Chuck, I can respect your appreciation for New York Times' (NYSE:NYT) dividends. But what once looked like a supremely secure payout seems increasingly less stable these days. Witness the recent trends:

Metrics (in millions)

FY 2003

FY 2004

FY 2005

TTM

Operational Cash Flow

$466

$444

$294

$276

Capital Expenditures

$173

$189

$221

$286

Free Cash Flow

$293

$255

$73

($10)

Dividends Paid

$85.5

$90.1

$94.5

$98.8


The payout ratio has gone from 18% of operating cash flow in 2003 to a staggering 35% today, with no sign of the trend reversing. New York Times used to be awash in free cash flow, but that's a red line today.

The company, along with Gannett (NYSE:GCI), Dow Jones (NYSE:DJ), and the rest, is trying hard to stay relevant. Times recently released a piece of software to let users more easily access the paper's online materials on the go, for example -- but it seems nobody noticed. The new information portals are companies like Yahoo! (NASDAQ:YHOO) and Google (NASDAQ:GOOG), not dead-tree dinosaurs like New York Times or Tribune (NYSE:TRB), tacking on a few Internet bells and whistles to keep pace. No wonder the old-school media giants are selling off their non-core assets -- they pretty much have to if they want to keep the dividends flowing. Thanks, but I'll pass.

Further Foolishness:

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Fool contributor Anders Bylund holds no position in any of the companies discussed here. You can check out Anders' holdings if you like, and Foolish disclosure is always worth fighting for.