Channel 4 has detailed a number of urgent fiscal measures it is taking to try to offset the economic havoc caused by the Covid-19 outbreak, including furlough for 10% of its staff and a slash in content spend of £150m.
The commercially-funded broadcaster gets most of its revenue from advertising and has been hit by the fact that the TV ad market is set to be down more than 50% for April and May.
The other measures include a reduction in the 2020 content budget of £150m. The channel said it maintain its support for the creative sector – continuing to commission and develop content for 2020 and 2021 – with ringfenced funding for small, nations & regions and BAME-led independent producers.
All executive and non-executive board members have taken an immediate voluntary 20% pay cut and the bonus scheme for executive directors has been suspended.
A further £95m of savings will be achieved across the organisation through a full review of planned projects and investments, including a reduction in marketing budgets.
The statement went on: “In order to provide additional liquidity and working capital through this unprecedented economic period we have drawn down on the commercial £75m revolving credit facility (RCF) that has been in place since 2018.
"We remain focused on safeguarding the jobs and protecting the livelihoods of Channel 4 staff but have undertaken a comprehensive review of our people costs, which will include a full recruitment freeze for all but business critical roles and a review of all third-party costs.
“Additionally, we will participate in the government’s Coronavirus Job Retention Scheme and today we will be opening discussions on furloughing with around 10% of Channel 4 staff, whose roles are impacted by the current circumstances.
“All of these measures will be reviewed regularly given the limited market visibility currently.”
Alex Mahon, Channel 4’s CEO said: “Over the last few weeks Channel 4 has demonstrated the importance of its role as we have helped navigate our audience, particularly young and hard to reach viewers, through these challenging times – with record viewing figures for Channel 4 News including over 200 million views to our news content on social media, and our ‘Stay at Home’ on-screen graphic reaching almost two thirds of the UK population.
“However, as a commercially-funded business the Covid-19 outbreak has had a severe impact on our advertising revenues and so we are taking action now to manage our costs appropriately and ensure that we both protect our staff and our ongoing ability to serve our audience.
“We know that these are exceptionally challenging times for everyone in the UK, particularly many of the producers, talent and freelancers we work with across the television and creative industries and we are committed to safeguarding our long-term ability to invest in distinctive and challenging content and create jobs and opportunities in the sector across the UK.”