Co. claims 'business as usual' despite new regime
In a sudden shift in the executive suite, Paxson Communications has named Richard Garcia to replace Tom Severson as chief financial officer.Garcia has served as VP, controller and chief accounting officer of Paxson since September, having joined the West Palm Beach, Fla.-based broadcaster from DirecTV Latin America. Company would not comment on what precipitated the shift, saying only that it would be “business as usual” under the new financial regime. Investors may have had other ideas, however, sending shares of the broadcaster-programmer down 5.88% in Tuesday trading to close at $3.68. But the move comes just weeks after Paxson was compelled by the SEC to restate financial results to correct improper accounting for several TV station acquisitions made between 1997 and 2000. The restatement had no impact on earnings. Paxson is still in the financial hot seat however, with a yawning $1 billion debt load and under pressure to find an investment partner or outright buyer. Paxson has recently also gone to great effort to try to reinvigorate its dormant and souring relationship with NBC, which it said will help develop new original programming ideas for the struggling Pax network while handling its upfront ad sales effort next month. NBC last year formally notified Pax it wants to exit its shareholding position in Paxson, though it may struggle to get its agreed-upon exit price of $550 million, given the broadcaster’s difficult financial position. Paxson owns some 63 TV stations while its family-oriented Pax TV network reaches some 89% of U.S. households. Company last week announced that its cost-cutting efforts had helped deliver positive cash flow and lower net losses for the fourth quarter and full year 2003.