Media General

Media General President & CEO Morton to retire

Marshall N. Morton will step down as CEO of Media General at the end of 2012, the company announced Wednesday. George L. Mahoney will replace him. Mahoney, the company’s release says, “has been responsible for Media General’s digital media and mobile operations, including content initiatives that attract new audiences to all of the company’s platforms and programs to create new revenue streams.” Morton has been with the company for 23 years.

Media General sold all but one of its newspapers to Warren Buffett’s Berkshire Hathaway in May, a deal that refocused the company as primarily a broadcast-television concern and allowed it to refinance its very large debt. Last month the company reported dramatically higher revenue and laid off 75 employees.

“Media General has a very promising future as a television broadcaster, with our portfolio of top ranked stations located in attractive markets,” Mahoney said in the press release. Read more


Media General lays off 75 employees

Jim Romenesko
Media General President and CEO Marshall Morton tells staffers the reductions, announced Tuesday, are because “the resources that were necessary to support our larger organization are not justifiable in our smaller, more focused company.”

When we sold our newspapers last month, we changed from a company with revenues of $616 million in 2011 and approximately 4,000 employees to one that will have revenues this year of about $350 million and about 1,400 employees working at our television stations.

Media General sold all but one of its newspapers to Warren Buffett’s Berkshire Hathaway in May. As part of the deal, Buffett loaned the company $400 million to restructure its crushing debt.

The layoffs, Morton wrote in his memo to staff, are coming in “corporate staff departments and in the digital media section of the Growth and Performance group.” Most employees will be terminated as of today. Read more


Media General reports income increase, net loss in second quarter

Media General
Operating income was up 164 percent at Media General in its second quarter, the company announced today. It attributed the rise to political advertising and retransmission fees, which were up 80 percent. On its balance sheet, the company categorizes the Tampa Tribune, its only remaining newspaper property since it sold most of its newspapers to Berkshire Hathaway in May, as “discontinued operations,” a category that also includes and a broadcast equipment business. (The Poynter-owned Tampa Bay Times competes with the Tribune.) “Media General is in discussions with prospective buyers for The Tampa Tribune and its associated print and web operations and believes a sale is probable,” the company says in a release. Read more


2011 busiest year for newspaper ownership changes since 2007

Project for Excellence in Journalism | The Wall Street Journal
The last 18 months have been “a period of intense change in U.S. newspaper ownership,” reports PEJ in the summary for its report “Who Owns the News Media.” Companies like Media General and Freedom Communications have ended decades of newspaper ownership (or nearly so; Media General has one paper left) as new players like private investment firms have expanded their holdings. “A total of 71 daily newspapers were sold as part of 11 different transactions during 2011,” PEJ says of those sales and the ones so far this year:

Most of the sale prices in these transactions speak to continued softening of the newspaper market. The New York Times Company Regional Group papers were sold for a total of $143 million.

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Media General execs realized in 2011 newspaper decline wasn’t cyclical

Richmond BizSense
Media General President and CEO Marshall Morton tells Michael Schwartz that the company didn’t realize until 2011 that its newspaper revenue declines were not simply due to the recession:

“Over the past five years, our first thought was that this was heavily due to the recession and, like many other recessions in the past, that this was a cycle. You tighten your belt, freeze hiring and even drop the number of people.

“So we went through a couple years thinking that was the way to handle it. But it kept going.”

It wasn’t until the second quarter of 2011, Morton says, “that we realized the world had changed.”

Morton says the company had considered selling its papers for months, but the deal with Berkshire Hathaway to buy most of its newspapers came together over a matter of days. Read more


Warren Buffett not yet done buying newspapers after purchasing 63 from Media General

Warren Buffett, whose Berkshire Hathaway is buying 63 Media General newspapers, told the Omaha World-Herald, which he also owns, he’s not planning any future newspaper purchases, but he’d consider them:

“There aren’t a lot of buyers in the field whose checks will clear. … Any time we can add properties we like, to management we like, at a price we like, we’re ready to go.”

