Yellow Media says it will keep its Canpages online phone directory business but streamline its print operations and cut jobs as it continues to focus on Internet services.
Canadian Press had previously reported that Canpages would be shuttered.
“From an online and mobile perspective, the Canpages brand will continue to exist,” Anne-Sophie Roy, with Yellow Media’s investor relations department, said in an interview Wednesday.
Roy wouldn’t say how many jobs will be lost or which of the city directories Canpages publishes across Canada will be eliminated as the Montreal company’s Yellow Pages directory becomes its dominant print directory.
Like many companies in the communications and publishing sector, Yellow Pages is getting hit hard by changes in consumer behaviour as Internet services dominate the information world.
Fewer Canadians are opening up traditional print phone books to look up numbers and advertising revenues that underpin that industry are increasingly harder to generate.
At Yellow Pages, some Canpages employees are getting employment offers whenever there isn’t duplication, Roy said.
“We believe this concentrated effort will provide better value and better advice for the advertiser.”
She wouldn’t say how many employees are at Canpages, but added there are fewer than the 700 employed when Yellow Media bought the Vancouver-based company in 2010.
Roy said there were some markets where Yellow Media published print directories from both Yellow Pages and Canpages.
“So you’re going to receive only one book at your doorstep,” she said, adding that will be the company’s flagship Yellow Pages directory.
“It’s realigning our cost structure with the reality of our new digital business model.”
Yellow Media has said its online revenues represented more than 27% of total revenues in its third quarter in 2011, compared to 20 per cent in the same period in 2010.
Roy said Canpages.ca will still be a local commercial search site but it’s going to be relaunched with a different user experience.
Yellow Media bought Canpages for about $225 million two years ago in a move to expand its online phone directory business.
Canpages publishes traditional phone directories in Ontario, British Columbia, Quebec, Alberta, Yukon, and the Northwest Territories.
Yellow Media has been struggling as it tries to reposition itself primarily as an Internet company.
The publisher of the Yellow Pages print and online directories logged a $2.9-billion writedown to the value of its business at the end of last September. The company stopped paying dividends last year to improve its financial position.
Last year Yellow Media sold Trader Corp., home of AutoTrader magazine, to London-based private equity firm Apax Partners for $745 million to help reduce its debt.
Canaccord Genuity analyst Aravinda Galappatthige said it makes sense that Yellow Media would keep the digital side of Canpages.
“My understanding is that when they acquired it, online was about 23 per cent of revenues and that was more than two years ago,” Galappatthige said from Toronto.
“So it’s very likely that number would have gone up into the 30s. Perhaps they can take out the print and maintain the online,” he said of the Canpages division. “My understanding is that Canpages was making money, maybe not a lot of money but it wasn’t bleeding cash.”
