Osprey continues to struggle with ads and unit value

Osprey Media Income Fund, an owners of small daily and weekly newspapers and small magazines, has written down about$170 million of its value, blaming a slumping advertising market, particularly automotive.

The company has seen the price of its units steadily erode, threatening its ability to make the kinds of distributions that keep people happy with income trusts. Last fall, the value of its units fell by 15% when the federal government announced that such trusts would be taxed, starting in 1011. Yesterday, the value of the units was $5.73, which is half what they once were. So far, the company is still paying out about $0.64 cents a unit, but there is some question about how long that can continue, given the 2006 loss of $113.4 million.

Osprey president and CEO Michael Sifton shone the brightest light he could on the situation by noting that the company had been able to post revenue growth of $7.2 million, or about 3.4 per cent for the year.

See earlier post about this company.