Friday, April 24, 2009

Story of the Week

It's tough choosing between these two:

The Business Insider, April 21st:
As expected, the New York Times's business operations began burning cash this quarter (until now, they had remained cash-flow positive). The company has recently made several wise moves that have postponed the date at which it will run out of cash. But the situation is still critical.

At the current rate of cash consumption, assuming no one-time expenses (highly unlikely), we estimate that the company will max out its current borrowing capacity in 4 quarters. At that point, it will owe about $1.2 billion in debt. This estimate does not include any payments on the company's $600+ million pension and benefit obligation, of which $181 million is due next year.

The bottom line: The New York Times Company remains on the brink of insolvency. There are also at least $1.5 billion of claims ahead of common shareholders of the company's assets should it file for bankruptcy.
Thomas Edsall on The Puffington Host, April 22nd:
At a time when New York Times managers are forcing all employees to take a five percent pay cut, and demanding even larger sacrifices from the NYT-owned Boston Globe, top executives of the beleaguered newspaper received substantial bonus and fringe benefit payments over and above their salaries, according to a proxy statement released on March 11.

These bonuses and benefits to top Times company executives have provoked growing resentment among Times staffers, and frank anger from Globe reporters who have been warned by Times executives that their paper will be folded if they do not come up with $20 million in pay cuts and layoffs. . .

According to the New York Times proxy statement filed with the Securities and Exchange Commission, corporate president and CEO Janet L. Robinson received a total compensation package valued at $5.58 million in 2008, up well over a million from the $4.14 million she received in 2007, and the $4.4 million she received in 2006.

Robinson's $1 million base salary has remained the same for three years. In 2008, Robinson's total compensation included, in addition to her base salary: $1.6 million in stock awards, $1.5 million in options, a $35,000 bonus, $562,500 from the non-equity incentive plan, $898,171 from the "Change in Pension Value and Non-qualified Deferred Compensation Earnings," and "other compensation" of $46,368.
I thought about setting up one of those poll-thingies to let readers vote, but I never learned how to code polls. Besides, why choose when the Schadenfreude is sublime in both?

(via Tigerhawk, Half Sigma)

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