NZ Herald reports that Bauer has closed its NZ magazine business permanently.
New Zealand’s biggest newstand magazines have been folded, as Bauer Media NZ abruptly closes its doors permanently as a result of the Covid 19 crisis.
The New Zealand wing of the German-owned company publishes a range of New Zealand magazines including Woman’s Day, New Zealand Woman’s Weekly, The Australian Women’s Weekly, the Listener, North & South, Next, Metro, Kia Ora, Home NZ and Your Home & Garden.
The closure brings to an end many decades of publishing in New Zealand, with around 300 staff out of jobs.
A staffer spoken to by the Herald said they were “devastated” and “didn’t see it coming”.
This move is a shock.
Get ready for more shocks. COVID19 will bring forward many decisions that were not too far around the corner anyway. Think the Age, Australian, magazines in Aust, David Jones and Myer, Kmart and Target. Many businesses were hanging on by a thread in a relatively healthy economy, let alone the mess we have now.
Yep, I agree with Peter.
I wouldn’t be surprised to see the same decision made here. More will go if/as the virus gets worse. Watch what happens when newsagents get closed down (have been told from a very good source it will happen at a particular level) and how many shut for good as a result.
This will change the Australian retail landscape in ways many had not considered in the short to medium term.
Peter and Paul,
Yes unfortunately it is the case of what is mentioned by both of you and more. Ovato is seeking Bank assistance yet it shows a consistent earnings decline average of 47.07% per annum over the past 5 years its Debt equity ratio is has increased from 19.8%.to 154% over 5 years.
It has a negative Return on Equity of (-191.38% as it is currently unprofitable. I would think the Ban would demand a capital injection (where from?) and Peter my concern is your statement of which I agree will happen “when newsagents “get” closed down” (or choose to do so, I add) we are still getting many enquiries however action is slower. I believe all business, every different kind will be affected. None will escape this with sustainable income except Pharmacies and Medical Services.
Mark is Bauer Media Australia in a stronger position to NZ ?
Should newsagents in Australia who still do well from magazines be concerned?
Thank you
Hi TraceyAnn
I don’t have any unique knowledge. That said, my opinion is that the Bauer business in Australia is substantial enough to have a good future, regardless of the actual owner. However, I don’t know their ad revenue model and its importance on their P&L.
In NZ, several factors played into the decision I suspect – the classification of magazines as non essential, market size and the collapse of ad revenue.
With Bauer being privately owned, the future is at the whim of the family and it is hard to understand pressures elsewhere that could play into the decisions they make.
The bigger challenge for newsagents is Ovato. As they are a public company we have a better sense of their challenges.