“McClatchy is marketing $875 million of bonds this week. But bond investors should be wary. McClatchy’s performance will be tough to maintain,” writes Lauren Silva Laughlin.

McClatchy has cut costs, mainly through layoffs, to recover from near bankruptcy, and digital advertising revenue grew by 15 percent in 2009 compared to 2008. But online revenue is still only 16 percent of the total, which was down by 20 percent in the 4th quarter of 2009.

“The worry is that McClatchy can’t cut costs fast enough to bridge the time it will take to transform print revenue to digital,” Laughlin says. “Without ending the print declines, lost revenue could easily consume the benefits of cost savings.”

McClatchy is selling senior secured notes due in 2017 in a deal that is expected to price on February 4. The publisher intends to use the net proceeds of the offering to repay approximately $614 million under its credit agreement and to fund its cash tender offer for approximately $166 million aggregate principal of notes due June 1, 2011 and approximately $24 million of senior notes due 2014.