Playboy Enterprises open to sale, reorganization ideas
Posted on February 19th, 2009 by Hot Momma
The interim boss of Playboy Enterprises Inc. told Wall Street analysts Wednesday that they are all ears to ideas for the sale or reorganization as it continues to lose money and is ready for a white knight to sweep it off it’s feet.
The company, which posted a wider fourth-quarter loss then expected and net loss in each quarter of 2008, is owner of the world’s best known men’s magazine Playboy.
Net loss for Playboy, which in recent months has seen a management shake-up including the resignation in December of longtime Chief Executive Christie Hefner, was $145.7 million, or $4.37 per share. This compares with a loss of $1.1 million, or 3 cents a share, in the year-ago period.
Last month, Playboy said it would cut jobs, consolidate online and print operations and take a writedown as the company struggles with a declining audience in a poor economy. The company cut 14 percent of its workforce in 2008.
“The results of our (cost-cutting) efforts to date should be meaningful, but in the face of current economic conditions, it is clear that our streamlining initiatives need to continue,” interim Chairman and Chief Executive Officer Jerome Kern said in a statement.
Any deal would need the support of 82-year-old Playboy founder Hugh Hefner, who retains a controlling stake, and the company is more likely to try engineering a turnaround than to sell, it says.
On a conference call with analysts, Kern said the company is “actively engaged” in a CEO search. Hugh Hefner, the company’s 82-year-old founder and father of Christie Hefner, still oversees Playboy magazine as editor-in-chief, from the lengthy articles to the jokes page, cartoons and the airbrushing of the nude layouts.
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