Hosting a second-quarter lender conference call Tuesday on Tribune Co.’s most recent earnings report, Sam Zell, company chairman and chief executive officer, said that despite economic headwinds and a 15 percent drop in print advertising revenue, the company continues to meet its debt requirements.
The Tribune Co., which owns The Baltimore Sun, 10 other dailies and 23 broadcasting stations, paid off $807 million in debt this year on one credit facility and owed it another $593 million by June.
Zell, whose report was bleak except for a 4 percent advertising revenue increase in the company’s broadcast and entertainment area, credited this liquidity position to Tribune Co.’s recent, majority interest sale of Newsday to New York’s Cablevision Co. for $650 million and to its recent commercial paper offering.
“Our industry continues to deal with the short-term effects of a weak economy and the long-term impact of advertising migration to the Internet,” Zell said.
Chief Operating Officer Randy Michaels said that redesigned formats at The Baltimore Sun, The Orlando Sentinel, the (South Florida) Sun Sentinel and the Allentown Morning Call were now in place and that “they’re better papers produced by a smaller staff.” Tribune has cut 930 positions companywide, but added 400 new positions, the company said.
In January, Zell orchestrated the privatization of the communications giant for $315 million of his own money, leveraging $8.2 billion in new debt to do so.
Some $10.6 billion of guaranteed debt remains to be paid, according to Tribune Co. Chief Financial Officer Chandler Bigelow.
Tribune Co. is still exploring ways to sell its Chicago Cubs baseball team and stadium, as well as its iconic Tribune Tower and Times-Mirror Square real estate holdings in Chicago and Los Angeles, respectively.
