The company that owns Utah's largest television and radio stations announced Thursday it will implement drastic cost-cutting measures to offset industry difficulties and falling revenues resulting from the economic downturn.
In a memo to employees, Salt Lake City-based Bonneville International said it is responding to "slow economic indices and market conditions that are producing below-projected revenues industry-wide."
The cutbacks include salary reductions for higher-paid employees, adjustments to vacation and accumulated time off, as well as termination of company-sponsored health-club memberships.
"Our corporate management team and market managers have looked at this very carefully and thoughtfully," said Bonneville President and Chief Executive Bruce Reese. "We believe these adjustments are reasonable and necessary to maintain the health of our company and its valued employees."
The privately held media corporation, Reese said, is "not immune from today's economic realities."
"We, like most people, thought the economy would be bad the first part of the year, but better by the second half," Reese told the Deseret News. "What happened (was) ... the first half of the year was worse than we anticipated, and the second half of the year — while there are signs that things are improving — we still have a way to go."
"Our ownership is not short-term in its approach to our business," he said. "I know that Bonneville continues to be a leader in this industry, especially in terms of the quality of the people who work here and the products they produce."
He said that like numerous other media organizations, Bonneville properties across the country have felt the pain of reduced advertising revenues, but the situation could be worse.
"In the radio industry, (ad revenues have seen a) 25 percent decline in the first half of the year," he said. "We're off about 15 percent."
He added that industry forecasters are now predicting it will be sometime late next year before advertising revenues begin to rebound.
Meanwhile, Reese said, the company will continue to be responsive to its employees in the most prudent and sensitive way possible.
Bonneville International was founded in 1964 and traces its early roots to KSL Radio, first on the air in May 1922 (originally as KZN — owned by the Deseret News), and KSL-TV, which debuted in 1949. Reese said nationwide the company employs approximately 1,100 full-time workers, with about 400 in Salt Lake City.
The company is a subsidiary of Deseret Management Corp., an operating company that manages the for-profit holdings of The Church of Jesus Christ of Latter-day Saints. The Deseret News also is a subsidiary of Deseret Management.
Bonneville International owns and operates 29 radio stations in Salt Lake City, Los Angeles, Chicago, Seattle, Phoenix, St. Louis, Cincinnati and Washington, D.C. In addition, the company owns NBC affiliate KSL 5 Television in Salt Lake and runs online services and operating divisions Bonneville Communications and Bonneville Satellite. In describing the morale of the company's staff in the wake of Thursday's announcement, Reese said "nobody's happy, but there was an appreciation that this was a step that was reluctantly being taken. And I think they reluctantly accepted."
Contributing: Scott Taylor
e-mail: jlee@desnews.com