Pinched Daily Record owner faces restructuring

The Dolan Co., owner of The Daily Record in Baltimore, has signaled financial distress by hiring a restructuring officer, deciding against paying a dividend and disclosing that it received a warning from the New York Stock Exchange over its low stock price.

The Minneapolis-based professional services and business information firm made all three announcements in the last several weeks. Dolan said its new chief restructuring officer, Kevin Nystrom of Zolfo Cooper, will work to "stabilize" its finances.

Dolan said Monday that it amended a credit agreement in a deal that, among other moves, "temporarily waives the company's default with respect to certain covenants and obligations." That amendment required Dolan to hire a chief restructuring officer.

Dolan said Jan. 2 that it received a continued listing standards notice over its stock price because the New York Stock Exchange requires an average closing price of at least $1 a share over a 30-day trading period. The company's stock has traded under that mark since mid-November and fell to a low of 43 cents a share on Tuesday.

In December, Dolan said it would not pay a cash dividend on its 8.5 percent "Series B" cumulative preferred stock between Oct. 2 and Jan. 1 "to preserve capital."

The company declined to comment beyond its public announcements. It publishes more than 20 legal and business newspapers around the country, including the five-day-a-week Daily Record, which reported free and paid circulation of 5,500 in 2012.

The company reported a loss of nearly $28 million in the three months ending Sept. 30, down from a loss of $103.5 million a year earlier. Revenue fell to $35.5 million in that third quarter, down from $44.7 million. Dolan said it continues to see lower levels of public-notice advertising in its publications, but it added that it gained cash and cut back on losses by selling its mortgage-default processing operation.

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