NYT Company Stock Price and My Portfolio: Fight or flight?

I visit http://www.nytimes.com/ and find that My Portfolio is missing. Am I being dumb. I go to My Times (which, by the way, is just awful in terms of setting up a NYT for a non-U.S. reader) and can't find it there either.

I go to http://www.nytco.com/


So what was the closing price of the NYT Company last night?

45 cents below $10.

$10 for me has always been the tipping point price.

With all the bad news from last week I blogged on, and more I am yet to do (notably the Moody's credit rating moves), and with a shocking Friday on WS (which surely anyone with a brain knew was coming), I can't say this is a surprise.

The question for NYT Company investors is quite simply this.

Fight or flight?

This company is in deep trouble.

They have to come up with a game-changing plan so good investors will go for it. Have they got one? I see no evidence.

They have to reduce debt and off-load some assets.

The Boston Globe? The regionals? The IHT? Who would buy them in this market and at what price? Who knows....

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New York Times editorial page editor Andrew Rosenthal on Op-Ed page contributors

NYT's Unforgettable Hire: Bono
BONO PRO BONO Bono, Rosenthal (inset) (Photo: Getty Images) Like Vanity Fair editor Graydon Carter before him, New York Times editorial page editor Andrew Rosenthal sees something special in a certain teensy Gaelic man who refuses to remove his sunglasses. That's right, the Timesman announced last night his first acquisition for the paper's Op-Ed pages for 2009: Bono. Yep, Bono. The activist-creator of Zoo TV will pen between six and ten pieces for the Grey Lady next year, Rosenthal told students Wednesday night at Columbia's School of Journalism.
So might this new hire be taking the position of—or helping to off-set the damage done by—any especially right-leaning columnist currently under fire for his devotion to vice-presidential candidate Sarah Palin? Say, Bill Kristol, for example?
Rosenthal dodged questions about Kristol, refusing to say if the Times would renew the right-wing columnist's contract when it expires in January, or who might replace him if he goes. Instead he cracked wise and affectionately of all his columnists. Kristol, for example can be "kooky," and in fact the whole staff, he noted wryly, is "incredibly easy to deal with and very humble." He took Maureen Dowd's infamous Latin column as a case in point: "I told her I thought it would be a little weird, and she did it anyway," but given that she's "the easiest and most pleasant edit of any writer I've worked with in my life," he let it slide.
Of course, in belt-tightening times, it's important to note that the ink of the high-holy U2 crooner comes free of charge: "Nothing," said Rosenthal of Bono's pay rate, noting that the Irish millionaire will muse on Africa, poverty, and, importantly, the music of Frank Sinatra. And while Bono may seem an odd choice for such a contract, Rosenthal did mention his current obsession with learning the guitar, and even shuffled freshly downloaded riff tablature together with his lecture notes. And though Rosenthal didn't announce any other celeb contributors, he did allude to re-recruiting the pen of Queen guitarist Brian May, who just earned his doctorate in astrophysics, and expressed admiration for previous opinion writers Bruce Springsteen and Larry David.
Of actual journalists, Rosenthal said he admired the work of the Atlantic's Megan McArdle and the National Review's Byron York.
Which is all fine and well, but are there former contributors Rosenthal doesn't like? "Condoleezza Rice is a particularly bad op-ed writer." And Tom Wolfe tends to write very long. So no Rice, less than Wolfe, and more in the spirit of Bono. Given that the Times' opinion pages could be the most competitive 800 words in journalism, any other pointers on how to make sure a fledgling contributor's submission will get printed? "Take a position in support of any Republican you care to name," the editor joshed. But it's a fine line, he noted with a smile: "The problem with conservative columnists," said Rosenthal, "is that many of them lie in print."
By Ben Chapman 10/23/08 9:25

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The New York Times Company Q3 2008 Earnings Call Transcript Q&A session

