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Playboy Elects Scott Flanders Chief Executive

The Associated Press

CHICAGO (AP) — Playboy Enterprises Inc., the struggling adult-entertainment empire that may be sold, picked its new chief executive from the newspaper industry Monday, hiring away the head of the company that publishes the Orange County Register.

Scott N. Flanders will be the first permanent CEO at Playboy to come from outside the Hefner family. His naming ends a five-month search to fill the top job at the Chicago publisher and entertainment business after Christie Hefner, daughter of founder Hugh Hefner, resigned in December.

Jerome Kern has been serving as interim CEO.

In a statement Monday, the company noted Flanders, 52, helped expand online revenue and streamline operations at Freedom Communications, owner of the Orange County Register in Southern California, as well as other newspapers and TV stations.

Playboy has signaled it is open to selling the company as it struggles with losses at its namesake magazine and the effects of the recession at its more profitable entertainment and licensing units.

The company has been slashing costs, recently shuttering its offices in New York and laying off most of the 100 employees who worked there.

Last month, it reported a quarterly loss of $13.7 million, compared with a $4.2 million loss in the year-earlier period.

Kern has said the company may cut Playboy magazine's frequency, reduce circulation or raise prices to stanch the bleeding.

"It is clear that this company cannot continue to sustain significant losses in a business that now comprises less than one-quarter of the company's revenue base," he said in May, discussing the future of the magazine in a call with analysts.

In a statement Monday, Flanders called it "a particularly exciting time to assume the role of CEO" even as he acknowledged the historic challenges facing the company.

"The evolution of the media industry and the global recession's effect on consumer spending intensify the need for a creative and effective business model," he said.