Monster revenue down 31 percent, layoffs
Monster Worldwide, Inc. reported that total revenue declined 31 percent to $254 million, compared with $366 million in the same quarter of 2008.
Monster generated 43 percent of its revenue outside the United States and total revenue was negatively impacted by $27 million from unfavorable foreign exchange rates.
During the Q1 earnings call, Timothy Yates, Monster’s CFO, also broke down recent layoffs.
“Excluding Monster’s ChinaHR subsidiary, we ended the first quarter with almost 400 fewer associates compared with the fourth quarter of 2008,” Yates said. “We also reduced headcount in China by nearly 300 full time associates and a significant number of temporary employees during the first quarter. As a result, total headcount declined 10 percent.”
Other cutbacks include “merit increases, 401K contributions, and cash incentive compensation,” all of which have been frozen according to the company’s CEO Sal Iannuzzi.
Iannuzzi told Reuters that he was encouraged that demand may be stabilizing, which might mean a rebound in sales. “If the situation deteriorates, we are prepared to take more reductions in the company. It would involve people,” he said. “We are extremely resistant to that.”
Monster names new EVP, general counsel
Monster Worldwide has promoted Michael C. Miller as EVP general counsel and secretary.
Miller joined the company in October 2007 as VP and deputy general counsel. In February 2007, Monster’s fired chief counsel Mryon F. Olesnyckyj pleaded guilty to charges that he conspired in a scheme to backdate stock options granted to the company’s officers, directors and employees, including himself. He later testified against Andrew McKelvey in the U.S. government’s case against the former chairman. McKelvey, who was terminally ill, was granted deferred prosecution. A class-action lawsuit against the former execs was settled this past November. McKelvey died last month.
Miller’s promotion should put the scandal to rest for the company’s new executive team. He reports directly to Sal Iannuzzi, chairman, president and CEO of Monster Worldwide.
“Michael has provided Monster with outstanding legal leadership as an advisor, advocate and valued partner with the business team during this challenging period in Monster’s history,” Iannuzzi said in a company statement. “We look forward to his continued contributions both as a business and legal leader as Monster executes against its mission to be the complete life improvement destination.”
Miller has legal experience in both corporations and private practice. Prior to joining Monster, he served in various capacities as counsel for both Motorola and Symbol Technologies. Before that, he spent six years in private practice at large global law firms in New York.
He received his juris doctor from Hofstra University School of Law in Hempstead, New York, where he served as an associate editor of the Hofstra Law Review. He also holds an M.B.A from Long Island University and a bachelor’s degree from the College of the Holy Cross in Worcester, Mass.
Monster founder McKelvey dead at 74
Andrew J. McKelvey, who bought The Monster Board and Online Career Center Web sites and turned them into the international recruitment powerhouse Monster.com / Monster Worldwide, has died at 74.
McKelvey was battling pancreatic cancer; he was allowed to settle a criminal prosecution earlier this year without conviction because of his ill health.
McKelvey started a yellow pages advertising business, Telephone Marketing Program, in 1967. It grew internationally and became known as TMP Worldwide. In 1995, McKelvey acquired both OCC and Monster Board for TMP. He and Monster Board founder Jeff Taylor later merged them into Monster.com. Until 2006, McKelvey owned a controlling interest in the company, which became known as Monster Worldwide in 2003. He gave up control and sold his stock after allegations he backdated stock options improperly.
Through the McKelvey Foundation and other charitable endeavors, he funded a number of educational institutions and scholarships to poor youngsters, especially in the field of entrepreneurship.
“Entrepreneurs take advantage of what many people don’t even have the vision to realize or the dedication to pursue,” he’s quoted on the foundation’s Web site. “From education, to the arts, to the business world, entrepreneurs have greatly impacted the world in a variety of ways throughout history. Many have built empires from scratch. Others have risked much in pursuit of a dream. All have managed to dramatically change both their own lives – and ours. Whatever it is, it’s made you realize just how possible the impossible may actually be. All you need is the right mind-set and what I feel is the secret to success: timing.”
More about McKelvey in this Associated Press obit.
Monster backdating lawsuit deal approved
Monster Worldwide, parent company of Monster.com and all of its iterations and corporate cousins (Tickle.com, Military.com, Fastweb.com et al), is just about finished with a multimillion-dollar shareholders’ lawsuit over improper stock options. All it has to do is write the check, if it hasn’t already.
The company earlier said it expected the $47.5 million settlement to cost it about $25 million. The amount of the company’s payment was reduced by insurance and by a $550,000 personal payment from founder Andy McKelvey, who was one of two individual defendants in the class-action lawsuit. McKelvey has admitted wrongdoing regarding the stock options; he was granted a “deferred prosecution” agreement in a related criminal case, due to ill health.
U.S. District Judge Jed S. Rakoff ruled this week that the settlement, reached earlier, is “fair, reasonable and adequate,” Dow Jones Newswires reported.
Former Monster Worldwide president and COO Jim Treacy was indicted in April on charges of securities fraud and conspiracy. He has denied wrongdoing. Myron Olesnyckyj, the company’s former counsel, pleaded guilty to criminal charges in the case last year and agreed to cooperate in prosecution of Treacy and McKelvey.
Monster Worldwide is traded on NYSE as MWW.
Monster moves to NYSE
Monster Worldwide has moved to the New York Stock Exchange (NYSE) from its previous home on NASDAQ. It’s the fifth company to make the move in 2008.
Monster’s new ticker symbol is MWW.
New Monster.com will be an ‘almost 100%’ rebuild, Iannuzzi says
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