Question-and-Answer Session

David Clark - Deutsche Bank Securities
What sort of impact on circulation volume have you seen from your home delivery and single copy price increases at The Times over the summer? Second, what is the current guide count at www.about.com and is the plan still to scale up to 900 guides by next year or has that been scaled back in light of the economic environment?
Janet L. Robinson
I’ll have Scott give you the information on circulation and Martin will give you the overview in regard to the guide network.
Scott Heekin-Canedy
As with our price increases in recent years, we’ve seen better-than-expected volume drops as a result of the price increase. So we’re trending better than expected in circulation levels. The yield is significant and we expect to annually generate $16 million to $18 million of revenue from these increases.
Martin A. Nisenholtz
The current guide number is 770 and we are trending toward the 900 that you referenced for next year.
Operator
Our next question comes from Edward Atorino - The Benchmark Company.
Edward Atorino - The Benchmark Company
SG&A was down it looks like about $30 million from last year. Would that be a run rate going forward in terms of the year-to-year decline given the cost reduction actions?
James M. Follo
We continue to execute well as I said on the $230 million target and we have been really building the cost savings as we go, and the third quarter number was a number which far surpassed any other number. Specifically on the G&A line, I can’t give specific guidance on that but we certainly expect that the cash cost savings numbers will continue to show the sort of results that we saw in the third quarter. Specifically on that line, we certainly expect that line to come down in meaningful numbers going forward. I can’t give that precise number however.
Edward Atorino - The Benchmark Company
Joint venture income looked pretty good and with the newsprint environment, would the fourth quarter joint venture income be significantly above year ago? Well, last year was a loss. Would it be in the vicinity of the second and third quarter levels?
James M. Follo
We gave the full year guidance in the press release. The joint venture line has a seasonal aspect to it particularly as it relates to -
Edward Atorino - The Benchmark Company
Oh right.
Operator
Our next question comes from Peter Appert - Goldman Sachs.
Peter Appert - Goldman Sachs
On the cash flow front Jim, I’m wondering if the $80 million capital spending plan for ’09, should we think about that as the sustainable number going forward? Related to the cash flow also for Janet, I’m wondering how seriously you’ll consider asset sales as you review the efforts to cut debt? And one other unrelated item, on the newsprint front there’s some talk in the market that maybe the pricing pressure’s easing a little bit during the fourth quarter. What are you guys seeing?
James M. Follo
Let me deal with the cap ex number first. The $80 million number actually includes two items which we view as somewhat non-recurring and both of them are meaningful parts of that $80 million. We still have as we mentioned a plant consolidation in Boston. That will contribute meaningfully to that number. We are still in the final stages of our SAP implementation which will be complete in mid-2009. Ex those two numbers, I think that number actually comes down somewhere in the $20 million to $30 million range now. I wouldn’t call a $50 million number a sustainable long-term number but we don’t see the $80 million as something as you look out next year as a good target.
On the newsprint side there’s clearly a potential leveling out. As we go into the fourth quarter there are several factors that are helping to mitigate some what we hope further increases. We do see the price increases that were announced as largely sticking. That has been a $20 per month increase due at the year. That being said, I think we do view the prices [inaudible (2) 06:20.2] to 2009 as flattish [inaudible] we look at the Canadian dollar and some of the raw material and energy prices both favorably impacting of course the consumption across the board also and compacting it. But we do think longer time really 2009 is more of a flattish type of environment.
Janet L. Robinson
On the sale of assets, divestitures, as you know we don’t comment on that but we have said often that we constantly review our portfolio and will continue to going forward.
I think the focus right now is making sure that these properties are running as efficiently as possible. We’re making sure that the cost base of all of them are being brought down quite dramatically as evidenced by what we’ve done at The Times in the case of the C&S distribution arm closing, the consolidation at Edison, and certainly the closing of [Bell Ricker] in Boston. We’re going to continue to do those things to make sure that all of these properties are run as efficiently as they possibly can be.
Peter Appert - Goldman Sachs
Is there a specific debt level or leverage ratio that you folks might like to be at by the end of ’09 let’s say?
James M. Follo
We don’t have a specific target other than we are certainly mindful of providing some balance sheet flexibility through lower debt levels but I don’t have a specific target. It’s really just a function of the environment and our view of the business on operations.
Operator
Our next question comes from Alexia Quadrani - J.P. Morgan.
Alexia Quadrani - J.P. Morgan
Janet, when you mentioned the constant reviewing of your portfolio, do you think there actually are buyers of newspaper assets right now currently in the market place? My second question is, on the Internet side of the business where you talk about the weakness in display advertising going forward, is it on any specific one property or is it across the board there?
Janet L. Robinson
I’ll have Martin answer the Internet advertising.
In regard to the outlook I guess in regard to potential buyers for newspaper properties, I think this is a difficult time for our industry. It’s clear that we are facing secular and cyclical headwinds. But I think from a standpoint of the brands that are represented by newspapers nationally, it’s clear that these are still very strong brands in their communities and beyond.
In light of that many newspapers of course are not just positioning themselves as newspaper companies; they are positioning themselves as news media sources that are extending their content over a variety of platforms. I think from a standpoint of timing right now, it is a very difficult time for asset sales but I think that companies overall are doing exactly what they should; focusing on the productivity of those assets, expanding the base across platforms to make them very profitable business that contribute to the bottom line.
Martin A. Nisenholtz
Regarding the Internet revenue streams, it really isn’t equal across the properties. The CPC and lead gen businesses which are really more in the About area remain quite robust; very strong. Display at the lower end of the business is weaker. At the higher end it’s holding fairly firm. Of course classifieds which have been weak all year in help wanted continue to be weak. As we look out we don’t see a change in that. So it isn’t really a uniform story at all across the four segments.
Operator
Our next question comes from Katrina Fallon - Citigroup.
Katrina Fallon - Citigroup
In terms of the dividend discussion with the Board, what is the main focus there? Is that maybe reducing the dividend yield, working on cash flow or is there something else that’s driving that? Secondly, on the digital aspect can you give some detail on CPM for the higher end ads or the front page of the www.nyt.com and maybe some other color on a range of CPM?
James M. Follo
On the dividend front it’s a fairly dynamic discussion. This is a discussion that takes place at every board meeting and it’s just a function of how we want to allocate capital, what we see in the future as far as investment opportunities, and making sure that we have sufficient balance sheet capacity and flexibility in order to be able to invest and grow the business. That’s the way that we think about it.
Martin A. Nisenholtz
On the CPMs front, CPMs at www.nytimes.com have been up in the mid-single digits year-to-date. That doesn’t include ad network CPMs which have also been up. I don’t have a specific number on that but they have climbed year-to-date as well.
Operator
Our next question comes from John Janedis - Wachovia Securities.
John Janedis - Wachovia Securities
Janet, you talked about visibility being limited on the advertising side, but can you talk about maybe the buying patterns within some categories? How much closer to run date are you seeing commitments come in from department stores or other categories compared to a quarter or two ago?
Janet L. Robinson
I think that there is more of a trending towards just-in-time placement across all of our properties; I think retail most of all primarily because of the nature of their business. That said though, there is quite a bit of business that is already on contract not only at The Times but at The Globe for example as well and that’s in a number of categories. I think from a standpoint of the economic situation that exists right now you’re seeing more just-in-time placement as opposed to longer flights and flights that are predetermined months in advance.
John Janedis - Wachovia Securities
On the contract side, given the economy, are you seeing instances where clients are trying to pull back on the contract or pull back on the commitment?
Janet L. Robinson
I think it’s really too early to tell. I think that certainly there will always be discussions about contractual obligations but the way contracts are put together, really they are incentivized to run a certain amount of advertising during the course of the year. So from a standpoint of their cost base, I think there are distinct advantages to sticking to the contractual agreements that they have agreed to, and I think in most cases people are going to be focusing on those advantages going forward.
John Janedis - Wachovia Securities
If I could just ask Martin a question, on your comment about the high end versus the lower end, can you give us an idea of maybe how much of the inventory is what you classify as higher end?
Martin A. Nisenholtz
My reference was really to higher end being at The Times’ website. In general that inventory is viewed as premium inventory as opposed for example to the About inventory. The question was, are all of the properties behaving the same and they’re not.
But with respect to your question about kind of parsing that a little bit, I would say that all of the inventory at www.nytimes.com is viewed because of the brand as higher end inventory or as premium inventory. We hold rates so we won’t sell inventory just to discount it but there’s no question, and we’ve said this over the past several years, that vertically oriented or more contextually oriented inventory is worth a lot more than general news inventory.
So in some ways you can cut the word premium by, is it premium as a result of its brand affiliation or is it premium as a result of its contextual affiliation. Those are sort of elastic. Those are two different dimensions to the question. The inventory that will tend to go more toward the remnant side at www.nytimes.com is the general news inventory.
John Janedis - Wachovia Securities
So a category like luxury and financials, you would say they’re hanging in there or does that mean they’re even -
Martin A. Nisenholtz
Very much so. In fact as I said, on the CPM side we’ve seen mid-single-digit increases this year and absolutely hanging in there for sure. Not just those two categories but certainly any categories that attract a commercial intent on the part of the consumer or that target a particular type of demographic. We’ve talked about executive decision makers in the past and that’s a particularly important and sizable segment for us.
John Janedis - Wachovia Securities
Jim, on the model, are the 3Q numbers for both corporate and D&A for About good run rates for the fourth quarter?
James M. Follo
I think that those should be good run rates.
Operator
Our next question comes from Edward Atorino - The Benchmark Company.
Edward Atorino - The Benchmark Company
Regarding the advertising outlook that you talk about October, do you think given sort of the credit crisis and the credit crunch and people watching their cash; you mentioned just-in-time advertising which has been my personal belief anyway; advertisers might have been unduly cautious and if the credit markets loosen up and they believe the money’s in the bank, they might put some money back into the ad budgets or is that wishful thinking?
Scott Heekin-Canedy
Advertisers are definitely taking a day-by-day wait-and-see approach to see where the markets are going, how the economy is going to respond, and they’re trying to spend their ad dollars very judiciously. You’ve seen some nice increases particularly from financial services in the past month as institutions have tried to take advantage of this market place as well as reinforce their reputations.
Janet L. Robinson
We saw a strong climb in financial advertising both at The Times and at The Globe in regard to the advertising that addressed the crisis certainly with banks and financial institutions. So it’s clear when there is a deliberate reason for them to get their message out, they use these vehicles to do so; the immediacy of the message and the full explanation of the message in those kinds of ads that are appearing in those papers.
Edward Atorino - The Benchmark Company
You don’t think there’s been sort of a pressure on budgets because of cash that sort of exaggerated the weakness?
Janet L. Robinson
I think they are being extremely cautious in regard to how they’re spending their money. I don’t think the dollars are totally gone but I think that they’re just being very judicious in regard to how they’re spending. I also think in regard to the retail sector it will be a wait-and-see in regard to how the November and December timeframe performs for them because in many cases when things get more difficult for retailers, they do advertise more rather than less.
Scott Heekin-Canedy
In a similar vein, advertisers are telling us that they’re trying to wait as late in the year as possible at their ad budgets for 2009 to wait and see where the economy’s going to be going and how consumers are going to behave.
Edward Atorino - The Benchmark Company
Have you thought about an ad rate structure for ’09?
Janet L. Robinson
We haven’t decided specifically in regard to those structures as of yet. I think that there will be further evaluation. I think we will be very conservative in regard to any rate increases that we’re looking at for 2009 particularly because of the economic situation.
Operator
Our next question comes from Craig Huber - Barclays Capital.
Craig Huber - Barclays Capital
About the pension, just looking at your 10K I think it was underfunded last year by $275 million and I think you have about $1.5 billion of assets. Just given here the S&P 500 is down 35% to 40% this year; I guess most bond funds are down 5% to 10%, it’s probably not unreasonable for your pension assets to probably be down a good 20%. That would probably put your underfunded status up or down $600 million give or take. I’m not a pension expert by any stretch, but if you have roughly seven years you have to get that back to break even, does that mean investors should expect a large outflow of cash going into your pension plan of $80 million give or take?
James M. Follo
I think the number you are referring to regarding the funded status was all both funded and unfunded plans. The qualified plan which is the ERISA plan was fully funded as of the last balance sheet date. It’s also true however with the credit markets and the equity markets being what they are, we’ve obviously had some asset losses through the first nine months of the year. We don’t think that’s a big material number. It’s hard to quantify. It’s a fairly dynamic number and really hard to predict now.
Craig Huber - Barclays Capital
Do you have any idea how much potentially cash you’ll have to put into your pension plan?
James M. Follo
In 2009 we think it will have no impact as you have to think of much further out. A lot can happen between now and then before you have to commit, but we don’t think this thing is a $100 million number. It certainly puts more pressure but again in 2090 it will result in no additional contributions to the qualified plans.
Craig Huber - Barclays Capital
Back on the dividend discussion, are you guys contemplating at all taking the dividend to zero or potentially just cutting it in half like McClatchy did here recently?
James M. Follo
That’s something that we’ll have full deliberations as we always do with the Board. That’s not something we can comment on.
Craig Huber - Barclays Capital
On your comments in the digital “slowing,” could you just quantify a little bit better what you’re seeing at www.about.com so far this month? Is the growth rate slowing there or what?
Martin A. Nisenholtz
The growth rate on revenue has slowed at About this month. As I said before it’s a result of the display side of the business, the non-premium display side of the business. We are continuing to see very robust growth in CPC and lead generation but the non-premium display inventory is under pressure.
Operator
Our next question comes from Scott Davis - J.P. Morgan.
Scott Davis - J.P. Morgan
I’m looking at About and I was curious about the other side of the equation which is the cost side. I was wondering if Martin could give maybe a minute of color on what you’re doing there because costs for my numbers excluding D&A grew 5% or 65 which is vastly better than the 30% to 40% to 50% growth that you had had. Are we just anniversarying the sales growth that you put in place or is something else happening?
Martin A. Nisenholtz
Yes. In part that is what we’re doing. As I think you know if you’ve followed this story to date, we’ve invested a significant amount of money in the sales force rebuild and we’re committed to that. We think it’s an important part of the business and we think that we need to have at About a highly competent and sizable sales force given the size of the business. That was the principal investment that we made.
James M. Follo
It’ll also be anniversaried against the consumer search acquisition. That acquisition was done I believe in May 2007. So this is the first quarter in which we anniversaried against a full quarter’s worth of expense.
Scott Davis - J.P. Morgan
So the cost growth that we saw this quarter you think is representative going forward?
James M. Follo
I think in general terms that’s right.
Scott Davis - J.P. Morgan
It seems like a small issue but sadly About’s profitability is becoming a fairly big piece of the company so it feels like it’s an important one.
James M. Follo
I would add just one other thing. It doesn’t totally go to the growth but embedded in there as we continue to invest small but meaningful amounts in About China as well. That we see continuing for the foreseeable future.
Operator
There are no further questions at this time. I would like to turn the conference back over to Ms. Catherine Mathis.
Catherine J. Mathis
Thank you all for joining us today and if you have any additional questions, please give us a call. Thanks so much.
http://seekingalpha.com/article/101576-the-new-york-times-company-q3-2008-earnings-call-transcript?page=-1

