Westwood One names latest chief executive

October 20, 2008

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Westwood One names latest chief executive

By Matthew Flamm

Published: October 20, 2008 - 2:45 pm

Troubled radio network Westwood One, which provides traffic reports and syndicated shows like Larry King Live to thousands of stations, just got a new top executive, barely 10 months after the appointment of its previous one.

Rod Sherwood, who was named chief financial officer last month, has taken on the title of president, the company announced Monday. Magazine industry veteran Tom Beusse, who became president and chief executive officer in January, has resigned.

The announcement of the management changes did nothing to move Westwood One’s stock price, which has fallen 90% since the start of the year. It was trading Monday afternoon at 19 cents a share.

Pounded by competition from the Internet and other radio companies, as well as a weak advertising marketplace, Westwood One is in danger of being de-listed by the New York Stock Exchange.

“It’s been a company in disarray for some time,” said Robert Unmacht of iN3 Partners, a media consulting firm. He points to competition from Clear Channel’s Total Traffic Network and from Premiere Radio Networks, which also syndicates programming.

Prior to joining Westwood One in September, Mr. Sherwood had been CFO at the Gores Group. Earlier this year, an affiliate, Gores Radio Holdings, became a major investor in Westwood One when it agreed to buy $100 million worth of stock.

Westwood One recently completed an investor road show aimed at highlighting a reorganized Metro Reports division that’s expected to result in $35 million in savings. Though the company says that the reorganization and other changes will begin to provide traction next year, observers are skeptical.

“The company has had 10% negative sales growth for the last two years,” said Daniello Natoli, a managing director of Matrix USA and one of the few analysts still covering Westwood One. “Looking at the radio sector in general, there are too many other sources of entertainment.”

Revenue for Westwood One fell 10% in the second quarter to $100 million. Operating income fell 37% to $10.4 million, not including a $206 million non-cash goodwill impairment charge.

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