Gannett (GCI) - Get Report, parent of USA Today said Wednesday that it was suspending its dividend and planning job cuts, pay reductions and other actions in an effort to preserve liquidity as the coronavirus pandemic stifles the economy.
Shares were climbing 8.1% to $1.60 in premarket trading Wednesday.
"While business performance started the year strong, we now expect our revenues to be significantly impacted by the Covid-19 pandemic," Michael Reed, chairman and CEO, said in a statement.
Gannnett said it expects advertising and events revenue to fall as a result of widespread business closures and social distancing measures.
The McLean, Virginia-based media company had said in February that it planned to resume paying a quarterly dividend of 19 cents a share, but "in light of the unprecedented economic disruption and uncertainty caused by the pandemic," the board decided to suspend the dividend until economic conditions improve.
Gannett last paid investors a quarterly dividend of 38 cents a share on Nov. 12, 2019.
Gannett said it expected to reduce expenses this year by $100 million to $125 million in addition previously planned reductions tied to the merger of New Media Investment Group through job cuts, furloughs, pay reductions for senior management, and cancellation of non-essential travel and spending.
The company is also looking to delay capital expenditures and working with vendors, creditors, and pension regulators to restructure or postpone certain obligations.
Regarding post-merger integration, Gannett said it remains "highly confident in our previously announced goal of implementing measures by the end of 2021 to achieve $300 million in annualized synergies, with more than half of such measures expected to be implemented in 2020."