stats
globeinteractive.com: Making the Business of Life Easier

   Finance globeinvestor   Careers globecareers.workopolis Subscribe to The Globe
The Globe and Mail /globeandmail.com
Home | Business | National | Int'l | Sports | Columnists | The Arts | Tech | Travel | TV | Wheels
space


Search

space
  This site         Tips

  
space
  The Web Google
space
   space



space

  Where to Find It


Breaking News
  Home Page

  Report on Business

  Sports

  Technology

space
Subscribe to The Globe

Shop at our Globe Store


Print Edition
  Front Page

  Report on Business

  National

  International

  Sports

  Arts & Entertainment

  Editorials

  Columnists

   Headline Index

 Other Sections
  Appointments

  Births & Deaths

  Books

  Classifieds

  Comment

  Education

  Environment

  Facts & Arguments

  Focus

  Health

  Obituaries

  Real Estate

  Review

  Science

  Style

  Technology

  Travel

  Wheels

 Leisure
  Cartoon

  Crosswords

  Food & Dining

  Golf

  Horoscopes

  Movies

  Online Personals

  TV Listings/News

 Specials & Series
  All Reports...

space

Services
   Where to Find It
 A quick guide to what's available on the site

 Newspaper
  Advertise

  Corrections

  Customer Service

  Help & Contact Us

  Reprints

  Subscriptions

 Web Site
  Advertise

  E-Mail Newsletters

  Free Headlines

  Globe Store New

  Help & Contact Us

  Make Us Home

  Mobile New

  Press Room

  Privacy Policy

  Terms & Conditions


GiveLife.ca

    

PRINT EDITION
Shaw says quarter of workforce taking buyouts amid overhaul
space
space
By CHRISTINE DOBBY
  
  

Email this article Print this article

space  Advertisement
space

Friday, February 16, 2018 – Page B1

Shaw Communications Inc. says one quarter of its work force, including its chief financial officer, will take buyouts over the next 18 months as the company slashes costs in a sweeping business overhaul.

Facing declining revenue growth in its legacy television business, the Calgary-based telecom is betting on the future of its still small Freedom Mobile wireless division.

Less than three weeks ago, Shaw gave 6,500 nonunionized employees the option to take voluntary severance packages, but said it expected just 10 per cent, or 650 people, to accept the buyouts; on Thursday, it said 3,300 employees had taken the offer - one-quarter of the company's workforce.

Shaw president Jay Mehr said in an interview that the company did not retain the option to reject buyout applications of employees who chose to take the offer, as the program was designed to give workers control, but Shaw was able to stagger the timing of their departures over the next yearand-a-half.

"Is it a messier way to do it than the old way of management, just deciding and laying off people? It's certainly a new way, it's a generous way," he said when asked whether the company mishandled the layoff process. "We considered a range of scenarios, and the actual uptake falls within what we considered.

Clearly, it's at the high end."

Shaw said it will record a $450-million restructuring charge in the second quarter of its 2018 fiscal year, while the actual payments to employees who have taken the buyout will be spread over 18 months. In the longer term, it expects to save $225million on an annualized basis by 2020.

Shaw is cutting more than 25 per cent of its managers through the buyouts, Mr. Mehr said, including its CFO, Vito Culmone, who will leave the company on May 4. He will be replaced by fellow Shaw executive Trevor English, who will take over a combined finance and corporate-development department.

Mr. English, a Shaw veteran of 20 years, was a key figure in many of the company's recent strategic moves, including the sale of media assets to Corus Entertainment Inc. and purchase of Wind Mobile (now dubbed Freedom) in 2016.

"Trevor's done a terrific job leading us through the strategic acquisitions and Vito's also made an amazing contribution to Shaw," Mr. Mehr said.

"None of this is easy."

He said the company is "letting wireless run, because we have a growth opportunity there," but is looking for a better profit margin for its video service. Cable- and satellite-TV subscriptions have been declining as more customers cut the cord. The company also faces tough competition from Telus Corp. in British Columbia and Alberta.

