ABS-CBN CEO: We may start retrenchment by August sans franchise
MANILA, Philippine — ABS-CBN might start retrenching employees by August if it fails to get a new or provisional franchise.
ABS-CBN president and chief executive officer Carlo Katigbak revealed this during Tuesday’s hearing of the Senate committee on public services.
Katigbak said that he made a commitment to the company’s 11,000 workers that their jobs will be safe for at least three months.
“Your honor, when we’re taken off the air on May 5th, we made our commitment to our employees given the difficult economic situation following COVID-19, we made a commitment to them that we would not take away any jobs for three months,” Katigbak said.
However, Katigbak said that the management “cannot make that commitment open-ended” because it is also beset by financial constraints.
“We continue to lose a substantial amount of money every month your honor, and I’m afraid that if we can’t get back on air soon, by August we may already have to consider beginning a retrenchment process your honor,” he said.
ABS-CBN was forced to stop its operations last May 5 in compliance with the National Telecommunications Commission’s (NTC) order as the network’s franchise expired last May 4.
Even after the shutdown though, Katigbak said their employees continued to receive their salaries since the management knows it would be very difficult for them to find another job while the country is battling the coronavirus pandemic.
“And we felt it would be very, very painful to put our employees out on the street without them having an idea as to how they could continue earning a living and continue to feed their families,” he said.
But if Congress would grant them a new franchise, even a five month provisional permit, Katigbak said ABS-CBN would be able to resume operations immediately.
Facing bankruptcy
Analysts earlier warned that ABS-CBN is facing bankruptcy if it is not allowed to again resume television and radio broadcasts, which deliver most of its earnings. Apart from ongoing expenses such as payroll, ABS-CBN has over P21 billion in long-term debt.
There are 11 bills seeking to renew ABS-CBN’s franchise pending before the House of Representatives. Efforts for its renewal have languished for years in Congress, while President Rodrigo Duterte threatened to shut the network down.
ABS-CBN said in a filing to the Supreme Court that it was losing up to P35 million per day from its loss of its traditional broadcasting business.
JPV/EDV
