Layoff Charge Fuels Loss for QuebecorQuebecor posted a $154 million loss for the fourth quarter of 2001 after slumping ad sales paired with the costs of a staff reduction begun in October affected earnings, the company said.
The print and publishing firm's layoffs of 3,000 employees, 8 percent of its worldwide work force, resulted in a $270 million pretax charge in the quarter, costing the company about $130 million in cash. The charge was the "first substantial non-acquisition restructuring charge we have taken in our history," said Charles Cavell, president/CEO Quebecor, Montreal.
The results represent a 245 percent drop from fourth-quarter 2000, when Quebecor posted an income of $106.3 million. For the year 2001, Quebecor recorded income of $22 million, down from $295.4 million in 2000.
The year was disappointing for Quebecor, after the company experienced record ad spending in 2000. However, the company said it had been on track to match its 2000 performance until the Sept. 11 disaster and that its aftermath caused a major drop-off in business.
Reduced print volumes in late 2001 are expected to continue in 2002, Quebecor said.