Maariv's board of directors decided Thursday evening to establish a search committee to replace CEO Ofer Nimrodi - despite Nimrodi's objections, TheMarker has learned. The move came as Maariv released poor second quarter financial results, after the stock market closed Thursday evening.
Nimrodi had started to search for a successor a few months ago, but had not found one. Now the task will be passed on to the committee.
His is not the only senior post open at Maariv. Since talks collapsed over the sale of the troubled newspaper to Sheldon Adelson, Editor Amnon Dankner has resigned, as has senior columnist Dan Margalit. Two deputy CEOs quit as well, along with the editor of Maariv's NRG Web site. No replacement has been found for any of them yet.
The board also approved the second quarter financial reports at its meeting. The numbers showed a 12-percent drop in revenues compared to the parallel quarter of 2006, and an operating loss of NIS 19.6 million, as well as a net loss of NIS 19.2 million. Revenues dropped to NIS 117.8 million for the quarter.
So far for 2007, the company has operating losses of NIS 30 million, and has eaten up almost 10 percent of the firm's equity. The loss over the last six months is almost equal to Maariv's losses for all of 2006 - NIS 31 million.
Maariv's figures deteriorated across the board over the quarter, as the paper continues to burn cash with a negative cash flow from operations of NIS 21.7 million for the quarter, up from NIS 3.7 million for the same period of last year.
As of closing on Thursday, the share had lost 22 percent in 2007 with a market value of NIS 384 million.
The amount of advertising space sold by Maariv has not changed significantly since last year. However, advertising revenues have decreased, according to the reports.
The explanation is that the prices Maariv can charge advertisers have been dropping. One large media buyer said that the amount of space has not dropped because advertisers cannot get all the television time they want, so they buy newspaper space instead.However, Maariv's prices have gone down, and that the paper has no one left to discuss the prices of long-term advertising contracts.