The Irish Times Ltd, the publisher of The Irish Times, is to seek annualised cost savings of €4.5 million by the end of the year.
The company said yesterday that the reduction was required as part of a process of good management aimed at building on the success of recent years and positioning it for further development.
The company plans to reduce costs through a mixture of cuts in payroll and non-payroll expenditure. A voluntary redundancy package will be introduced with the aim of reducing staff numbers by the financial equivalent of 35 to 40 people.
Organisational changes and the terms of the redundancy package will be the subject of negotiations with trade unions. All departments of the newspaper will be affected. In a statement following a briefing with the Dublin Printing Group of Unions (DPGU), the company said that profit for 2004 would be ahead of the €8.5 million recorded for 2003.
However, it said, rising employment costs had consumed 50 per cent of the cost savings of around €8 million a year achieved in a major restructuring in 2002.
The company said it planned to act prudently now - when it was performing well editorially and commercially - to ensure there was no repeat of the financial crisis that threatened its viability three years ago.
It was operating in one of the most competitive newspaper markets, it added, where competitors had changed the ground rules in recent times, reducing costs by "forcing through the outsourcing of key functions and enhancing or outsourcing print facilities".
"We are responding by adopting a dual strategy to combine investment and development with rigorous cost management," the statement said.
Séamus Dooley, the Irish Organiser of the National Union of Journalists - and a member of the DPGU - said the group "at this stage no way accepted the need for redundancies, but we accept that the decision of a major competitor to enforce redundancies has altered the business environment. We would be very cautious about viewing staff reductions as the source of competitiveness".
The Irish Times said the savings were being sought as part of a benchmarking process "to assess efficiency" that will be conducted against "modern comparable companies".
It said the changes were needed to capitalise on the opportunities afforded by its move to new offices at Liffey House in Dublin at the end of the year and the €12.5 million expansion of the company's printing plant at Citywest.
As part of its development programme, the company pointed out that it had also invested recently in the publication of international editions of the newspaper in London and Spain.
