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PLAYBOY ENTERPRISES REPORTS BETTER THAN ANTICIPATED FISCAL 1993 FIRST QUARTER RESULTS

 PLAYBOY ENTERPRISES REPORTS BETTER THAN ANTICIPATED
 FISCAL 1993 FIRST QUARTER RESULTS
 CHICAGO, Oct. 26 /PRNewswire/ -- Playboy Enterprises, Inc. (NYSE PSE: PLA PLAA) today reported an operating loss of $.9 million for the fiscal 1993 first quarter, significantly better than the $1.4 million loss that it had previously projected. The loss, which reflects both lower results from Playboy magazine and related businesses as well as $.3 million of one-time expense related to the Entertainment Group's move to new headquarters, compares to operating profit of $.6 million in the fiscal 1992 first quarter. For the quarter, which ended Sept. 30, 1992, the company reported a net loss of $1.0 million, or $.05 per share, versus net income of $.9 million, or $.05 per share, in the same period last year. Revenues for the quarter rose 6 percent to $48.1 million from $45.6 million in the prior year.
 Playboy Enterprises Chairman and Chief Executive Officer Christie Hefner said: "As anticipated, Playboy magazine's results were affected by a 22 percent decline in advertising pages, reflecting the general softness in certain segments of the ad market. The decline in advertising for Playboy appears to have lasted four quarters. Advertising sales for the next three issues of the magazine now have closed, and we will be reporting a strong second quarter with ad pages up approximately 12 percent compared to last year's second quarter. As stated earlier this year, barring unforeseen events, we expect to report second quarter operating profit in excess of the $.8 million reported for the same period last year and, for fiscal 1993, to report our fourth consecutive year of solid operating profit growth.
 "I'm very pleased to note that our fast-growing catalog and entertainment businesses reported solid growth in the first quarter. Catalogs are benefiting from the acquisitions of the assets of two competitors of our Critics' Choice Video catalog and the resulting increase in customer lists and orders. Continued growth in our pay television service and demand for our programming in both the home video and international markets contributed to the increase in operating income of the Entertainment Group."
 Publishing
 First quarter operating income for the Publishing Group declined 38 percent to $2.6 million from last year's $4.2 million on a 1 percent increase in revenues to $37.8 million. Improved results from the catalog business were unable to offset declines in results from Playboy magazine and Playboy-related businesses, which include newsstand specials, calendars and foreign editions.
 For the quarter, Playboy magazine's advertising pages totaled 140 versus 180 in the strong prior year quarter, contributing to a 14 percent decline in operating income to $1.7 million and a 5 percent decline in revenues to $24.5 million. Lower paper costs partially offset the ad page shortfall. Playboy-related businesses also reported declines in operating profit and revenues, down 50 percent to $1.4 million and 26 percent to $5.1 million, respectively. The primary cause for the downturn in operating income was lower sales of newsstand specials, including adjustments to prior year issues.
 Improved results from the company's Critics' Choice Video catalog led to a 146 percent increase in catalog operating income to $1.1 million on a 65 percent increase in revenues to $8.2 million.
 Entertainment
 Entertainment Group first quarter operating income rose to $.5 million from $.1 million in the prior year as domestic pay television, home video and international television all reported improved results. Excluding subleasing costs related to the Entertainment Group's move to new headquarters this past summer, operating income for the quarter would have been $.8 million. Revenues for the Entertainment Group were up 37 percent to $8.7 million.
 For the fiscal first quarter, domestic pay television revenues rose to $5.0 million reflecting an increase in the number of homes that have access to the company's pay-per-view television service. At the end of the quarter, the company's pay television service was available on a pay-per-view basis to 7.6 million U.S. homes, up from 5.1 million a t the end of the fiscal 1992 first quarter. Domestic home video revenues for the quarter increased to $2.1 million primarily due to a change in distributors in October 1991, while the sale of new television programming overseas primarily was responsible for an increase to $1.6 million in international revenues.
 Programming expense for the quarter was essentially flat. A change in accounting estimate effective in the fiscal 1992 second quarter led to a $.6 million reduction in the quarter's programming expense, which was offset by the increased amortization resulting from previous years' investments in programming.
 Product and Event Marketing
 Despite higher revenues from international product licensing and Special Editions, Ltd., product and event marketing reported a 9 percent decline in revenues to $1.6 million for the quarter as compared to last year due to the continued repositioning of Playboy's line of domestic licensed products. As a result, first quarter product and event marketing operating income was down from $.4 million last year to $.2 million.
 Other Items
 Corporate administration and promotion expense rose 5 percent to $4.2 million for the quarter.
 Playboy Enterprises Inc. is an international publishing and entertainment company that publishes Playboy magazine and related media, including newsstand specials and calendars; operates a direct marketing business, including the Playboy and Critics' Choice Video catalogs; creates and distributes programming for domestic pay television, worldwide home video and international television; and markets the Playboy trademarks on apparel, accessories and products for consumers around the world.
 PLAYBOY ENTERPRISES, INC. AND SUBSIDIARIES
 Condensed Statements of Consolidated Operations
 (Unaudited, in thousands, except per share amounts)
 Quarters ended Sept. 30 1992 1991
 Net revenues
 Publishing:
 Playboy Magazine $ 24,458 $ 25,659
 Playboy-Related Businesses 5,055 6,790
 Catalogs 8,175 4,961
 Other 100 --
 Total Publishing 37,788 37,410
 Entertainment:
 Pay Television 5,008 4,360
 Domestic Home Video 2,069 777
 International 1,636 1,201
 Other 7 39
 Total Entertainment 8,720 6,377
 Product and Event Marketing 1,630 1,783
 Total net revenues $ 48,138 $ 45,570
 Operating income (loss)
 Publishing:
 Playboy Magazine $ 1,696 $ 1,972
 Playboy-Related Businesses 1,411 2,805
 Catalogs 1,118 454
 Other (1,629) (1,065)
 Total Publishing 2,596 4,166
 Entertainment 509 119
 Product and Event Marketing 195 370
 Corporate Administration & Promotion (4,240) (4,037)
 Total operating income (loss) (940) 618
 Investment income, net 320 437
 Other, net (239) 43
 Income (loss) before income taxes and
 extraordinary item (859) 1,098
 Income tax (expense) benefit 196 (595)
 Income (loss) before extraordinary item (663) 503
 Extraordinary item -- tax benefit
 (charge) resulting from utilization
 of loss carryforwards (350) 374
 Net income (loss) $ (1,013) $ 877
 Income (loss) per common share:
 Income (loss) before extraordinary item $ (.03) $ .03
 Extraordinary item (.02) .02
 Net income (loss) $ (.05) $ .05
 Weighted average number of
 common shares outstanding 18,532 18,510
 -0- 10/26/92
 /CONTACT: Martha O. Lindeman of Playboy Enterprises, 312-751-8000, ext. 2650/
 (PLA) CO: Playboy Enterprises, Inc. ST: Illinois IN: ENT SU: ERN


TS -- NY019 -- 4581 10/26/92 09:04 EST
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Date:Oct 26, 1992
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