What Not Online Auctions

HomeDealers and CompaniesF+W, Publisher of Numismatic News, Declares Bankruptcy

F+W, Publisher of Numismatic News, Declares Bankruptcy

Numismatic News

By CoinWeek News Staff ….
F+W Media (the parent company of Numismatic News), along with eight other companies affiliated with F+W, filed for Chapter 11 bankruptcy relief on Sunday, March 10 in the Bankruptcy Court for the District of Delaware. Citing print publication industry decline, bad capital investments and mismanagement, the company found itself $105.2 million in debt and with only $2.5 million cash in hand.

Based out of New York City, F+W Media operates several different businesses, including online education, video subscription websites, e-commerce concerns, consumer and trade events, and print and digital media. In that last category, F+W publishes content for 10 different “communities”: Craft; Artist’s Network; Collectibles; Writing; the Outdoors; Sky & Telescope; Woodworking; Family Tree; Construction; and Horticulture. Together, these “communities” produced about $67.7 million in revenue for the company in 2018. Craft was the overwhelming revenue leader, earning about $32.5 million of the total, with Artist’s Network in a distant second place, garnering $8.7 million last year.

A book division of F+W Media produced $22 million in revenue for 2018. The numismatic publications of Krause Publishing presumably contributed to that total.

According to the filings submitted to the court by company CEO Gregory Osberg, F+W Media will attempt to continue as an active concern by selling off several businesses and restructuring the company. It is also requesting permission to receive $8 million in super-priority Debtor-in-Possession financing to help achieve this goal. For those not familiar with this tactic, it is an attempt to borrow money from lenders that are already among the company’s creditors as listed in the bankruptcy filings. The phrase “super-priority” refers to the fact that these lenders would be paid off first, thereby encouraging them to lend the money; “debtor-in-possession” refers to a special kind of interim financing available to companies in bankruptcy that seek to maintain operations in the future.

F+W Media estimates that between 1,000 to 5,000 creditors will still have a claim to some part of the $105.2 million in liabilities the company owns. F+W estimates its assets at being in the $50-100 million range.

Osberg’s filings blame many factors, with three interconnected primary reasons for the company’s financial woes.

First, the subscription market for print materials has shrunk and continues to shrink. The F+W subscriber base for all publications under its imprint decreased to 21.5 million households in 2018 from 33.4 million in 2015 – an almost 12 million household loss in just three years. Ad revenue during the same period dropped almost 34%, from $20.7 million in 2015 to $13.7 million last year. These facts were a major reason for the company’s decision to look at digital and e-commerce formats.

Second, while an earlier restructuring in 2017 had managed to reduce the company’s debt, bad management (according to Osberg) squandered the $15 million F+W Media had received as interim financing in only six months. Costs included increased tech spending, increased merchandise being stored in warehouses in anticipation of internet sales, and an increased workforce. As an example, technology contracts involved in the company’s diversification into digital formats incurred a 385% capital expenditure increase in 2017.

Third, inexperience with the digital platform and e-commerce spending that outweighed sales were singled out in Sunday’s filing. The company’s new emphasis on its internet business also helped speed the decline of F+W’s subscription print model.

Osberg, who was appointed interim CEO in January of 2018 and full CEO in late June of that year, did not oversee the 2017 restructuring. Instead, Osberg has managed the company’s recent asset divestment, which saw the sales of F+W Media’s Keepsake Quilting e-commerce unit for $2.45 million; Blade magazine for $2.45 million; a related Blade trade show for $4.34 million; and the online Martha Pullen unit for $1.54 million.

The decision to file for Chapter 11 bankruptcy and to restructure the company yet again was made after Osberg and other members of senior management saw these numbers and realized similar divestment would not rescue the company.

The bankruptcy case–known as Lead Case No. 19-10479–will be overseen by Judge Kevin Gross.

Both Numismatic News and Krause Publications were founded in 1952 by Chester “Chet” Krause, who died in 2016. Additonally, longtime Numismatic News editor Dave Harper announced his retirement in early February 2019. The future of hobby stalwart Numismatic News is uncertain for more than one reason, but as of this article’s publication, no plans have been announced by F+W’s current management concerning the company’s numismatic properties.

* * *





Coinweek is the top independent online media source for rare coin and currency news, with analysis and information contributed by leading experts across the numismatic spectrum.

Related Articles


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Great Collection Coin Auctions

L and C COIN Shop Now

NGCX Holders and Grading