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NYT Company Stock Price

The markets seem to agree with those Q3 results - in line with analysts' expectations.

But I think they are factoring in a sharp drop in the dividend ($25 million alone to family members with $1.2 billion of debt, so the question is, will the family stand firm on this and not do a Bancroft when someone comes tapping on the door).



Name
Last price
1-day$ change
1-day% change
30-day% change
Shares
Totalvalue

New York Times Company NYT: NYSE
$10.70
$0.02
+0.19%
–25.90%

News Corporation NWS.A: NYSE
$9.00
$0.54
+6.38%
–30.02%

Pearson PLC. PSO: NYSE
$9.67
$0.32
+3.42%
–11.53%

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Still waiting to see the Q3 transcript but in the meantime, some happy memories from Q2.

Snippets from Q2 2008 NYT Co. Conference Call as I wait to read the Q3 one (which I can't wait any longer because I'm going out.)

Back in the days when banking analysts were asking questions about the impact of increased oil prices on delivery costs (HA!!! - wrong question dudes and btw, it was only about a couple of million bucks.)


Denise Warren
At NYTimes.com, about 50% of our overall revenue is priced on a CPM basis and we have seen increases year-to-date year over year in the CPM price business. In addition, as Martin alluded to, we try to maximize all of our revenue and all of our inventory, so we do sell some of our inventory out at the networks and we’ve seen substantial increases in the CPM that we’ve been able to generate from the ad networks.
And the fixed price units that we saw, which account for about 30% of our overall revenue, we’ve also seen rate increases in as well this year.

Craig Huber - Lehman Brothers
Just to be a little clearer, your July comments for your newspapers, are the trends there -- I know we’re not done with the month -- are the trends there looking worse than what you saw in June for your two flagship papers on a percentage basis year over year?
Janet L. Robinson
We really can’t give you the specifics, but I think from the standpoint of what we’ve said, Craig, it really is the case. We see some tightening up in a variety of categories. I think the economy certainly has many of the major category clients very concerned and I think that you are going to see some softness across the board at all media companies in regard to the spending patterns, the newspaper media companies.

Peter Appert - Goldman Sachs
Thanks. Janet, you gave us some color on categories that are stronger and weaker, but I’m noticing a pretty significant deterioration in the ad revenue trends at the New York Times over the last several months, so at the margin, which of the categories or which of the major advertisers that really cut back most substantially to drive that?
Denise Warren
We did have a weakness in entertainment because of the tough comps that Janet referenced, so I think that’s probably impacting the June performance in a big way. Otherwise the trends are fairly similar to what they have been.
Peter Appert - Goldman Sachs
Okay, and my recollection is entertainment is maybe something like 10%, is that right?
Denise Warren
Yeah, just about -- a little bit higher, actually.


Peter Appert - Goldman Sachs
Fair enough, and Janet, this is a tough one but as you think preliminarily about 2009, I’m wondering how you think the ad cycle goes in the context of a macro environment that maybe is more or less the same as what we are seeing now. Can you get back to positive revenue comps next year, you think?
Janet L. Robinson
I think we certainly see a tough second half, if indeed the economy continues to act the way it’s acting right now. I think it’s very early for us to be looking at 2009. I think that there are signs certainly from some sources that say that the housing market will not improve until the latter part of 2009 at the earliest, so I think that there is still increased difficult in regard to the ad market going forward, but I think it’s very early for us to be projecting our thoughts regarding that, Peter.

