October 31, 2008
Dear Lee Employee:
Like many other businesses and media companies, Lee has been battered by the unprecedented economic turmoil and credit crisis. Consumers are suffering and spending less, which means our advertisers are suffering and spending less. As a result, our revenue and earnings have fallen.
While we believe that the economy will improve and that Lee will emerge strong, no one can predict when the upturn will begin. Until it does, we must protect our financial health by reducing spending even more while continuing to drive revenue as aggressively as we can.
Until economic conditions improve, the company’s profit-sharing contribution to most employee 401(k) retirement accounts is being suspended beginning in December. Also, the company’s match to employee contributions is being reduced. For most employees, the reduction is half of the current levels.
We regret having to take these steps and look forward to the time when these benefits can be reinstated.
As you know, significant expense cuts have already been made in all areas of our business. In addition, executive pay has been frozen, corporate executive bonuses have been suspended for the full year, and future stock grant programs have been suspended. Also, we have renegotiated credit terms with our lenders and suspended stockholder dividends.
Thank you for all you do for Lee. I am grateful for your perseverance in this extraordinary time of challenge.
We’ll get past this. In the meantime, I think it helps to remember how vitally important our newspapers and websites are in the communities we serve. No competitor comes close to providing the value we do for readers and advertisers, and our audiences continue to grow.
With appreciation and best regards,
Yesterday, Lee announced it would suspend its dividends.