DAVENPORT, IOWA – The company that owns the Mason City Globe Gazette continues to suffocate under crippling debt of over $650 million.
As of March 27, 2016, the principal amount of debt for Lee Enterprises was $656.5 million, the company’s financial officer revealed in a press release today. Lee has been struggling to overcome this debt for years, ever since it purchased the St. Louis Post-Dispatch and made other moves. It filed for Chapter 11 bankruptcy protection to refinance nearly $1 billion in debt back in 2011.
Lee revealed that its subscription revenue decreased 3.0% in recent weeks, as price increases did not offset paid subscriber losses, and average subscription rates increased for the period.
In a sign of bad news for its work staff, employee compensation decreased 3.9%, primarily as a result of reduced staffing levels. Locally, a current Globe Gazette employee told NIT this week – over a beer at Sportsman’s Lounge – that he is totally disillusioned with his job there and plans to quit very soon. He revealed that he “gave up” trying to get the Globe to cover news in an unbiased way as the Globe pumped out positive (some called it completely slanted) news almost everyday on the Prestage hog plant fiasco.
Meanwhile, newsprint and ink expense decreased 21.0%, primarily the result of lower newsprint prices and a reduction in newsprint volume of 11.9%. The Globe Gazette sunk $2 million into a behemoth, used printing press in 2014, even as many people refuse to buy or subscribe to print newspapers. The Globe employee who spoke to NIT said its circulation numbers are “way down” and “not even close to what they tell people”.
Lee reported that much of its sales efforts are spiraling down rapidly, as this quarter’s advertising and marketing services revenue combined decreased 9.5% to $88.7 million, with retail advertising down 8.8%, classified down 14.0% and national up 0.5%.
Lee claims its “digital revenue” is “growing” and attracts “millions” of views, though.
