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Charges Widen Playboy Fourth-Quarter Loss

The Associated Press

CHICAGO -- Playboy Enterprises (PLA Quote) on Wednesday reported its loss widened in the fourth quarter as revenue fell and the publishing and entertainment company logged significant impairment charges.

Playboy shares rose 8 cents, or 5.3%, to $1.58 in midday trading. The stock has ranged from $1.03 to $9.13 over the past year.

For the quarter ended Dec. 31, Playboy recorded a loss of $145.7 million, or $4.37 per share, compared with $1.1 million, or 3 cents per share, in the year-ago quarter.

The latest quarter included $146.4 million in non-cash impairment charges on its goodwill and other intangible company assets. The charges pertained mostly to television acquisitions it made in the late 1990s.

Excluding that and other special items, Playboy earned 35 cents per share in the latest quarter.

Revenue sank 19% to $69.8 million from $85.9 million, due mainly to a 21% drop in entertainment revenue.

Publishing revenue, which includes revenue from Playboy magazine, declined 11% to $22 million.

The company indicated in a conference call with analysts that it is willing to hear offers regarding a possible sale of the company. The company also said it is open to change in its magazine strategy.

For the full year, Playboy reported a loss of $156.1 million, or $4.69 per share, compared with a profit of $4.9 million, or 15 cents per share, in 2007. Adjusted for special items, 2008 profit was 25 cents per share. Revenue fell 14% to $292.1 million.

Looking forward, Playboy predicted it will see a 27% drop in first-quarter ad revenue in its publishing unit.

Also in the conference call, company said it is looking for a new Chief Executive. Jerome Kern is currently serving as interim CEO and Chairman. He took over for Christie Hefner, daughter of founder Hugh Hefner, when she stepped down in December.