhanced digital platform, overall changes in communications technology and scale benefits of larger, 24/7 hub centers better position Westwood One as the go-to source in the traffic business. As a result, the business is better aligned to create cost efficiencies that improve the Company's overall profitability," said Tom Beusse, who took over as president and CEO of Westwood One at the first of this year.
The Company also anticipates taking a restructuring charge between $20 million to $24 million in third quarter.