David Clark - Deutsche Bank
Okay, and then I’m just curious, how much subscriber or reader overlap is there between the New York Times and the Wall Street Journal? Is that something you guys know?
Janet L. Robinson
It’s relatively small, David. I would say that it’s around 11% or so.
David Clark - Deutsche Bank
Okay, so 11% of your circulation area also subscribers to the Journal?
Janet L. Robinson
That’s correct.
David Clark - Deutsche Bank
Okay, and then just one final circulation question -- how many subscriptions roughly have you sold through the Amazon Kindle? Is it a meaningful amount? Is the trend there good?
Denise Warren
It’s a small amount but we are under the terms of a confidentiality agreement, so we are not allowed to disclose it.
Roland Caputo
But the -- I’d say that the trends are good.
David Clark - Deutsche Bank
I guess following on that, do you see that, either the Kindle or other potential e-readers, do you see a meaningful opportunity there for increasing circulation?
Roland Caputo
These are R&D efforts. I think that it’s very early days on e-readers. Certainly the Kindle seems to be attracting a lot of attention. We are the number 11th or 12th most purchased product I believe on the Kindle these days, and that I think you can see by simply going into most popular. You can see that on whisper net.
But I think it’s safe to say that it’s very early days for e-readers and I would characterize this more as an R&D effort than a meaningful revenue contributor.

Scott Marchakitus - Goldman Sachs
This is Scott Marchakitus. I’m on the credit research side. I just have two quick questions for you. First of all, I just want to talk about the liquidity position. You have an $800 million revolver, half of which expires in mid-2009. I’m just wondering if you could tell us what’s drawn under the total revolver and if you are in negotiations with the banks to extend that facility, for at least the next year’s [debt maturing] for future years.
And then secondly, there’s one financial covenant in the bank facility with regard to shareholder equity being $950 million. Can you talk about the add backs to get back to that number and where you stand related to that covenant today? Thanks a lot.
James M. Follo
As far as the borrowings under our revolver, we’re out about $375 million out of a total capacity of $800 million. We are in discussions with our banks that one of our lines, revolvers expires in May of next year. We’re in discussions right now. Those discussions are [inaudible].
Roland Caputo
And regarding the covenant, we have a lot of room relative to that minimum stockholders equity covenant. We’ve [slowed] non-cash impairment charges, so if you add back the charges we had in ’06 and ’07, we’re well ahead of that minimum [inaudible] requirement.
Scott Marchakitus - Goldman Sachs
Are the add backs $800 million in nature, or [that number you’ve disclosed]?
Roland Caputo
If you look at the 2006 impairment, it was about $814 million. In 2007, it was much smaller but we would add those back to our book equity, [the total equity].
Scott Marchakitus - Goldman Sachs
And just a quick follow-up; we’ve seen a lot of downgrades by the agencies in the newspaper sector, particularly among some of the higher yielding names. Now, you stand at low Triple B. I’m just wondering if it’s really important for you to keep an investment grade rating in light of the shareholder demands for enhancing shareholder value, whether it’s restructuring the portfolio or buy-backs or that nature. Is keeping your investment grade rating critical anymore?
James M. Follo
It’s historically been important to us and we consider -- it is the balance between increasing share value and cost of debt borrowing. We balance those two but we’ve historically enjoyed investment grade rating and we expect to do that in the future.
Scott Marchakitus - Goldman Sachs
Thank you very much.

Scott Marchakitus - Goldman Sachs
And just a quick follow-up; we’ve seen a lot of downgrades by the agencies in the newspaper sector, particularly among some of the higher yielding names. Now, you stand at low Triple B. I’m just wondering if it’s really important for you to keep an investment grade rating in light of the shareholder demands for enhancing shareholder value, whether it’s restructuring the portfolio or buy-backs or that nature. Is keeping your investment grade rating critical anymore?
James M. Follo
It’s historically been important to us and we consider -- it is the balance between increasing share value and cost of debt borrowing. We balance those two but we’ve historically enjoyed investment grade rating and we expect to do that in the future

Those Goverment Sachs boys sure were well ahead of the game as judged by the various analysts questions.

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The Newspaper Industry's Latest Challenges (Seeking Alpha.com)

October 23, 2008 about stocks: GCI / MNI / NYT / WPO
It seems like every week we hear more news heralding the newspaper industry's struggle and decline. There's no question the credit crunch and its various effects -- from making credit tight to hurting the advertising industry -- is making an already suffering business even worse.
Now a handful of prominent newspapers around the country announced they're leaving the Associated Press organization to trim costs. The Tribune Company, one of the nation's largest newspaper chains, the Columbus Dispatch and others are giving the A.P. two years notice. They may change their mind, or this could be a threat to get the A.P. to lower its costs, but contractually they need to give the two years notice so these papers are setting themselves up to cut up to hundreds of thousands of dollars from annual budgets, also leaving them with much less, if any, international coverage.
Meanwhile the Tribune Company plans to borrow $250 million from an existing credit facility. It seems safe to say that the newspaper publisher that owns the Los Angeles Times and Chicago Tribune has been struggling-- most recently struggling to pay down billions of dollars in debt taken on when Sam Zell took the company private last year. When Zell led the privatization of Tribune, many on Wall Street wondered if Zell, known for buying up distressed assets, knew something the rest of the investing community didn't. Now it appears he doesn't.
The statistics bear out all this bad news. Goldman Sachs' analyst Peter Appert tells me that newspapers are suffering their worst stint since the great depression. Newspaper stocks are on the whole down over 60 percent year to date, about twice the drop of the S&P. Newspaper advertising revenue has fallen about 25 percent over the last two years, in a bit of a perfect storm. There are secular pressures, as newspaper ads lose ground to the more flexible and measurable Internet ad format. And now there's this industry-wide ad downturn. On top of all that, newsprint costs are expected to rise between 20 and 30 percent over the next several quarters. Ouch.
Brand names like the New York Times (NYT) and Washington Post Company (WPO) will retain their value, but Wall Street analysts are telling me they expect those companies as well as the likes of Gannett (GCI) and McClatchy (MNI) to restructure -- slim down with a greater emphasis on their websites. Analysts for the most part recommend investors wait on the sidelines until these stocks start to turn around, but the one stock I'm hearing more positive buzz about is Gannett because it's trading at a historically low multiple and it has a healthy dividend yield (now around 10 percent). That said, this isn't the last of the industry's bad news.
http://seekingalpha.com/article/101465-the-newspaper-industry-s-latest-challenges

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But About.com revenues rise 16% (or shoutld that be only?)

I think my PERSONAL CONSUMER views about About.com are know - so know emails please - but the NYT's own media correspondent RICHARD PÉREZ-PEÑA should know better to write about increases in about.com revenues (a meagre 16.1 percent) as if this was something to write home about. From what base Richard and how fast do they need to grow to prop up that declining print revenue? And how much of that growth came from acquisitions?

There's no BUT here Richard, only an ONLY about About.com revenue.




October 24, 2008
New York Times Co. Posts Lower Profit
By RICHARD PÉREZ-PEÑA
The New York Times Company reported a 51.4 percent decline in third-quarter profit on Thursday and swung to a loss on continuing operations as deeper-than-expected expense cuts could not keep pace with declining revenue.
The company said it would consider cutting its dividend and planned to write down the value of assets in its New England Media Group, which includes The Boston Globe, by as much as $150 million.
“Our board of directors plans to review our dividend policy before the end of this year to determine what is most prudent in light of the overall market conditions,” the company’s chief executive, Janet Robinson, said in a statement.

