Sky TV boss Martin Stewart and other executives are taking a 25 per cent pay cut. The company is also culling the ranks of its contractors, who make up a third of its total workforce. Photo / Jason Oxenham
Sky TV boss Martin Stewart and other executives are taking a 25 per cent pay cut. The company is also culling the ranks of its contractors, who make up a third of its total workforce. Photo / Jason Oxenham
Sky Television chief executive Martin Stewart has joined other executives in taking a 25 per cent pay cut for at least six months.
The pay TV provider's latest annual report lists one employee in its top earning bracket of $1.76 to $1.77 million. Presuming that's Stewart, the cut would workout to around $443,000 on an annualised basis.
Unlike at several major media companies, rank-and-file staff have not been asked to take a temporary pay cut in the face of potential redundancies at this point.
On the other hand the company's substantial complement of contractors - who make up around a third of its full-time-equivalent staff - is feeling the pinch.
"Most of them are small independent businesses and we've been providing support and information to assist them to apply for Government support, like the wage subsidy. It's a difficult time for our wider sport broadcasting community," Major says.
On March 18, Sky withdrew its 2020 profit guidance, leaving the question of its full-year earnings hanging as the sports calendar was decimated by Covid-19 and film and TV studios worldwide put productions on hold.
The company has not given any subscriber update since, but Major confirms the company has not qualified for the wage subsidy (which has a 30 per cent drop in revenue threshold).
With around 60 per cent of NZ employees covered by $9.9 billion in payouts so far, that puts Sky staff in the minority (or at least the vast bulk of its permanent staff. Around 35 in its outside broadcast and pub quiz subsidiaries have qualified for the subsidy).
It also makes the company, and its subscription-heavy revenue, stand out from other major media operators who have qualified for millions in wage subsidies as advertising craters. Sky's satellite and streaming businesses delivered $385m during the six months to December 31, 2019 to advertising's $26m - although Stewart has qualified that advertising is a high-profit niche.
Sky TV boss Martin Stewart and other executives are taking a 25 per cent pay cut. The company is also culling the ranks of its contractors, who make up a third of its total workforce. Photo / Jason Oxenham
"With the core Sky business not currently eligible for the wage subsidy, it's a difficult balance," Major says. "We are asking large numbers of team members to take annual leave."
Sky shares, which were at 73 cents in the New Year, fell to an all-time low closing-price of 19c on March 23, but in recent days have regained some ground. The stock was recently trading at 32c.
Skytv
The challenges of the live-sport drought, a spiking bond yield and a discounted share issue anticipated by analysts have been offset, to a degree, by interest from Black Crane Capital.
An April 13 filing revealed the Hong Kong-based boutique investor has built a 5.1 per cent stake in Sky on the expectation the media group will emerge as a key content aggregator.
Ken Smith joins Sky's board
Professional director Keith Smith has been appointed to Sky's board to fill a casual vacancy.
He will seek election from Sky's shareholders at Sky's next annual meeting.
Smith - a past president of the Chartered Accountants Australia and New Zealand - currently chairs of listed company Goodman, the Manager of Goodman Property Trust. He is also deputy chairman of The Warehouse Group and a director of Mercury NZ Limited and several other private companies.
