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PLAYBOY ENTERPRISES REPORTS IMPROVEDRESULTS FOR FISCAL 1993 SECOND QUARTER

 CHICAGO, Feb. 1 /PRNewswire/ -- Playboy Enterprises, Inc. (NYSE: PLA) today announced operating income rose 40 percent to $1.1 million for the fiscal 1993 second quarter, which ended Dec. 31, 1992, compared to the prior year, driven by improved Publishing Group performance. Excluding one-time expenses of $.3 million relating to the moves of both the Entertainment Group and catalog business to new headquarters, operating income would have risen 66 percent to $1.4 million. Second quarter revenues rose 15 percent to $57.2 million.
 Net income for the quarter was up 15 percent to $1.4 million, or $.08 per share, compared to $1.3 million, or $.07 per share, for the same period last year. The fiscal 1993 quarter's results included a one-time $1.0 million tax benefit resulting from a favorable adjustment to a previously established reserve for a tax case that was settled during the quarter. Excluding the tax- and move-related one-time items, net income for the fiscal 1993 quarter would have been $.7 million, or $.04 per share.
 Playboy Enterprises Chairman and Chief Executive Officer Christie Hefner said: "As reported in October, after four quarters in which advertising pages in Playboy magazine declined year to year, we saw a turnaround during this past quarter. We're pleased to announce that this favorable trend has continued through our third quarter, which closed with a 5 percent increase in ad pages. The second quarter also benefited from continued significant profit growth in our catalog business."
 PUBLISHING
 Improved results for Playboy magazine and the catalog business contributed to a 25 percent increase to $4.2 million in the Publishing Group's second quarter operating income in spite of a decline in Playboy-related businesses' operating income in the period. Revenues for the group rose 9 percent for the quarter to $44.0 million.
 Playboy magazine's second quarter operating income increased 38 percent to $2.8 million on a 4 percent increase in revenues to $28.3 million. Advertising pages totaled 205, up 14 percent from 179 pages in the previous year's quarter. Higher subscription revenues largely offset a decline in revenues from newsstand sales. Lower paper prices also contributed to the improved results.
 Second quarter operating income for the company's catalog business was up 48 percent to $1.0 million due to continued strength of the Critics' Choice Video catalog, which benefited from the acquisitions of two competing catalogs in fiscal 1992. Revenues for the catalog business rose 26 percent to $10.6 million. During the quarter, the company's catalog business moved to new leased headquarters in suburban Chicago that provide the office and warehouse space needed to accommodate the business' demonstrated growth. The company plans to sell the facility in which the catalog business previously was headquartered.
 ENTERTAINMENT
 The Entertainment Group's second quarter revenues rose 47 percent to $11.1 million from the previous year's quarter, reflecting growth in all three distribution channels: pay television, home video and international businesses. The company has been increasing its programming investments to drive this revenue growth. For the second quarter, programming amortization expense increased $1.0 million over the previous year's quarter to $3.2 million. This increase plus higher direct costs and marketing expenses offset the revenue growth. Operating income for the quarter, which included $.2 million in one time move-related expenses, was $.6 million, compared to $.8 million in the prior year.
 The investment in marketing and sales led to an increase in pay television revenues of 20 percent to $5.3 million principally due to higher pay-per-view sales volume. On Dec. 31, 1992, Playboy Television was available on a pay-per-view basis to almost 8 million homes, up from 5.3 million a year earlier. Additionally, sales of the company's new television programming led
to the 143 percent increase in international revenues. A change in distribution arrangements was primarily responsible for the 48 percent increase in domestic home video revenues and a related increase in direct costs.
 PRODUCT AND EVENT MARKETING
