As I See It
King inherits Highfield’s tarnished crown
Whatever they are, those left behind at JP HQ now have to pick up the baton and hope there is enough energy left in the owner of The Scotsman to stay in a competitive media race.
Highfield’s optimistic ‘jam tomorrow’ messages were always greeted with a few raised eyebrows and the odd rebellion among investors as losses mounted and the share price plummeted.
Staff resented the constant job cuts and pleas for spending restraints while seeing their CEO amply rewarded. Highfield was paid £808,000 in 2017, including an annual bonus of £249,000 and pension contributions of £115,000, a total remuneration rise of 45% on the previous year when the company reported a £300m loss. After his resignation was announced the shares rose 16%.
He arrived at JP in 2011 with a reputation for developing digital strategies at the BBC and, in fairness, this has begun to bear some fruit in recent months, with growth in traffic and revenue.
With the digital plan making progress, its purchase of the ‘i’ newspaper in 2016 was seen as an inexplicable investment in print at a time when titles were closing.
To a degree, Highfield has been vindicated and has used regular trading updates to hail rises in circulation and revenue of the Independent’s cast-off.
Unfortunately the group has come to rely on these successes to cover up weaknesses elsewhere and he has been unable to make big enough in-roads into the debt pile.
The board insists it is confident that it will meet its obligations until its bonds need to be repaid in June next year. The auditors, however, were sufficiently worried by ongoing balance sheet pressures that they warned in the annual report of the group’s ability to continue as a going concern.
No surprise, then, that the directors knew they had to move quickly to install a new CEO to ensure stability. Not only that, but by choosing CFO David King they have someone who is fully up to speed with the group’s circumstances.
He now needs to hit the ground running, rebuild a demoralised workforce, and prove he hasn’t inherited a poisoned chalice.