NYT Suspends Dividend; Even 6 Cents Per Share Was Too Much
This story was written by Staci D. Kramer.
Now The New York Times Company (NYSE: NYT) will see how much support it really has from its non-employee family shareholders: the board of directors voted today to suspend the quarterly dividend for Class A and Class B shares. It's all about keeping as much cash as possible in an increasingly tough ad marketand an even tougher credit market. The decision follows last quarter's dividend cut to $0.06 from $0.23 in Q308. The explanation from NYTCo Chairman Arthur Sulzberger, Jr.: "Today's decision provides the Company with additional financial flexibility given the current economic environment and the uncertain business outlook. We have taken decisive steps to reduce capital spending, lower operating costs and re-evaluate our assets. Last month we announced a private financing transaction for $250 million in senior unsecured notes and warrants. We also recently announced that we are exploring the possible sale of our ownership interest in New England Sports Ventures, LLC. We expect the suspension of the dividend, coupled with our other actions, will help us decrease debt and improve the liquidity of the Company, a difficult but prudent measure in this operating environment." More to come.
By Staci D. Kramer