Janet Robinson, CEO of The New York Times Co., opened her remarks today during a media conference in New York acknowledging the tough upcoming year but reiterated the Ochs/Sulzberger family has no plans to sell the company.
"There is no doubt that 2009 will be among the most challenging years we have faced and more steps will be needed," she said in a statement released about the UBS global media and communications conference. "We believe that through our revenue initiatives, expense cuts and the steps we are taking to improve our financial flexibility, the Times company is well positioned to weather the challenges next year is expected to bring."
What the company doesn't expect is to fully replace the $400 million credit facility that is coming due in May. The company borrowed $400 million under an $800 million facility. The company cut its quarterly dividend by 75 percent freeing up some $100 million in cash and borrowed $225 million against the value of the headquarters building in Manhattan in order to meet the payment.
James Follo, senior vice president and CFO of the company, said: "We have no intention or need of fully replacing the $400 million credit facility expiring next year because our total borrowing under both agreements is projected to be significantly less than $800 million, and currently is approximately $400 million."
The statement prompted an audience member to question the move during the Q&A session this afternoon (see Fitz & Jen blog on Editor and Publisher's site for more).
Executives at the presentation outlined how they were cutting costs including consolidation in areas like general administration, production, technology, circulation sales, and distribution. The company is trimming its benefits and decreasing the pension for non-union members as well as cutting back on newsprint -- eight of its regional papers are scheduled to shrink.
On the online front, Martin Nisenholtz, senior vice president of digital operations, warned of an online revenue slowdown in the months ahead, particularly with display advertising. He mentioned the company started to see softness in November, which is accelerating in December. "Next year is a different year," he said.
Ad rates for the flagship are expected to remain flat this year and there are no plans for price hike for subscriptions or newsstand editions.
Executives said they were constantly evaluating the mix of its portfolio. Said Follo: "Although the feasibility of asset sales at this time is uncertain given the current market and credit environment, it's incumbent upon us to make sure that we carefully evaluate our properties to determine if they remain a strategic fit and, given the outlook for the business and their financial performance, make sense to continue to be a part of the company."