Online revenue rose just 2.5 percent for the company’s newspapers, which include The New York Times, The Boston Globe, The International Herald Tribune and 17 smaller papers. But the company’s other online businesses, including About.com, increased revenue by 16.1 percent, despite the economic downturn.

http://www.nytimes.com/2008/10/24/business/media/24times.html?ref=business

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Debt, revenue and tipping points at the NYT Co: take over rumour situation? Buy now or keep on selling short?

I've been posting on NYT debt and revenue and tipping points in consumer confidence for some time. Interesting to note that these latest Q3 results have got people saying the unthinkable: the end of the NYT or at least an iminent crisis?

BTW: call this journalism? An article about how the NYT might start attracting takeover rumours whilst planting one itself with no other reference to anyone? Opinion, and interesting.

Time to check that share price after this one....

NEW YORK (MarketWatch) -- New York Times Co. is in danger of attracting takeover rumors.
On Thursday, the Times Co. which also owns the Boston Globe and additional assets, reported that third-quarter net income fell to $6.5 million, or 5 cents a share, compared with a profit of $13.4 million, or 9 cents a share, in the year-ago period. Including $10.3 million, or 7 cents a share, in severance costs related to the shutdown of a New York-area newsstand distribution unit, the company posted a preliminary loss from continuing operations of 1 cent a share. See full story.
Whatever.
Can you remember the last time New York Times Co. actually reported shoot-out-the-lights numbers? Or even fist-pumping, high-fiving good news of any sort?
Times supporters will say that without the severance costs the company would have earned 6 cents a share. At the same time, its revenue fell 9% to $687 million. One step forward, two steps back.
It's getting to a depressing point where the Times is approaching a crisis of confidence, if not the beginning of a financial crisis. Its newspapering rivals, at least, can hope for help from other units
The Washington Post Companyhas reaped handsome benefits from its Kaplan education business, for instance).
But the Times can't hope to find the same sort of assistance (and yes, Kaplan, too, has lately had its share of challenges).
How long will it be until the vulture mergers-and-acquisitions pros start to smell a takeover of the Times at these levels? The Times' stock price may sink further, only making the company seem more appealing to a bargain hunter who sees value in arguably the most prestigious brand name in the media world. Of course, the controlling Sulzberger family must agree to an acquisition.
The Times had better get its act together, or its business writers will end up writing stories about those vultures circling the newspaper's sparkling new headquarters.
-- Jon Friedman
http://www.marketwatch.com/news/story/new-york-times-brings-wall/story.aspx?guid=%7B99971D8D-4618-4868-A24F-2CC95BED3CE0%7D

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Dividend, debt and junk rating - just a quick look back.

NYT Co. are talking of cutting their 2008 dividend which, with decreasing revenues would be a pretty good idea, if it wants to continue to service that $1.2 billion of debt and not obtain a junk status.

The Q3 results announcement does have JR talking of conversations with lenders and 'evaluating future financing arrangements', so something is a foot, and this story from back in August reminds of us why.

AP
New York Times shares plunge on ratings concerns
Tuesday August 12, 6:37 pm ET
NY Times shares fall after report says publisher could preserve rating by cutting dividend
NEW YORK (AP) -- New York Times Co. shares slumped Tuesday after an analyst suggested in a media report that the company may need to cut its dividend to avoid a "junk" credit rating.
The newspaper publisher's stock dropped 85 cents, or 6 percent, to $13.24 Tuesday. In the past year it has ranged from $12.08 to $22.95.
Last year, the company raised its quarterly dividend 31 percent to 23 cents, which costs it more than $100 million a year in payments to shareholders.
New York Times Co. has seen revenue contract in recent quarters, which crimps cash available for operations and payments. That led Moody's Investors Service to say it may cut the company's credit ratings if operating metrics do not approve.
Earlier Tuesday, Bloomberg quoted a credit analyst with Moody's Investors Service saying the company may need to preserve cash -- potentially by lowering the dividend -- to avoid having its credit rating slashed.
Ratings indicate a company's ability to repay debt and are used by lenders to set the terms of borrowing. Lower ratings mean more expensive credit for a company.
Two weeks ago, Moody's changed the company's rating outlook to "Negative" from "Stable" on concerns about slipping advertising sales. Moody's said the lower ratings outlook reflects worries that the Gray Lady's ad revenue could slip further.
"The New York Times' first-half 2008 operating performance is in the range Moody's anticipated, but there is increasing risk that earnings in the second half of 2008 and in 2009 could fall below prior expectations," Moody's said.
The ratings agency held its senior unsecured Prime-3 commercial paper ratings for the company steady at "Baa3," the lowest investment-grade rating.
The New York Times Co. did not immediately return calls seeking comment.

http://biz.yahoo.com/ap/080812/new_york_times_mover.html?.v=1

New York Observer on NYT Q3 Results

Sinking feeling



Times Company Stock Hits 52-Week Low
by John Koblin October 23, 2008

On a morning where The New York Times Company's stock hit its 52-week low at $10.39, Times Company C.E.O. Janet Robinson used the most palatable phrase she could find—"a continuing softness"—to describe the bleak third quarter results to investors today.
In all, the Times Company's net income dropped 51 percent this quarter versus 3Q 2007, revenues were down 8.9 percent, advertisng revenue down 14 percent.
Ms. Robinson said that luxury advertising was one of the things that saved the advertising numbers from being worse (T magazine, thank you very much); in total it made up a total of 13 percent of total advertising revenue.
Lots of jobs have been cut this year for the Times Company—and more are on the way—and up to this point NYT Co. has paid out $56.9 million in severance packages.
Times execs also announced that they are considering cutting the company's dividend, one of the last reliable places for income for Sulzberger-Ochs clan, and for increasingly desperate shareholders. Last year they increased the dividend more than 30 percent; it's also what reserved a $25.1 million pool of cash for the family a year.
Moody's said that if they don't cut the dividend, the Times is perilously close to getting a Junk bond status, which won't be good for anyone.

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Yesterday's White Powder Scare: NYT Staff take showers (NYT)

Here's a more complete version of what happened yesterday at the NYT. Apparently it was all an unfortunate mix-up as various cold and other remedial powders had been shipped in by staff members to help them pull an all nighter preparing the Q3 Results for the following day.

Not what Ms. Mathis required either I should imagine, the eve of the big day.

(Shares now at

.)

The lobby of The Times’s building, at 620 Eighth Avenue, was closed for several hours. It reopened after the substance was found to be harmless. (Photos: Chang W. Lee/The New York Times)

Workers investigating the substance donned hazardous materials suits.

