World Wrestling Entertainment may have gotten a win this week when the state of Florida deemed its matches in Orlando “essential services,” but the company said Wednesday it is implementing a range of COVID-19 cutbacks.
A combination of employee furloughs and pay cuts for board members and executives pay cuts are expected to generate cost savings of $4 million a month. The furloughs are expected to be temporary, but the company did not provide specific numbers in terms of affected employees. Talent expenses, third-party staffing and consulting fees are also included in the austerity mix.
The moves are expected to boost cash flow by $40 million. WWE will report quarterly earnings on April 23.
“Due to COVID-19 and current government mandated impacts on WWE and the media business generally, the company went through an extensive evaluation of its operations over the past several weeks,” a press release said. “This analysis resulted in the implementation of various short-term cost reductions and cash flow improvement actions.”
Like most media companies, Stamford, CT-based WWE has taken a significant hit during the current climate, with its shares dropping more than 40% in 2020 to date. Even before the coronavirus sent the economy reeling and dramatically altered the landscape of entertainment and live sports, however, the company had hit some rough patches.
The company is a large stakeholder in the XFL, the new-model football league shepherded by WWE chief Vince McMahon. The XFL declared bankruptcy this month in the wake of the coronavirus wiping out the league’s debut season. In January, the co-presidents of the company abruptly departed, shortly before a disappointing quarterly earnings report.
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