Gray Television Inc. said Monday that it will likely be out of compliance with certain financing rules by the end of the month, which could lead lenders to demand faster debt repayment. Its share sank.
The company, which operates 36 television stations around the U.S., said the loss of advertising revenue — particularly from the automotive industry — has hampered its ability to generate cash. That means it expects to violate a covenant requiring a specific ratio of debt to cash.
At the end of the fourth quarter, the company had $16 million in cash — roughly half of the $30.6 million it had at the end of 2008. The company had about $791.8 million in long-term debt. More…