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Pantagraph parent pays back some debt

Wed, 10 Oct 2012 14:22:33 CDT
By: Charlie Schlenker

The parent company of the Pantagraph Newspaper in Bloomington says it is a year ahead of schedule in reducing its debt. Lee Enterprises repaid more than $60 million in the budget year just ended. But, the company which owns 51 daily newspapers must be far more aggressive in repayment to meet its commitment going forward. Lee still owes more than $930 million to lenders over the next five years. That's more than $186 million per year. That amount is less than the $170 million in unlevered free cash the company recorded in a recent 12 month period. Lee says it will be allocating nearly all of its unencumbered revenue to debt service going forward. To accelerate its repayment, Lee did sell off some of its assets earlier in the year. The owner of the Pantagraph also says it plans to cut its cash costs by another 3-4% in the next fiscal year. It also will continue changing its business model by outsourcing printing. More than a third of Lee's printing is already non local and several papers including the Pantagraph are printed outside the company. Lee paid 16 million in taxes in the last two years. The company says it also hopes government rules on refinancing will let it get that money back and that Lee will have to pay little or no tax going forward, freeing up that amount for debt service.

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