New York Times Company abandons dividend to save cash

by Staff, Brand Republic 20-Feb-09, 09:00

NEW YORK - The New York Times Company has suspended its first quarter dividend in order to pay off its debt and conserve cash.

The New York Times board of directors voted to suspend dividends for its Class A and Class B common shares, extending the action they took in the fourth quarter of 2008, when they cut the dividend from $0.23 per share to $0.06.

The board follows several other US publishers who have recently cut dividends, including McClatchy, EW Scripps and CBS.

The Ochs-Sulzberger family own about a fifth of the publicly traded Class A shares and nearly 90% of Class B shares, which dictate control over the company.

Struggling under $1.1bn in debt amid bleak economic times, the suspension is the latest move by the company to ensure its survival.

Last month, the publisher borrowed $250m from Mexican billionaire Carlos Slim. It has also been looking to sell its stake in the the Boston Red Sox baseball team, while also seeking to raise cash through a leaseback deal for a portion of its New York headquarters.

Arthur Sulzberger, Jr, chairman of the The New York Times Company, said: "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."

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