More Bad News for Seattle Times Backer McClatchy

McClatchy, a Sacramento-based company with a 49.5 percent stake in the Seattle Times Co., blames its serious hit to revenues over the last year in part on the Times' payout on the settlement of its joint operating agreement with the Hearst Company, owner of the Seattle P-I.

McClatchy’s net income thus far in 2007, announced today, is off by about 32 percent from where it was last year. Among the losses suffered thus far was a $4.7 million payment to Hearst made by the Times as part of the settlement agreement.

In an accompanying press release, McClatchy CEO Gary Pruitt notes, "We recognize that newspaper revenues have declined and that values have dropped." McClatchy is still profitable, but Pruitt's words are ominous for anyone in my line of work, especially if his company is your biggest source of funding.