‘Fairly big decisions’ are forthcoming for Torstar, new CEO says

TORONTO – The new CEO of Torstar said Wednesday “everything is on the table” in his plans to transform the media giant to overcome ongoing declines in print advertising revenue.

Major changes are in store to better determine which consumers the company wants to serve and what assets best address their needs, said John Boynton, who took over as the company’s CEO and publisher of the Toronto Star at the end of March.

“We won’t be rounding at the edges,” Boynton said in an interview after the company’s annual general meeting.

“We’ll be making some fairly big decisions.”

Torstar (TSX:TS.B) will take at least three months to determine its target demographic, Boynton said, stressing the importance of not making any rash decisions.

“These things take time,” he said. “When companies rush them, they make bad decisions they regret.”

The road ahead will involve trial and error, though Torstar’s debt-free status gives it a “huge advantage” compared to its competitors, he added.

Torstar has experimented with a number of measures in recent years to adapt to an evolving media landscape, including a pay wall that was later taken down and Star Touch, a digital app intended to appeal to a younger audience. Despite investing more than $20 million into Star Touch, it has failed to meet management expectations since its launch in September 2015.

“The product was a really interesting format that was highly engaging with consumers that was delivered specifically on a tablet,” Boynton said.

“What I’m talking about … is something much more fundamental than that.”

Boynton’s comments came as Torstar reported a $24.4 million loss for its first quarter ended March 31, an improvement from last year when the comparable losses were more than twice as big.

Its shares fell more than 10 per cent in midday trading, down 17 cents to $1.49.

The company said cost reductions will remain an important area of focus. It expects $5.3 million in annualized savings from 110 previously announced job cuts during the quarter.

Restructuring measures already undertaken in the first quarter are expected to result in net savings of $13 million for the balance of the year, chief financial officer Lorenzo DeMarchi said in a conference call with analysts earlier in the day.

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Torstar holds an investment in The Canadian Press as part of a joint agreement with a subsidiary of the Globe and Mail and the parent company of Montreal’s La Presse.

Note to readers: This is a corrected story. A previous version said Torstar was to cut 110 positions.