Gannett To Freeze Pension Plan Contributions

SAN FRANCISCO (Dow Jones)--Gannett Co. (GCI), the newspaper company that owns USA Today and about 80 other daily newspapers, Wednesday said it planned to freeze its pension plan contributions, beginning in August, a move designed to save $90 million.

A spokeswoman for Gannett said the company plans to reinvest $60 million of the savings into employee 401k plans and keep the remainder as a saving for the company.
The freeze is yet another example of the struggles newspaper companies are facing as more readers turn to other sources, like the Internet, for their news.
According to Gannett's annual report, the company recorded total pension costs of $54.3 million in 2007, down 47% from its 2006 total of $102.7 million. The plan has total assets of about $3.4 billion.

Gannett on Monday said it planned to write down its asset value by as much as $3 billion in an impairment charge, reflecting roughly 19% of the McLean, Va., company's assets.

Most of the write-down stems from tougher economic conditions facing Gannett's U.K. newspapers unit Newsquest, where a real-estate downturn is hurting newspaper advertising revenues.

Shares in Gannett, in common with many newspaper stocks in the U.S. and the U.K., have been battered by advertising revenue declines, more than halving over the past year.

Shares were down 1.9% to $25.99 on Wednesday.