These purchases are not sentimental, said Wally Weitz.

“When it comes to Media General, it’s going to be all business,” Weitz said. “As a Berkshire shareholder, I have to assume that he knows more about investing in newspapers than anybody else, and he’s had decades of recognition that the business has changed and it’s not what it used to be.

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Media General, Warren Buffett agree on paywalls

Warren Buffett, whose Berkshire Hathaway bought most of Media General’s newspapers Thursday, thinks paywalls are one of the few defenses newspapers have against the economic forces that are battering them. In an interview on CNBC in February, Buffett said, “It’s expensive to turn out a paper. You start with trees up in Canada and you end up with a kid throwing it.”

Newspapers “have been giving away their product at the same time they’re selling it,” he said, “and that is not a great business model. When they put papers up on the Internet and you get free, you’re competing with yourself. And throughout the industry you’re seeing a reaction to that problem and an answer to it. … You shouldn’t be giving away a product you’re trying to sell.”

Media General’s 2011 annual report said the company was moving toward paywalls at all of its papers: Read more


Investment adviser: Media General’s leadership ‘still the worst management team around’

Amit Chokshi is the founder and owner of Kinnaras Capital Management, and he’s been a constant pain in the collective neck of Media General’s management over the past few months. Many of his beefs with Media General’s leadership are summed up in a March 14 post: The bosses “missed a massive refinancing window in early 2011, costing investors potentially $15-20+MM in additional interest expense”; they have “no accountability, with the management team enjoying egregious compensation at shareholders’ expense”; and “Management appears aware of its own incompetence as illustrated by the lack of insider purchases irrespective of Media General’s price and valuation.” (For other criticism, see: 1, 2, 3.)

Reached by telephone Thursday, Chokshi says “everybody got lucky” with the deal announced today whereby Berkshire Hathaway will buy Media General’s newspapers and help pay off its onerous debt. Read more

The picture of Berkshire Hathaway Chairman and CEO Warren Buffett is seen in a newspaper in Omaha, Neb., Saturday, May 1, 2010, as shareholders pack the Qwest Center arena well ahead of the shareholders meeting start time. (Nati Harnik/AP)

Media General to sell most of its newspapers to Warren Buffett’s Berkshire Hathaway

Marketwatch | Omaha World-Herald | Richmond Times-Dispatch
When Warren Buffett said earlier this month that his Berkshire Hathaway might be buying more newspapers, he meant: right now. Media General announced this morning that it would be selling its newspapers, except its Tampa properties, to Berkshire Hathaway. The Tampa properties, which compete with Poynter’s Tampa Bay Times, are being considered by another company, according to the press release. Halifax Media is a likely contender for the Tampa papers, as it now owns other papers nearby after buying 16 regional papers from the New York Times Company.

Media General announced in February that it was exploring the sale of its papers. During an April conference call about its first quarter results, CEO Marshall Morton said, “Our future is as a broadcast and digital company.”

Media General will receive $142 million cash for its 63 papers and a $400 million loan that will allow the company to pay off its debt, which was becoming increasingly problematic. Read more


Pay drops (you read that right) for Media General executives

Winston-Salem Journal | Citybizlist
Cynical journalists (those of you who are left), take heart: This is not a post about a news company executive getting a $500,000 bonus as her newspapers lay off employees. That was last week. Nor is it about an executive getting a $4.4 million severance package after overseeing a shrinking newspaper division that cut jobs and closed a major newspaper. Again: last week. This week, Media General reports that CEO Marshall Morton’s income dropped 38 percent from 2010 to 2011, according to Citybizlist. The big reason: He didn’t receive any stock awards. His salary also dropped 6 percent due to a companywide, 15-day furlough. (He still made $1.44 million, more than he did in 2009.) “For the fourth consecutive year, none of the top six executives received money from the company’s annual incentive plan,” reports the Winston-Salem Journal’s Richard Craver. Read more

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