Two recent stories highlight that it’s tough times for old-school New Zealand travel publishers. The most notable concerns Jasons Travel Media, a well-known publisher of travel and accommodation guides, which was placed into receivership in late November.
All its assets and intellectual property (including the brand) were bought last Monday by another NZ publisher, Bennetts Group, while the company, founded in 1967, is suspended from the NZ stock exchange for missing another reporting obligation. The shell that remains has been renamed Snosaj12, like a character out of an Arthur C. Clarke sci-fi novel.
Bennetts says “Jasons will continue to trade as a going concern, protecting the interests of tourism industry operators, customers and other stakeholders.
The deal includes 62 magazine publications, the Jasons websites, and more than 4,000 distribution points”. No price was disclosed or staffing discussed.
The Jasons corporate demise had been coming for a long time – years.
Like so many publishers, it was unable to to adapt its business model to the internet.
Jasons was also badly run. Mistakes include poorly-executed expansion into the larger, tougher Australian market.
And there’s lots more.
A presentation by company founder and Chairman John Sandford gave at the company’s Annual General Meeting in September showed showed the company’s problems ran deep.
“FY13: A particularly difficult year
- Tourism market depressed with motel sector a very poor performer
- Revenue dropped significantly and with inadequate cost control leading to EBITDA loss of NZD1.238m
- Inadequate debtor management
- Breach of banking covenants at financial year-end
- Down-scaling of Australian operations (which were causing the company much grief)
- Exit of Chief Executive
- Re-establish CFO role”
At that point he forecast a pre-tax profit above NZD500,000 for FY14, however that turned out to be wishful thinking. Jasons imploded just two months later
The Jasons collapse more or less coincided with news that another NZ company, Club Tourism Publishing, was pulling out of its Australian JV, AAA Tourism.
“The decision to dissolve the joint venture partnership is a reflection of the rapid expansion of digital media channels in the Australian travel and tourism sector and declining print advertising revenues for accommodation guide books,” said Moira Penman, CEO of Club Tourism Publishing.
“While CTP produces high quality guides in Australia, revenue results have not met expectations as accommodation operators reduce marketing budgets to fund commission based online distribution channels.
She said that CTP New Zealand operations remain strong.
But for how long? Australia may have been the wrong move but the internet is not an option, it is here forever.