By: Mark Fitzgerald
Morris Publishing Group LLC said in a Securities and Exchange Commission (SEC) that it swung to a profit in 2009 even as it negotiated a prepackaged bankruptcy with lenders and revenues fell about 20%.
In the SEC, the parent of The Florida Times-Union in Jacksonville and a dozen other dailies said it needed additional time to file its required 10-K annual report for 2010 “to consider and determine the impact of Morris Publishing’s consummation of a prepackaged plan of reorganization under Chapter 11 of the Bankruptcy Code on March 1, 2010 and whether a going concern qualification is appropriate.”
In previous reports to the SEC, Morris said its auditors had expressed concerns about whether the company could continue as a going concern.
Morris said it anticipates the 10-K will report “significant declines in net operating revenues (approximately 20%) as compared to 2008, significant reductions in operating expenses (especially since a significant write-down of goodwill occurred in 2008), and positive income from continuing operations for 2009 as compared to a significant loss from continuing operations in 2008 (again, due to a significant write-down of goodwill in 2008).”
Morris emerged from bankruptcy last month under a reorganization plan that reduced its debt to approximately $107 million from $418 million. Morris swapped $100 million of new second lien secured notes due in 2014 for the cancellation of about $278.5 million of outstanding senior subordinated unsecured notes that were due in 2013.
At the same time, entities owned and controlled by the Morris family made a capital contribution of approximately $85 million and paid down intercompany debt amounting to about $25 million. The effect was to cancel about $110 million of Morris Publishing’s senior secured debt.