$1.2 billion debt paydownSurprised that they have already bought back $700 million in debt and now will buy back another $500 million.
Total interest charges of about $100 million per year of which about $60 million is already adding to free cash flows.
The dividend drop will add another $80 million to cash flows to the $260 million already added by the earlier decrease in the dividend.
Total gains in operating cash flows will be about $440 million per year of which nearly $400 million is already being generated.
In the first 6 months, YLO generated $199 million in cash flows or about $400 million per year.
Knock off 10 % for revenue declines and the total cash flows for 2011 would have been about $360 million.
With these changes , that will now increase to about $750 million per year.
Even with a 10 % decline per year, YLO should be able to generate over $600 million in cash flows for 2012.
The cash payment of $25 million per quarter is therefore easily sustainable.
This must be the last of the bad news overhang.
But, this large debt paydown substanhtially reduces the risk of bankruptcy and a chance for the growth in the digital business to reduce the drag of the print business.