Circle Media Group

Reaction from Circle Media Group to call from Trade Unions

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Circle Media Group (CMG) today learned through the media about a call from several trade unions calling for a ’mobilisation of European workers’. CMG of course recognises the right of employees to organise themselves. However, the arguments used in this call are unfounded, unsubstantiated and harmful to our businesses, our employees and our management.

Circle Media Group operates in very challenging circumstances, but we conduct our business in a correct and straightforward way. We recognize that some of the measures we were forced to take, given the huge challenges the European printing industry is facing, can be experienced as painful. But not intervening is not an option either. We share the same concerns about the future of the printing industry and therefore count on the trade unions’ understanding and readiness to dialogue.

As is well-known to the unions, the whole European printing industry has seen difficult market circumstances for a long time and has been continuously restructuring itself for many years in order to survive and to protect businesses, including labour where possible. This situation is the result of a continuous decrease in print volumes, resulting in structural overcapacity and cut-throat competition, leading to ongoing reorganisations, closures and bankruptcies throughout Europe. This process has accelerated during 2018 because of reduced paper availability, leading to rapidly increasing paper prices that could not be passed on to customers and a stronger market decline than in previous years.

Circle Media Group is subject to these same market circumstances and wants to stand firm in this environment, constantly needing to take measures to lower costs and operate more efficiently for our long-term survival. For this reason we also continue our strategy of further consolidating the European printing industry in a responsible way in order to build a sustainable future for print. This includes investing in companies to consolidate the market, as well as reducing capacity where necessary. Though we cannot disclose details for competitive reasons, we can confirm that no cash from operating companies was used for our recent acquisitions, contrary to what the unions claim.

In addition, it is also important to know that the Group operates within strict divisional boundaries, whereby each (geographical) division is responsible for its own cash management and financing, and needs to stay healthy or restructure within the resources available.

We understand that the insolvency of Helio Charleroi and the dismissal of employees have created grief for the employees involved and anxiety in other companies. But Helio was supported by the Group over the past years with several millions of funding to cover its losses. Unfortunately, we were not able to keep operating this production location. Belgian labour laws made any other solution than insolvency unachievable.

We have always complied with the Law, followed our disclosure and reporting obligations, funded our business in the best possible manner and have fulfilled our duties towards our employees. Where capacity was reduced and redundancies were unavoidable, we have acted in a responsible manner according to local regulations. Therefore these unfounded accusations can put our business, the relations with our stakeholders and the jobs of our employees further in danger under the current difficult market circumstances in the printing industry.