October 22, 2008, 1:58 pm — Updated: 9:38 pm -->
Times Lobby Reopens; No Hazard Found
By Sewell Chan AND Al Baker

Updated, 6:30 p.m. The lobby of The New York Times’s headquarters building in Midtown Manhattan was closed for nearly four hours on Wednesday after an employee opened an envelope that contained a suspicious substance, officials at the newspaper said.
The authorities determined the substance was not hazardous, and the lobby was reopened by 3:40 p.m. “We are glad that we can bring this unfortunate incident to a close,” Dennis L. Stern, senior vice president and deputy general manager of The Times, wrote in an e-mail message to employees.
Police officials said that three Times employees were asked to take showers as a precaution against contamination. The 13th floor, where the envelope was opened, was briefly evacuated, but around 2 p.m., employees on that floor were permitted to return to their offices, according to Catherine J. Mathis, a spokeswoman for The Times.
The letter was addressed to Andrew Rosenthal, the editorial page editor of The Times, according to Paul J. Browne, a spokesman for the Police Department. The address of The Times was hand-written and there was no return address.
“The white powder turned out to be some kind of pebbles,” said Mr. Browne, who noted that it was still being tested. He said the letter was initially “sealed up” by security personnel at The Times and that those security workers brought it to the lobby, which is likely what prompted the shuttering of the lobby.
Mr. Rosenthal’s executive secretary opened the envelope, and a white powdery substance came out of it, the authorities said.
“It was deemed to be non-hazardous minerals,” Mr. Browne said. “They do field tests and then they do later exams, but the initial testing indicated nonhazardous minerals.”
The envelope was post-marked in Florida, Mr. Browne said, though he could not say what city. Inside the envelope, Mr. Browne said, was what appeared to be a page from a child’s penmanship book. Nothing was written on it.
The secretary and two other Times employees, including a mailroom worker, were being decontaminated as a precaution, Mr. Browne said. As part of the decontamination, the workers had to bag their clothing and take showers.
Mr. Stern told employees in an e-mail message at 12:24 p.m.:
At about 11:30 a.m. today an employee on the 13th floor of our headquarters building in New York opened an envelope addressed to The New York Times. A white granular substance was in the envelope. The New York City police were called and are now on site investigating. The 41st Street side of the lobby is closed but people are able to get in and out of the building. We will keep you updated on any developments.
Employees at The Times were instructed over the public address system to use the building’s freight elevators and loading dock to exit or enter, while the lobby remained closed.
“No evacuation is necessary,” security officers at The Times announced, repeatedly, over the building’s public-address system. (After hearing one such announcement, the writer and playwright Moisés Kaufman, who was giving a talk to Times employees on the 15th floor of the building, quipped, “If I have to stay here, I want a salary.”)
Designed by the architect Renzo Piano, The Times’s building, at 620 Eighth Avenue, between 40th and 41st Streets, officially opened in November 2007, but the newspaper began moving into its offices there several months earlier.
On Oct. 12, 2001, The Times briefly closed its offices, then located at 229 West 43rd Street, between Seventh and Eighth Avenues, after a reporter, Judith Miller, opened an envelope and released a talclike powder. The newsroom was evacuated and the police temporarily sealed off the building, but tests found no dangerous elements in the powder.
Ms. Mathis said that since then, there have been several other cases of suspicious materials being sent to The Times. None turned out to be harmful.

Police officers in the lobby of The Times, which was closed for nearly four hours.

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The New York Times is moving its Beijing bureau chief Jim Yardley to India, replacing Somini Sengupta as the bureau chief in New Delhi.

New York, Oct 23 (IANS) The New York Times is moving its Beijing bureau chief Jim Yardley to India, replacing Somini Sengupta as the bureau chief in New Delhi.
The Times' Olympics reporting this year under Yardley won fulsome praise from the paper's executive editor Bill Keller as 'stunning' and 'dazzling' in internal memos, The New York Observer, a weekly newspaper, has reported.
During his five years in Beijing, Yardley also won a Pulitzer in international reporting in 2006.
Sengupta, who spent four years as the New Delhi bureau chief, will take a temporary sabbatical in the Netherlands before getting a new assignment.
In a reshuffle at the Times foreign desk, Yardley will be joined in India by Lydia Polgreen, currently the paper's West African correspondent.
At a time when US newspapers are shutting or trimming their foreign bureaus to cut costs, the Times is not ready to sacrifice its foreign reporting edge.
NYT's foreign editor Susan Chira told the Observer: 'Luckily, the top management of the Times sees foreign news as essential to the identity and mission of the Times. So while we are careful to pare costs whenever we can, and while we have had to juggle bureau positions so we don't go up overall, we are in the fortunate position of avoiding major cuts.'
http://newsfromamericas.blogspot.com/2008/10/nyt-moves-beijing-bureau-chief-to-india.html

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NYT's Play NOT Being Shuttered (FishbowlNY

Thursday Oct 23, 2008

Given the terrible week it's been in the media world (no links, too depressing), we weren't surprised when we heard the rumors that Play, The New York Times' Ellie-nominated sports magazine, was going to close up shop after its next issue. Say it ain't so, NYT.
In an effort to find out the truth, we emailed the mag's editor Mark Bryant, who admitted he'd heard the rumor as well (that had to be pretty surreal), but assured us there wasn't any truth to it.

Thankfully, the rumors aren't true. Play is scheduled for four more issues for next year, beginning with a March 29 issue.

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AP's reading of the NYT Q3 results

AP
NY Times 3Q profits down 51 pct, beats estimates
Thursday October 23, 11:21 am ET By Anick Jesdanun, AP Business Writer
NY Times says 3Q profits down 51 percent as ad revenue drops, but beats Wall Street estimates
NEW YORK (AP) -- The New York Times Co. reported Thursday that its third-quarter profit dropped 51 percent but still beat Wall Street estimates as the newspaper industry continues to suffer from advertising reductions accelerated by a worsening economy.
Early numbers from the current quarter indicate that slow ad sales at the Times newspaper and other properties are likely to continue into the normally lucrative holiday period, especially in digital advertising -- the industry's hope for the future.
The Times said that preliminary net income in the July-September quarter was $6.53 million, or 5 cents a share, compared with $13.4 million, or 9 cents a share, in the same period last year.
Profits will be reduced, though, once the Times takes an accounting charge estimated at $100 million to $150 million to reflect the declining value of its New England newspapers as revenue prospects remain weak because of the ongoing migration to the Internet.
Excluding severance costs and broadcast operations sold last year, the Times earned 6 cents a share. Analysts polled by Thomson Reuters, who generally exclude such one-time charges, were expecting 4 cents a share.
Revenue dropped 9 percent to $687 million, from $754 million, roughly in line with analyst expectations of $692 million.
Advertising sales fell 16 percent at the Times' news media properties, which include print and online operations for the Times, The Boston Globe, the International Herald Tribune and 16 other daily newspapers.
That's steeper than the 11 percent reduction seen in the first six months of the year as the declining economy resulted in fewer retailers, auto dealers, real-estate brokers and employers willing to place ads.
But the Times bucked industry trends in reporting that ad sales fell 14 percent in September compared with last year, its lowest monthly drop since May. Other newspaper publishers have been reporting a sharper drop in September than in August.
Circulation revenue rose 1 percent in the third quarter, reflecting price increases at the flagship Times newspaper. Last year's decision to cease a paid online subscription product called TimesSelect contributed to a 5.4 percent drop in other revenue. Overall, revenue in the news media group fell 9.8 percent to $658 million.
The company's About.com Web sites saw a revenue gain of 16 percent to $28.7 million. Combined with the newspapers' Web sites, online revenue grew 6.7 percent to $85.1 million. But because Internet businesses accounted for just 12 percent of all revenue, the online gains were not enough to offset sharp declines in the print businesses.
Online advertising eased in the third quarter, and the company said the digital business was slowing so far in the fourth quarter as well, primarily because of less display advertising.
The growth rate for online advertising across the industry already has been slowing as the size of the pie gets larger, even when growth is steady in terms of dollars. But the weak economy has been adding pressure on growth.
In the third quarter, advertising and other online revenue at the company's digital operations grew just $5.4 million compared with a year ago, the lowest growth amount all year. The 6.7 percent growth rate is also lower than the 12.8 percent in the second quarter and the 11.6 percent in the first quarter.
On a month-to-month basis, the Times showed improvement in September. Its online revenue growth of 11.7 percent that month compares with 6 percent in August and 2.6 percent in July. But the Internet's share of all revenue fell to 12 percent in September, from 13.4 percent in June.
The Times said it reduced third-quarter operating costs across the company by 6.8 percent over last year, despite seeing newsprint prices rise 22 percent. Overall newsprint costs rose just 2.1 percent as the company reduced usage.
Job cuts earlier in the year helped reduce payroll costs, though the Times took an after-tax charge of $10.3 million, or 7 cents per share, for severance costs, about half of which related to the planned shutdown of a division that distributes newspapers and magazines to retail outlets in the New York area.
The company said it had debt of about $1.1 billion.
For the first nine months of the year, the company had net income of $27.3 million, or 19 cents a share, down 82 percent from $156 million, or $1.08 a share, in a year-ago period boosted by the sale of its broadcast unit. The company had $2.18 billion in revenue, down 6.5 percent from $2.33 billion last year.
Times shares rose 9 cents to $10.77 in late morning trading after sinking to a 52-week low of $10.39 earlier in the sesion.
http://biz.yahoo.com/ap/081023/earns_new_york_times.html?.v=3

