Monitor Publications cuts pay as Vision Group lays off staff

News media companies hit by falling advertising and print sales

Monitor Publications Limited, part of the Nation Media Group, became the latest media company to cut salaries of its employees in response to a decline in revenue caused by the coronavirus outbreak.

A letter sent to employees on Friday said that the company’s management had taken the “hard but necessary decision” to implement temporary salary reductions for the three months of May, June, and July.

Employees earning gross salaries above Shs15m per month will have their monthly pay cut by 30%, according to the letter, while those earning between Shs10m and Shs15m will take a 25% cut. The Shs5-10m band will take a 20% cut; Shs3-5m will have their pay reduced by 15%, while staff earning between Shs1m and 3m will take a cut of 10%.

The company said its business has been hurt by the Covid-19 pandemic and the lockdown instituted in March to control the spread of the coronavirus.

“You are also aware that our business is heavily reliant on advertising and circulation revenue, both of which have significantly dropped since March when a nationwide lockdown was announced by the government,” read the letter. “With the fast-declining income, the company is unable to sustain its normal operations.”

Related: Business activity shrinks at fastest rate on record in April

The letter added that the company has instituted several cost-cutting measures to stay operational, including suspending the Luganda-language football publication, Ennyanda.

Monitor Publications joins Vision Group in instituting cost-cutting measures to weather the impact of the coronavirus. Last month, Vision Group announced that it would cut salaries of its staff by up to 60% starting this month “until further notice,” blaming the “downturn” caused by the Covid-19 pandemic.  

However, a letter seen by this website shows that Vision Group is terminating some employees, in addition to the salary cuts.

“The company regrets to inform you that due to business considerations and inevitable closure of regional papers, your employment has been terminated with effect from 14 May 2020,” reads a letter dated 12 May and signed by the company’s editor and human resource manager.

Vision Group publishes the New Vision and its weekend titles, The Kampala Sun, a weekly tabloid, and the daily Luganda-language tabloid, Bukedde, which is also  Uganda’s best-circulating newspaper. Its regional newspapers include Orumuri, published in Runyankore/Rukiga, the Luo-language Rupiny, and Etop, published in Ateso.

Although news media companies were allowed to operate during the lockdown, after being designated “essential” services, advertising revenue has declined in the period following the closure of most businesses. This has also led to a decline in revenue from circulation – corporate subscribers add up to a considerable proportion, while most sales are in the Kampala metro.

Advertising revenue accounted for 65% of Vision Group’s revenue in the twelve months to June 2019, while circulation and commercial printing accounted for 23% and 11%, respectively. Print advertising was just over half of total advertising income at 52.6%, followed by television at 30.6%, radio at 13.4%, and digital advertising at 3.4%.

The government-controlled company reported an increase in advertising revenue of 11.3% in the half-year to December 2019. On the other hand, income from events, circulation, and commercial printing declined by 38.9%, 8.3%, and 1.5% respectively.

Related: Circulation falls for Uganda newspapers in fourth quarter of 2019