Nation Media Group (NMG) fired its radio journalists from Nation FM and Q FM a decision that was informed by its slight dip in profits. The company’s total revenue reduced slightly and with a change of Group Managing Director, a new CEO will want to stamp his authority and return the company to profitability.
Mr. Joe Muganda took over from Mr. Linus Gitahi as the Group Chief Executive Officer.
In 2013, the company’s revenues were sh13, 373, 700, 000 while in 2014, the revenues were sh13, 351, 300, 000 representing a dip in revenue of sh22, 400, 000. This represented a 0.17 percent drop in profits, something the Aga Khan may not want to see repeated.
In addition, this year, NMG’s half-year profit before tax dropped from Sh1.56 billion to Sh1.43 billion posted in the first six months of last year. The company attributed the drop to significant disruptions from the digital migration stand-off with the regulator the Communications Authority of Kenya (CAK).
Already, the company killed the Media Lab, a one of its kind media training program that helps horn its journalists for one year. Indications are that it could return with a smaller budget and to run for a shorter period of time. This decision was made since the Aga Khan University Media School has been set up and could now take over rigorous training of journalists at a fee.
Sacked journalists were given dismissal letters on Monday and Tuesday. Each letter indicated that they will be paid two months salary. In additional a month’s salary for every year worked in the company.
There is tension at twin towers as other journalists are likely to follow suit, in a bid to reduce the wage bill and ensure maximization of the current capacity. National pays its interns meaning that while the gap that remained is huge, bringing interns is out of question as it will be another cost which the company does not want to entertain.
Currently, Nation FM only has four news readers and one manager, the head of radio news. They will be expected to aggregate news from NTV and the newspaper divisions and still provide it timely like before. However, they are unlikely to do it robustly.
Hopefully, the bottom line changes for twin towers so that the shareholders are happy. Even with the slight dip in profits, the company still gave shareholders dividend of sh2.50 per share (100 percent) and to approve the payment of the final dividend of sh7.50 per share (300 percent) on ordinary share capital.