reported a loss during the third quarter, primarily driven by impairment and restructuring charges totaling $25.8 million.
For the quarter ended September 30, the company saw a loss of $27.4 million, or 81 cents per diluted share, compared with a loss of $1.1 million, or 3 cents per diluted share, in the same period a year ago. Analysts had expected a loss of 71 cents according to
Total revenue fell 7% to $52.1 million from $56 million during the quarter as a decrease in entertainment revenue and increased expenses more than offset gains in print, digital and licensing groups revenues.
Expenses related to impairment and restructuring skyrocketed to $25.8 million from $500,000 in the same period a year ago. Programming costs were $22.3 million while distribution agreement expenses came in at $3.1 million.
Corporate expenses rose 38.2% to $7.6 million from $5.5 million due to higher trademark defense costs and fees related to Hugh Hefner's proposal to take the company private.
Entertainment group revenue dropped 20.1% to $19.5 million from $24.4 million on lower U.S. television revenue. Domestic television revenue fell 21% to $9.8 million from $12.5 million, primarily due to
withholding payments of about $3 million for Playboy programming during the quarter.
International television revenue was down 15.9% to $9 million from $10.7 million due to increased competition and an unfavorable foreign exchange rate.
Print and digital revenue was down 5.2% to $21.7 million from $22.9 million, while the 6.4% increase in
magazine revenue to $10 million from $9.4 million was offset by the 11.5% drop in digital revenue to $8.5 million from $9.6 million.
The improvement at
magazine was largely due to a 21% increase in circulation revenue as the company published three issues in the third quarter versus two in last year's quarter.
The company expects
magazine advertising pages to increase approximately 7% in the fourth quarter.
Licensing revenue was up 25.3% to $10.9 million from $8.7 million driven by a 36% increase in consumer product sales. Consumer product revenue was up 36.1% to $9.8 million from $7.2 million due to increased royalties from licensees in Southeast Asia and Latin America.
"We are excited to report financially meaningful developments in this strategically important business," CEO Scott Flanders said. "Later this month we will open Playboy clubs in both Macao and Cancun, and we finalized last month a plan to bring a Playboy club back to London after more than two decades. We expect the London club to open in the second quarter of 2011."
For the nine months ended September 30, the company saw a loss of $33.8 million, or $1.01 per share, compared with a loss of $23.5 million, or 70 cents, in the same period a year ago.
Revenue fell 10.9% to $160.2 million from $179.8 million.
The company also announced that it signed IMG Licensing Worldwide as its exclusive agent in Europe, expanding its geographic responsibilities for licensing the Playboy brand.
"IMG's extensive network of agents in Europe can help increase Playboy's consumer reach as well as the visibility and power of the Playboy brand," Playboy senior vice president of global licensing Adrianna Chinnici said.
-- Written by Theresa McCabe in Boston.
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