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Blogosphere reactions to NYT Q3 results

The Death of the NYT (24/7 Wall St)
It is astonishing, but even the online revenue at the newspaper operations of The New York Times Company (NYT) has stopped growing rapidly. It is almost certain that the newspaper group excluding internet revenue is losing of money.
The entire NYT across of of its businesses made hardly any money at all. Preliminary third-quarter operating profit decreased to $10.0 million from $28.1 million in the third quarter of 2007.
The NYT purchase of The Boston Globe has turned into a fiasco. It will write down the value of that property and some small properties in New England by as much as $150 million.
The company shaded its internet performance a little in its press release. Online advertising grew 10.2% in the quarter. In total, our online revenues now account for 12.4% of the company’s revenues. But internet sales as a whole grew by less. Total internet revenues increased 6.7% to $85.1 million from $79.7 million in the third quarter of 2007.
Total sales across all of the company's businesses fell 9% to $687 million.
Among the comments made by management:
“As part of our analysis of our uses of cash, we are evaluating future financing arrangements. Based on the conversations we have had with lenders, we expect that we will be able to manage our debt and credit obligations as they mature. Going forward, we plan to continue to explore opportunities to reduce our debt levels."
That would seem to mean the company has problems with its bankers.
"In addition, our Board of Directors plans to review our dividend policy before the end of this year to determine what is most prudent in light of the overall market conditions."
The means the founding Sulzberger family is going to start to run low on living expenses.
Results for the month of September, release separately, showed a 14% drop in newspaper ad revenue. Classified advertising across the division was off by almost 20%.
It would appear that the company's problems are beyond solving if it does not begin to sell some of its core assets.
Douglas A. McIntyre
http://www.247wallst.com/2008/10/the-death-of-th.html

How's that stock price taking the NYT Q3 results?

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Not happy with the NYT results? Fine, but what about your newspaper delivery?

I recently came across this blog. If you think this one is anal and obsessive, try this for size. It may already have run out of steam (last post, April 08) but you now know where to go to give vent to any complaints re. your NYT and indeed WSJ delivery.

New York Times (NYT) & Wall Street Journal (WSJ) Complaints
This Blog will be continually updated to reflect the views and opinions of myself and others who have had remarkably bad experiences with the New York Times or the Wall Street Journal newspaper. Send your stories to nyt.wsj@fastmail.net

The New York Times Company Reports Preliminary Third-Quarter Results

NEW YORK--(BUSINESS WIRE)--October 23, 2008
The New York Times Company announced today a preliminary third-quarter loss per share from continuing operations of $.01, including $.07 per share for severance costs, compared with $.10 earnings per share (EPS) in the third quarter last year, which included $.02 per share for severance costs.

Preliminary third-quarter operating profit decreased to $10.0 million from $28.1 million in the third quarter of 2007, while preliminary operating profit excluding depreciation and amortization decreased to $43.9 million from $79.9 million in the third quarter last year.

Preliminary results do not include an anticipated non-cash charge for impairment of goodwill and long-lived assets.

Due to the continued softening of business conditions driven by the secular forces affecting the newspaper industry, the Company is testing the assets of its New England Media Group for impairment in the 2008 third quarter.

While the results have not yet been finalized, the Company currently estimates a non-cash impairment charge of $100 to $150 million. The Company will record the charge in its financial statements when it files its third-quarter Form 10-Q with the Securities and Exchange Commission. The charge will affect EPS for the third quarter but will not affect the Company's operating cash flow.

"The impairment charge reflects the decrease in print advertising revenues stemming from the secular changes in the media industry," said Janet L. Robinson, president and CEO. "It does not, however, affect our cash flow or our long-term strategy of becoming an increasingly digital organization.

"The decline in print advertising revenues this quarter accelerated as the economy slowed. The U.S. presidential election and the turmoil in the world's financial markets have again demonstrated the need for the high-quality journalism we provide in print and online. The continued strength of our brands is evident in our ability to raise home-delivery and newsstand prices, which resulted in an increase in our circulation revenues. It is also reflected in the strong growth in traffic to our Web sites, which increased 15 percent in September. Online advertising grew 10.2 percent in the quarter, in part due to the introduction of new ad formats. In total, our online revenues now account for 12.4 percent of the Company's revenues.

"As we continued our drive to reduce expenses, operating costs decreased 6.8 percent compared with the same quarter last year, despite a more than 20 percent increase in the price of newsprint. Given the adverse economic conditions, we will continue our strict cost discipline.

"In this difficult environment, we are reviewing our uses of cash. We have reduced our estimate for capital expenditures in 2008. Next year we expect they will decline from their 2008 level and be approximately $80 million. In addition, our Board of Directors plans to review our dividend policy before the end of this year to determine what is most prudent in light of the overall market conditions.

"As part of our analysis of our uses of cash, we are evaluating future financing arrangements.

Based on the conversations we have had with lenders, we expect that we will be able to manage our debt and credit obligations as they mature.

Going forward, we plan to continue to explore opportunities to reduce our debt levels.

"As we move into the fourth quarter, our visibility on advertising revenues is limited. To date in October, print advertising revenue declines are similar to those in September but we are seeing slowing in digital advertising revenues, mainly because of less display advertising.

We remain committed to executing our strategy of developing new revenue streams for both our print and online products, reducing costs, making full use of our R & D capability and rebalancing our portfolio of businesses."

Third-Quarter ResultsComparisons
All comparisons are for the third quarter of 2008 to the third quarter of 2007. The results of the Broadcast Media Group, which was sold in the second quarter of 2007, are reported within discontinued operations. Net income from discontinued operations of $8.6 million ($.06 per share) in the third quarter of 2008 was due to a reduction in income taxes on the gain on the sale, and the net loss from discontinued operations of $0.7 million ($.01 per share) in the third quarter of 2007 was due to post-closing adjustments to the gain.
This release includes non-GAAP financial measures, and the exhibits include a discussion of management's use of these non-GAAP financial measures and reconciliations to the most comparable GAAP financial measures.

Revenues

Total revenues decreased 8.9 percent to $687.0 million from $754.4 million.

Advertising revenues decreased 14.4 percent;

circulation revenues increased 1.0 percent;

and other revenues declined 4.2 percent.

Revenues decreased mainly due to lower print advertising.

Operating Costs

Operating costs decreased 6.8 percent to $677.1 million from $726.3 million.

Depreciation and amortization decreased 34.6 percent to $33.9 million from $51.8 million last year, when accelerated depreciation totaled $11.7 million ($6.7 million after tax, or $.05 per share) for assets at the Edison, N.J., printing plant, which the Company closed earlier this year. There was no accelerated depreciation in the third quarter of 2008.

