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FR
Fabrice Lacroix

Fabrice Lacroix

Managing Director

« AFP is still running up against a financial brick wall. »

What do you remember most from the past year, which has seen the new company agreement, a commercial relaunch and new projects coming to life?

All of those things helped to improve the way the company functions but for me, the most pivotal element was the signing of the company agreement. The implementation of this agreement and the entry into force of a new way of organising our work have had a critical impact on how the Agency functions, especially thanks to the introduction of a set number of working days per year for journalists and staff. In terms of reducing our payroll costs and salary scales, we will only see the savings from these reforms in a few years, as our company age pyramid gets younger. However, we have seen an immediate effect in terms of working time.

To what extent has this effect already materialised?

Has this really helped to reduce our costs? We have again had a tough year in terms of revenue but the good news is that our turnover has stopped falling. Our commercial relaunch plan and drive to find new clients have enabled us to reverse the trend. Despite that, we are still short of our budgetary objective. We have filled this small gap by controlling our costs, mainly payroll costs. A certain number of jobs have been frozen or delayed and we have made limited use of temporary staff. The fact that everyone individually is working a bit more helps to make this bearable.

Has this really helped to reduce our costs?

L’année a encore été difficile pour les recettes mais la bonne nouvelle, c’est l’arrêt de la baisse du chiffre d’affaires. Le plan de relance commercial et les efforts de prospection ont permis d’inverser la courbe. Malgré cela, nous restons en tension par rapport à notre objectif budgétaire. Ce petit écart a été compensé par la maîtrise de nos charges, essentiellement salariales, un certain nombre de postes ayant été gelés ou décalés dans le temps, et le recours aux CDD limité. Le fait que nous travaillions un peu plus individuellement contribue à rendre cela supportable.

What conclusions do you draw from this contrasting situation?

Once we had carried out these fundamental reforms, we started to examine the state of our economic model. After three years of losses, and despite maintaining a better turnover performance than many of our competitors, this is becoming a critical question. While the whole company is making efforts and trying to transform itself -- by means of social negotiations and teamwork -- things are still a bit tight in terms of our ability to free up resources. We are struggling to finance additional investments and to have enough cash available to operate more comfortably. In short, we are still running up against a financial brick wall.

Is the Agency's economic model in question?

Partly, if one considers the efforts that we are making, the quality of our editorial production and the commitment of our staff. We have a relatively small deficit on a turnover of some 300 million euros. But this deficit comes at a time when our cashflow is in a difficult situation, which restricts our development and innovation. If we want to regain momentum, we need to put a bit more petrol into the tank and give this company the resources it needs to develop in the future along the strategic axes that have long been identified: international, video, corporate and sport.

How do you intend to achieve this?

Emmanuel Hoog has told the French government there is a financing need of around 60 million euros over several years. We are in discussions with the government, which is examining our request. It is about enabling the Agency to compete on the world stage and win back some market share from our competitors. This financing, which goes beyond what we receive for our general interest mission, would be to support our development whereas today we are constrained in this respect by a lack of resources and cash flow. It would allow us to make productivity gains and invest in the future, as well as help us to make our financial structure more healthy. In financial terms, our debt is rather low but we lack the room for manoeuvre to pay it back.

How precisely would this financial support be allocated?

This 60-million-euro package would be divided into three parts. An initial third would go towards productivity gains at all levels in order to reduce our operating costs. If we could invest in our processes and operations, we would be able to reduce our costs. The second tranche would go towards debt reduction and the third towards investments, especially innovation for which we have an abundance of projects in the pipeline.

What are you hoping for in terms of investments?

Our priority is video. After Paris, we have installed a second Master Control Room for live video production in Hong Kong but we need a third one in the US time zone. What could be more natural for an Agency that operates worldwide than to have a 24-hour operation! We need to be able to finance this sort of investment in the near future. We also need to push on with publishing our live broadcasts via internet. To be able to produce more live broadcasts and distribute them very widely via the web is a major advantage, especially in the market we are targeting -- broadcasters with more financial leeway than the traditional written press and which therefore represent an untapped commercial potential. In addition, our editorial platform IRIS, which will be completely rolled out in 2018 after video is integrated into the system, will require permanent maintenance and updating.

Is the government prepared, in your opinion, to make a new contribution for the Agency?

Without wishing to speak for the government, it seems to think that AFP is a well-run company but the debate is more about potential and the wider media industry. What is the Agency's economic and commercial future? At a time everyone is fighting against fake news, including sometimes from state actors, does it make sense to support a European jewel of global news? These are the questions the government -- as the main financial player -- has to try to answer before helping the Agency develop and modernise its model.