Departing Penton CEO to Get $2.4 Million

By Staff -- Tradeshow Week, 5/24/2004

While reporting flat revenue and a wider first-quarter net loss, Penton Media announced that it will pay departing CEO Tom Kemp $2.4 million in severance in 2004, an amount nearly equivalent to a year's salary.

In its quarterly federal filing, the company warned that the exact amount of the severance could change, since an agreement is still being negotiated. In the meantime, a national search is on for a replacement for Kemp, who steered Penton through eight years of boom and recession. Kemp announced in late March that he would step down from his $2.3-million-a-year position. He has agreed to stay on during the transition.

The company reported stabilization in some markets. Overall first-quarter revenue of $54.5 million was slightly higher than the $54.4 million reported in the first quarter of 2003. Penton's net loss rose to $5.2 million, from $5.1 million in the year-ago quarter.

The company's tradeshow revenue increased to $16.1 million, a 10.6-percent gain over the $14.6 million reported in the first quarter of last year, boosted largely by a strong showing at Natural Products Expo West. Revenue from online media rose to $3.8 million from $3.1 million in the year-ago period, while publishing revenue dropped to $34.5 million, from $36.8 million in the first three months of 2003.

The company also revealed that it paid $700,000 severance during the first quarter associated with the layoff of 21 more employees. It expects to pay an additional $3.4 million for severance, lease obligations and other restructuring activities this year, not including Kemp's package. Penton has laid off more than 700 employees and shuttered 30 offices in recent years.

The company still has $31 million cash and access to $40 million credit. Its biggest expenditure in 2004 will be $37 million in interest on $329 million debt. In its quarterly filing, Penton management estimated the company has enough cash to sustain operations through next March.