McClatchy, publisher of the Fresno Bee and dozens of other newspapers nationwide, filed for Chapter 11 bankruptcy Feb. 13.
The filing will not immediately affect the publisher’s employees or its 30 newsrooms, which include the Fresno Bee and the Sacramento Bee, according to the Associated Press.
McClatchy received $50 million in debtor-in-possession financing from Encina Business Credit. The Sacramento-based publisher will use that, plus its regular cash flow, to continue to operate.
McClatchy also owns the Miami Herald, The Kansas City Star and the Charlotte Observer.
The company was founded in 1857, when it began publishing a four-page newspaper in Sacramento. The paper later became the Sacramento Bee.
“McClatchy remains a strong operating company with an enduring commitment to independent journalism that spans five generations of my family,” said Chairman Kevin McClatchy, descendent of company founder James McClatchy.
The publisher’s revenue has continued to decline in the past six consecutive years. McClatchy predicts fourth quarter revenues of $189.6 million, which is down 14 percent from last year. Its 2019 revenue is expected to have declined 12.1 percent from 2018.
McClatchy follows in the footsteps of other legacy newspaper companies who filed for bankruptcy to shed costs, which include Tribune and New Media/Gatehouse.
The filing is another sign of the financial struggles afflicting print journalism as it transitions into the digital age.
McClatchy said it’s digital-only subscription increases by almost 50 percent each year. With more than 200,000 digital-only subscribers, digital subscriptions now account for 40 percent of the publisher’s revenue.
“When local media suffers in the face of industry challenges, communities suffer: polarization grows, civic connections fray and borrowing costs rise for local governments,” McClatchy CEO Craig Forman said. “We are moving with speed and focus to benefit all our stakeholders and our communities.”