Bauer Media suspends print magazines, cuts 70 jobs

Bauer Media is making 70 staff redundant and temporarily suspending the print editions of titles including OK! and Elle due to financial pressure caused by a sharp downturn in the advertising market and a $40 million acquisition of Pacific Magazines.

The German-owned publisher, which is planning to meet the deadline for its acquisition of Seven West Media's Pacific on Friday, said weak advertising spending caused by the coronavirus crisis had forced the company to suspend its titles Harper's Bazaar, Elle, OK! and NW, stand down more than 50 staff and make a further 70 redundant.

Harper's Bazaar is one of the titles that will be temporarily suspended.

"The decision to resume print publication will be made once the trading environment improves," the company said.

Bauer made about $800,000 a week in advertising last financial year, but that figure would now be significantly smaller due to the pandemic.

Chief executive Brendon Hill told staff in a meeting that the company was operating in "unprecedented times".

"The COVID-19 crisis and the strict measures being taken to control it are having a profound impact on the Australian economy and any business that operates in it," Mr Hill said. "This has led to a sharp decrease in advertising revenues in Australia over the short term and we have had to reshape our organisation accordingly.”

Digital content from Elle and Harper's Bazaar will continue to run online. It is unclear whether other titles are affected. Commercial media companies such as News Corp, Seven West Media and Nine Entertainment Co (publisher of this masthead) have suffered large declines in revenue during the pandemic because of falling retail sales and weak demand from advertisers.

The Sydney Morning Herald and The Age reported earlier this month that the latest redundancies at Bauer would be in the commercial side of the business and are separate to previously announced cuts planned as part of its acquisition of Pacific, publisher of New Idea and That's Life. Bauer suspended the use of freelance journalists and halted staff expense claims earlier this month. Pacific staff were told late last year if they were moving across to Bauer, being redeployed in Seven or taking a redundancy.

Bauer is still planning to meet the deadline for its $40 million deal acquisition this Friday. The takeover was expected to be completed in early April after it was cleared by the Australian Competition and Consumer Commission. However Bauer wanted to renegotiate the terms of the deal, a decision which prompted Pacific to file a case with the NSW Supreme Court to compel completion. The two companies are due in court on May 8.

All Bauer-related decisions on the transaction are being led by the company's headquarters in Germany - the same executives who led the shock decision to shut Bauer Media's New Zealand operation earlier this month. The German parent will have to provide the local division with the money it needs to complete the deal.

The deal between the two companies is significant for the Australian magazine industry, which has faced declines in circulation and advertising spending for years. The transaction will also help a challenged Seven business reduce its net debt pile of half a billion dollars.

Employees at Seven have taken a 20 per cent pay cut until the end of the financial year and last week Seven applied for the JobKeeper wage subsidy scheme.