 Second quarter revenues for Product and Event Marketing rose 10 percent to $2.1 million. The company's subsidiary Special Editions, Ltd. expanded its line of wearable art products and reported higher sales, which more than offset lower royalties from the old product licensing program that is being phased out. Operating income for the group declined to $.6 million from $.9 million.
 OTHER ITEMS
 Corporate administration and promotion expenses were essentially flat for the quarter at $4.2 million.
 Second quarter results were affected by $.1 million in net interest expense compared to $.8 million in net interest income for the prior year period. An extraordinary item representing the tax benefit from the utilization of operating loss carryforwards totaled $.5 million in the fiscal 1992 quarter.
 SIX-MONTH RESULTS
 The second quarter operating profit more than offset the company's first quarter operating loss, resulting in operating income for the year-to-date period of $.2 million. This compares to $1.4 million in the year earlier period. Revenues for the first half of the fiscal year were up 10 percent to $105.4 million while net income declined to $.4 million, or $.02 per share, from $2.1 million, or $.12 per share.
 Excluding the one-time move-related expenses from both years, operating income for the first six months would have totaled $.8 million in fiscal 1993 versus $1.5 million in fiscal 1992. Net income would have totaled $.1 million and $2.2 million for the fiscal 1993 and 1992 periods, respectively, excluding the move-related expenses and the one- time tax benefit of $1.0 million.
 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
 Dec. 31 1992 1991
 NET REVENUES
 Publishing:
 Playboy Magazine $ 28,333 $ 27,126
 Playboy-related businesses 5,052 4,573
 Catalogs 10,569 8,377
 Other 62 289
 Total publishing 44,016 40,365
 Entertainment:
 Pay Television 5,286 4,401
 Domestic Home Video 3,027 2,039
 International 2,387 981
 Other 370 126
 Total entertainment 11,070 7,547
 Product and event marketing 2,137 1,938
 Total net revenues $ 57,223 $ 49,850
 OPERATING INCOME
 Publishing:
 Playboy Magazine $ 2,789 $ 2,014
 Playboy-related businesses 1,961 2,164
 Catalogs 981 663
 Other (1,526) (1,484)
 Total publishing 4,205 3,357
 Entertainment 574 832
 Product and event marketing 558 859
 Corporate administration & promotion (4,223) (4,250)
 Total operating income 1,114 798
 Investment income (expense), net (111) 758
 Other, net (246) (12)
 Income before income taxes and
 extraordinary item 757 1,544
 Income tax benefit (expense) 686 (789)
 Income before extraordinary item 1,443 755
 Extraordinary item - tax benefit
 resulting from utilization
 of loss carryforwards - 497
 Net income $ 1,443 $ 1,252
 Income per common share:
 Income before extraordinary item $ .08 $ .04
 Extraordinary item - .03
 Net income $ .08 $ .07
 Weighted average number of
 common shares outstanding 18,532 18,518
 PLAYBOY ENTERPRISES, INC. AND SUBSIDIARIES
 Condensed Statements of Consolidated Operations
 (Unaudited, in thousands, except per share amounts)
 Six months ended
 Dec. 31 1992 1991
 NET REVENUES
 Publishing:
 Playboy Magazine $ 52,791 $ 52,785
 Playboy-related businesses 10,107 11,363
 Catalogs 18,744 13,338
 Other 162 289
 Total publishing 81,804 77,775
 Entertainment:
 Pay Television 10,294 8,761
 Domestic Home Video 5,096 2,816
 International 4,023 2,182
 Other 377 165
 Total entertainment 19,790 13,924
 Product and event marketing 3,767 3,721
 Total net revenues $ 105,361 $ 95,420
 OPERATING INCOME
 Publishing:
 Playboy Magazine $ 4,485 $ 3,986
 Playboy-related businesses 3,372 4,969
 Catalogs 2,099 1,117
 Other (3,155) (2,549)
 Total publishing 6,801 7,523
 Entertainment 1,083 951
 Product and event marketing 753 1,229
 Corporate administration & promotion (8,463) (8,287)
 Total operating income 174 1,416
 Investment income, net 209 1,195
 Other, net (485) 31
 Income (loss) before income taxes and
 extraordinary item (102) 2,642
 Income tax benefit (expense) 532 (1,384)
 Income before extraordinary item 430 1,258
 Extraordinary item - tax benefit
 resulting from utilization
 of loss carryforwards - 871
 Net income $ 430 $ 2,129
 Income per common share:
 Income before extraordinary item $ .02 $ .07
 Extraordinary item - .05
 Net income $ .02 $ .12
 Weighted average number of
 common shares outstanding 18,532 18,514
 -0- 2/1/93
 /CONTACT: Martha O. Linderman of Playboy, 312-751-8000, ext. 2650, or 312-440-5493/
 (PLA)


CO: Playboy Enterprises, Inc. ST: Illinois IN: ENT SU: ERN

WB -- NY035 -- 1277 02/01/93 10:38 EST
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