Bob Pittman (pictured), Chairman and Chief Executive Officer of US radio giant iHeartMedia, which operates over 850 stations across the country, won’t be taking a salary for the rest of the year as a cost cutting measure amidst the Coronavirus crisis.
iHeart’s President, Chief Operating Officer and Chief Financial Officer Rich Bressler will also be taking a reduced salary for the remainder of 2020.
In addition, the company has furloughed an undisclosed number of employees with no pay for 90 days, according to a memo sent to the company’s employees, which was first reported by radio trade publication RAMP.
According to iHeartMedia SEC filings reviewed by MBW, Pittman now receives a base salary of $1,500,000 per year since signing a new deal effective from May 2019.
Pittman can also earn an annual bonus this year of $3,400,000 dependent on “the achievement of reasonable performance goals set in good faith”.
Bressler is on the exact same deal: $1.5m base salary with $3.4m potential annual bonus.
iHeart’s COVID-19-related memo states that Bressler and Pittman have “never had to make more difficult decisions,” and that “while it is an unpaid leave of absence, the affected employees stay in our employ, allowing us to continue offering these employees full health benefits, and we want to make sure we take care of them as best we can during this time”.
The news of the furloughs follows last week’s announcement that iHeart is withdrawing its full-year 2020 financial guidance provided on its Q4 earnings call on February 27, 2020 due to “heightened uncertainty” related to the pandemic.
“While we cannot determine the full extent of COVID-19’s impact on our business at this time, we are monitoring this rapidly evolving situation closely and look forward to discussing our business in greater detail as part of our first quarter 2020 earnings results investor call.”
Bob Pittman, iHeart
Bob Pittman, iHeart’s Chairman and Chief Executive Officer, said: “Given the ongoing uncertainty surrounding the duration and magnitude of the COVID-19 pandemic and its impact on the U.S. economy, we believe it is appropriate to withdraw our full-year 2020 guidance.
“While we cannot determine the full extent of COVID-19’s impact on our business at this time, we are monitoring this rapidly evolving situation closely and look forward to discussing our business in greater detail as part of our first quarter 2020 earnings results investor call.
“At iHeartMedia, our listeners rely on us as a trusted voice for companionship and calm and as a source for critically important information, especially during times of crisis and need, and we remain fully committed to fulfilling this mission.”
“The challenges that COVID-19 has created for advertisers and consumers has impacted iHeart’s revenue in recent weeks, creating a less clear business outlook in the near term.”
Rich Bressler, iHeart
Rich Bressler, iHeart’s President, Chief Operating Officer and Chief Financial Officer, added: “iHeartMedia had a strong January and February before the effects of COVID-19 began to unfold into a global pandemic in early March.
“The challenges that COVID-19 has created for advertisers and consumers has impacted iHeart’s revenue in recent weeks, creating a less clear business outlook in the near term.
“To maintain maximum financial flexibility during this period, we have drawn $350 million on our $450 million senior secured asset-based revolving credit facility (“ABL Facility”).
“We believe that the additional funds from drawing on our ABL Facility, in combination with our cash balance, provides us with a prudent level of liquidity at this time. We fully appreciate the unprecedented challenges posed by this crisis, however, we remain confident in our business, our employees and our strategy.
“With our experienced management team and our leadership position in the audio sector, we are committed to navigating this period while serving our audiences and other constituents.”Music Business Worldwide
