Lee Enterprises has received a warning from the New York Stock Exchange about its stock listing and the possibility about its listing being downgraded.
Lee, the Davenport-based parent company of the Quad-City Times, Dispatch-Argus and Muscatine Journal, said Monday that it received a warning from the NYSE about being non-compliant with certain listing standards, according to a news release.
The New York Stock Exchange alerted Lee on May 12 about falling out of compliance on two factors, including having an average closing price of less than $1 over a 30-day trading period. The media company will have six months from July 1 to remedy the situation.
Its stock will continue trading, and has been under $1 since March 31. The NYSE also found the total dollar value of Lee's stock was under $50 million for a 30-day period, which can be remedied within 18 months of July 1.
This comes on the heels of Lee disclosing in a May 8 Securities Exchange Act filing that it would not report its earnings for the quarter that ended March 29 on May 8 as scheduled. It plans to release details from the financial quarter on or before June 22 that would include its March 16 acquisition of Berkshire Hathaway Media Group and The Buffalo News.
That acquisition restructured Lee’s debt, and Berkshire Hathaway became the sole lender of Lee’s debt.
Kevin Mowbray, president and CEO of Lee Enterprises, said in a news release that he expected the company’s advertising revenue to be significantly impacted by the ongoing COVID-19 pandemic.
“The size and engagement of our audience during this time underscores the vital role we play in the communities we operate. We are focused on continuing to deliver outstanding local news coverage that our readers trust and maintaining strong partnerships with our advertisers, keeping communities informed and engaged,” he said.
Lee Enterprises said 43% of its revenue was subscription-based, which has been less affected by the new coronavirus than advertising revenue, of which 47% is from local retailers.
The company has taken cost-reduction measures in the wake of the pandemic, such as cutting the pay for executives and the board of directors and all employees taking on pay reductions or furloughs of two weeks.
Lee Enterprises says those moves will reduce operating expenses by nearly $10 million this fiscal quarter.
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