New York Times suspends dividend


Yesterday, The New York Times announced that it is eliminating its quarterly dividend. Following the announcement three months ago that the Times was reducing its dividend from 23 cents to 6 cents per share, this further eroded confidence in the company, dropping the stock's value from $3.71 to $3.51 per share.

At this point, it is worth noting that a share of stock in the Times is cheaper than a copy of its Sunday paper.

While six cents may not seem like much, those pennies are very significant for the Ochs-Sulzberger family, which controls the Times and receives most of its income (over $25 million annually) from stock dividends. However, the combination of declining ad revenues and over $1 billion in debt has crippled the paper. The decision to eliminate the dividend will save the Times $35 million; combined with the previous reduction, this number jumps to $133 million annually.