Excluding depreciation and amortization and severance costs, operating costs decreased 6.6 percent to $625.1 million from $669.6 million, mainly due to lower compensation costs and benefits expense.

Compensation costs declined primarily as a result of lower incentive compensation and a reduced workforce in the third quarter of 2008 compared with the same period last year.

Benefits expense decreased due in part to lower workers' compensation expense and lower pension and other postretirement expense.

Newsprint expense increased 2.1 percent, stemming from a 22.1 percent increase in prices, offset in part by a 20.0 percent decrease in consumption.

Severance costs were $18.1 million ($10.3 million after tax, or $.07 per share), about half of which was for the shutdown of City & Suburban (C & S), the Company's retail and newsstand distribution subsidiary, which operates in the New York metropolitan area. The closure of C & S is expected to be completed in January 2009, and additional severance costs may be recorded before it is closed. In the third quarter of last year, the Company had $4.9 million ($2.8 million after tax, or $.02 per share) in severance costs.

Third-Quarter Business Segment Results

News Media Group

Total News Media Group revenues decreased 9.8 percent to $658.3 million from $729.6 million.

Advertising revenues decreased 15.9 percent due to weakness in print advertising at all of the Company's major properties. In particular, classified advertising revenues decreased across the News Media Group.

Circulation revenues increased 1.0 percent, mainly because of higher prices for The New York Times, partially offset by volume declines. In July and August, The New York Times announced newsstand and home-delivery price increases.

Other revenues decreased 5.4 percent to $61.0 million from $64.5 million primarily because of the elimination of subscription revenues for TimesSelect, an online product offering that was discontinued in September 2007.

Total News Media Group operating costs decreased 6.5 percent to $651.2 million from $696.5 million. Excluding depreciation and amortization and severance costs, operating costs decreased 6.5 percent to $604.1 million from $646.0 million, mainly as a result of the items noted in the operating costs section above.

Operating profit for the News Media Group decreased 78.6 percent to $7.1 million from $33.1 million. Excluding depreciation and amortization, operating profit for the News Media Group decreased 53.9 percent to $36.5 million from $79.2 million.

About Group

Total About Group revenues increased 16.1 percent to $28.7 million from $24.7 million due to increased cost-per-click and display advertising.

Total About Group operating costs decreased 2.8 percent to $17.9 million from $18.4 million.

Excluding depreciation and amortization, operating costs increased 5.6 percent to $15.3 million from $14.5 million, mainly because of investments in new revenue initiatives that resulted in higher professional fees. Depreciation and amortization was lower, primarily because an asset reached the end of its amortization period in the second quarter of 2008.

Operating profit grew 71.4 percent to $10.8 million from $6.3 million.

The operating profit margin improved significantly because of increased advertising as noted above and lower depreciation and amortization.

Operating profit before depreciation and amortization rose 31.0 percent to $13.4 million from $10.2 million, mainly due to higher revenues.

Corporate

Corporate costs decreased 30.3 percent to $7.9 million compared with $11.3 million in the prior-year third quarter mainly due to lower professional fees and compensation costs.

Other Financial Data

Internet Revenues
In the third quarter, the Company's Internet revenues increased 6.7 percent to $85.1 million from $79.7 million in the third quarter of 2007, and Internet advertising revenues grew 10.2 percent to $74.4 million from $67.5 million.

Internet businesses include NYTimes.com, About.com, Boston.com and other company Web sites. In total, Internet businesses accounted for 12.4 percent of the Company's revenues in the third quarter versus 10.6 percent in the 2007 third quarter.

Joint Ventures
Net income from joint ventures was $12.5 million compared with $5.4 million. Higher earnings resulted from stronger performance at most of the properties in which the Company has equity interests.
Interest Expense-net
Interest expense-net increased to $11.7 million from $10.5 million, as a result of less capitalized interest.
Income Taxes
The Company's income tax expense of $12.8 million was larger than pre-tax income of $10.8 million in the third quarter. Income taxes were unfavorably affected by non-deductible losses on investments in corporate-owned life insurance policies and a change in Massachusetts state tax law. The effective income tax rate in the third quarter of last year was 39.0 percent.

Cash and Total Debt
At the end of the quarter, cash and cash equivalents were approximately $46 million and total debt was approximately $1.1 billion. The Company's current source of short-term funding is its revolving credit agreements under which it had approximately $398 million in borrowings outstanding at the end of the quarter.

Capital Expenditures

In the third quarter, total capital expenditures were approximately $27 million. Year to date, capital expenditures totaled approximately $95 million.

Expectations

Below are updated expectations on key items for 2008 unless otherwise noted.

-- Cost savings and productivity gains - Previously the Company said it believed that it would achieve a reduction in costs from its year-end 2007 cash cost base of a total of more than $230 million in 2008 and 2009, excluding the effects of inflation, severance costs and one-time costs. More than $130 million of these savings were expected in 2008. As a result of the Company's continuous cost reduction efforts, it now expects to exceed the $130 million and $230 million targets by even larger amounts. Therefore, the Company will stop measuring its cost savings against these targets. The Company continues to explore a wide range of additional cost reduction initiatives, and as they develop, details will be provided.

-- Depreciation and amortization - $145 to $155 million, which includes approximately $5 million of accelerated depreciation expense in the first quarter of 2008 associated with the New York area plant consolidation project. Depreciation for the new headquarters building is expected to be $7 million per quarter.

-- Income from joint ventures - $20 to $25 million.

-- Interest expense - $49 to $53 million.

-- Income tax rate - Previous guidance was 40% to 43%. Due to the significant volatility in the quarter to quarter tax rate, the Company no longer plans to give tax rate guidance.

-- Capital expenditures - $140 to $145 million. Previous guidance was $150 to $165 million, including approximately $35 million for the consolidation of the Company's New York area plants and about $22 million for its new headquarters. For 2009, the Company expects capital expenditures to be approximately $80 million.

-- Severance - Previous guidance was $40 to $50 million. Year-to-date severance costs are approximately $57 million, which is higher than previous guidance because of the severance costs associated with the closure of C & S. Additional amounts may be recorded for C & S before it is closed. Due to the uncertainty of the amount of possible severance costs, the Company is not providing updated guidance at this time.

Conference Call Information
The Company's third-quarter earnings conference call will be held on Thursday, October 23, at 11:00 a.m. E.T. To access the call, dial 877-741-4245 (in the U.S.) and 719-325-4830 (international callers). Participants should dial into the conference approximately 10 minutes before the start time. Online listeners can link to the live webcast at www.nytco.com/investors.

An archive of the webcast will be available beginning two hours after the call at www.nytco.com/investors, and a transcript of the call will also be posted. The archive and transcript will be available for one quarter.

An audio replay will be available at 888-203-1112 (in the U.S.) and 719-457-0820 (international callers) beginning approximately two hours after the call until 5 p.m. E.T. on Friday, October 24. The access code is 4044846.

Except for the historical information contained herein, the matters discussed in this press release are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from those predicted by such forward-looking statements. These risks and uncertainties include national and local conditions, as well as competition, that could influence the levels (rate and volume) of retail, national and classified advertising and circulation generated by our various markets and material increases in newsprint prices. They also include other risks detailed from time to time in the Company's publicly filed documents, including the Company's Annual Report on Form 10-K for the year ended December 30, 2007. The Company undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise.

Exhibits: Preliminary Condensed Consolidated Statements of Income
Preliminary Segment Information
News Media Group Revenues by Operating Segment
Footnotes
Preliminary Reconciliation of Non-GAAP Information
This press release can be downloaded from http://www.nytco.com/

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