2019-02-12 23:34:01 UTC
The publisher of the National Enquirer, currently under attack by Amazon.com
Inc. founder Jeff Bezos, has been facing steep financial losses that have left
the once-loyal keeper of Donald Trumps secrets with more than $1 billion in
debt and a negative net worth.
The closely held American Media Inc. -- led by the presidents longtime friend,
David Pecker -- recorded a $31.5 million loss in the six months that ended Sept.
30, according to documents reviewed by Bloomberg. That marked an improvement
over the previous year, but nonetheless brought the companys total losses over
the last 5 1/2 fiscal years to $256 million. AMI owed about $203 million more
than its assets were worth.
Adding to the troubles for Pecker and his New York-based publishing company is
the wrath of Bezos. The billionaire wrote in a blog post last week that he was
blackmailed by the tabloid, which allegedly threatened to publish sexually
suggestive photos from an extramarital affair. The exchange followed a 12-page
spread in the Enquirer last month full of racy text messages that he reportedly
sent to his paramour.
----> Bezos, the worlds richest person, has the resources to fight. On Monday
alone, his wealth increased by a bigger dollar figure than all of AMIs revenue
for the first half of this fiscal year.
AMIs loss through September includes $70 million of noncash charges, which
shows the business was profitable on an operating basis, Chief Financial Officer
Chris Polimeni said in an emailed statement. In its most recent financial
guidance, published in September, the company said it expected revenue and
earnings to grow following a series of acquisitions.
The National Enquirers battle with Bezos is just the latest saga in a turbulent
few years for AMI, which has been on a borrowing binge that swelled its debt
load to more than $1.3 billion. Much of that is owed by its parent company,
Worldwide Media Services Group Inc., Polimeni said in a statement.
Pecker struck an immunity deal with federal prosecutors as part of an
investigation into Trumps former personal lawyer, Michael Cohen. The company
entered into a related Sept. 20 non-prosecution agreement covering crimes
including perjury and obstruction of justice, a deal that officials are
currently reviewing for potential violations.