Shaw wants to trim costs through online or mobile-based options for customer support.

Most customer-facing workers were not eligible for the buyouts, but certain cable installers and technicians were, Mr. Mehr said, adding that the company also plans to move to a less expensive "self-install" model for its television service. The average tenure of staff taking the buyout is 10.6 years.

"Our road map is clear that a broadband connectivity customer goes to the MyShaw app and chooses the video product they want to have in their home.

"Within a couple of hours, a hockey puck-sized device is delivered to their home, they take a picture of the barcode of that device and they have TV working.

"That's an example, but that is right at the core of the total business transformation," Mr. Mehr said.

Analysts said the staff cuts were greater than expected and predicted some risk in how the company will manage the changes over the next year-anda-half.

They also argued, however, that Shaw needed to overhaul its cost structure to reflect the reality of much lower growth for its legacy television business. Most took Mr. Culmone's departure in stride.

"In our view, it is never a positive for the stock when a respected CFO departs, but, in this case, [Trevor] English is also a well known and respected senior executive who was instrumental in the shift from media to wireless, a move we think was very positive for investors," said Macquarie Capital Markets analyst Greg MacDonald.

Desjardins Securities's Maher Yaghi warned that even with the "streamlining strategy," Shaw remains vulnerable to competition from Telus and added, "we also believe that further hires are possible down the road as the rollout of wireless is likely to require additional staff."

SHAW COMMUNICATIONS (SJR.B) CLOSE: $26.65, UP 9¢


Huh? How did I get here?
Return to Main Leah_McLaren Page
Subscribe to
The Globe and Mail
 

Email this article Print this article

space  Advertisement
space

Need CPR for your RSP? Check your portfolio’s pulse and lower yours by improving the overall health of your investments. Click here.

Advertisement

7-Day Site Search
    

Breaking News



Today's Weather


Inside

Rick Salutin
Merrily marching
off to war
Roy MacGregor
Duct tape might hold
when panic strikes


Editorial
Where Manley is going with his first budget




space

Columnists



For a columnist's most recent stories, click on their name below.

 National


Roy MacGregor arrow
This Country
space
Jeffrey Simpson arrow
The Nation
space
Margaret Wente arrow
Counterpoint
space
Hugh Winsor  arrow
The Power Game
space
 Business


Rob Carrick arrow
Personal Finance
space
Drew Fagan arrow
The Big Picture
space
Mathew Ingram arrow
space
Brent Jang arrow
Business West
space
Brian Milner arrow
Taking Stock
space
Eric Reguly arrow
To The Point
space
Andrew Willis arrow
Streetwise
space
 Sports


Stephen Brunt arrow
The Game
space
Eric Duhatschek arrow
space
Allan Maki arrow
space
William Houston arrow
Truth & Rumours
space
Lorne Rubenstein arrow
Golf
space
 The Arts


John Doyle arrow
Television
space
John MacLachlan Gray arrow
Gray's Anatomy
space
David Macfarlane arrow
Cheap Seats
space
Johanna Schneller arrow
Moviegoer
space
 Comment


Murray Campbell arrow
Ontario Politics
space
Lysiane Gagnon arrow
Inside Quebec
space
Marcus Gee arrow
The World
space
William Johnson arrow
Pit Bill
space
Paul Knox arrow
Worldbeat
space
Heather Mallick arrow
As If
space
Leah McLaren arrow
Generation Why
space
Rex Murphy arrow
Japes of Wrath
space
Rick Salutin arrow
On The Other Hand
space
Paul Sullivan arrow
The West
space
William Thorsell arrow
space





Home | Business | National | Int'l | Sports | Columnists | The Arts | Tech | Travel | TV | Wheels
space

© 2003 Bell Globemedia Interactive Inc. All Rights Reserved.
Help & Contact Us | Back to the top of this page