Wednesday, January 20, 2010

Tribune Sees 2009 Cash at $500 Million, Topping Prior Estimate

By Greg Bensinger
Business Week

Jan. 20 (Bloomberg) -- Tribune Co., the publisher of the Los Angeles Times and Baltimore Sun, said it is likely to report 2009 operating cash flow of $500 million, that's double what Tribune had estimated coming into the year. Tribune had upgraded expectations in November, estimating end of the year cash flow at $400 million two months ago.

Improved results from the broadcast and publishing units during the fourth quarter helped boost the Chicago-based company’s cash flow, according to a memo sent to employees by Chief Executive Officer Randy Michaels and Chief Operating Officer Gerry Spector.

"We're still going through the numbers, but thanks to a stronger than expected performance by both the Broadcasting and Publishing Groups in the fourth quarter, it appears we will finish the year with close to $500 million in operating cash flow," the memo said. "Given that we started the year like most media companies, feeling as though we would be fighting for our very survival, this is truly a remarkable achievement."The two thanked employees for their hard work, and keeping expenses low -- but warned that tight times will continue: "We'll still have to keep our expenses in check and be as efficient as possible, but we're optimistic about where we're headed. It’s unclear whether these trends will continue, so we’ll have to work even faster in 2010,” Michaels and Spector said in the memo.

The company has been doing a number of things to keep expenses down, including selling 95 percent of the Chicago Cubs and the iconic Wrigley Field for about $845 million to the Ricketts family in August.

Earlier this month, the Tribune’s LA Times cut 80 jobs as it closed an Orange County printing plant. In addition, the paper said it would shrink the width of the newspaper to 44 inches from 48 inches. In November, the Tribune suspended its Associated Press news feed across its dailies to see if it could do without the wire service

Tribune filed for bankruptcy protection in December 2008, one year after a group led by billionaire Sam Zell took the company private in a deal that saddled it with about $13 billion in debt. The company, also owner of the Chicago Tribune, may emerge from bankruptcy by the end of March, Zell has said.

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