EMI to axe 1,500 jobs
Music group EMI today announced that it was cutting 1,500 jobs as part of a shake-up of its manufacturing operations.
The group said it would reduce its headcount by about 900 in the Netherlands and the United States as it moves to contract out production of compact discs and DVDs.
EMI added that it was restructuring some of its record labels and artist roster, particularly in continental Europe.
A spokesman for the group said “a small fraction” of the job cuts would take place at its sites in the UK, but refused to say how many.
EMI said the cuts would come in its recorded music division, which has artists including Radiohead, Coldplay and Robbie Williams in its portfolio.
It said it expected to save at least €74.9m per annum, of which €37m would be delivered in the financial year ending March 31, 2005.
It said it would stop in-house manufacturing of CDs and DVDs in Europe and the US. EMI plans to transfer manufacturing and related assets at its plant in Uden in the Netherlands to Mediamotion, a member of the Dutch ECF Group. Employees at that plant will transfer to Mediamotion.
It added that it planned to close its factory at Jacksonville, Illinois in the US and had told the affected staff.
However, EMI said it intended to maintain its supply, warehousing and distribution operations at both sites.
EMI also said it was reducing its global roster of artists by about 20%, which would affect “largely niche and under-performing artists”.
It said it would refocus efforts and resources on artists with the greatest potential on a global and local level.
The group said it expected the changes to further improve the company’s financial performance while allowing it to maximise opportunities from its rapidly growing digital business.
In a trading update accompanying the announcement, it said full-year sales in recorded music were close to the previous year’s level and the company had put in “a solid performance” in music publishing.
Chairman and chief executive of EMI, Alain Levy, said exiting manufacturing in the group’s two primary regions of Europe and the US would allow it to cut costs while making supply more flexible.
“We believe that by concentrating our efforts on a tightened roster of artists, we will increase our revenue-generating potential while reducing our costs,” he added.
