Private Media Group Announces Third Quarter Profits

Jeff Berg
BARCELONA, Spain — Adult entertainment company Private Media Group announced its third quarter financial results on Monday, revealing a net income increase of approximately $1.6 million.

The increase, which boosted the company’s net loss during the three months ending Sept. 30, 2003 to about $906,000 in profit during the same quarter this year, is attributed to a 37 percent increase in Internet sales and similar increases in DVD and broadcasting sales, according to the company.

“As third quarter figures demonstrate, I am pleased to see that our efforts made in Internet and broadcasting sales are paying off,” said Berth Milton, president and CEO of Private.

“Combined efforts with broadcasting, both in terms of carriage agreements as well as in terms of format and content, and the ongoing development of value-added retail distribution formats such as the Private Center at Zurich Airport, clearly shows the value attached to the Private brand and how it can be applied across all of our business segments,” Milton said.

In early October, the company signed a three-year deal with Pure Play which would increase the amount of movie titles that Private distributes a month in Europe by about ten. In turn, Pure Play has taken over all U.S. distribution for Private.

Private also launched a series of reality television show programs called “Private Stars,” this year. Due to the positive response for its pilot run, the group launched three follow-up shows in late September.

“Going forward, into 2005 and beyond, we expect overall sales to increase, in particular in Internet and broadcasting, but also in DVDs as a result of our new European distribution agreement with Pure Play Media,” Milton said.

According to Private, the company made approximately $7.38 million in DVD sales during the third quarter of 2004, an increase of 29 percent over 2003 figures.

However, Private’s video sales experienced a decline of about 39 percent, dropping video revenue to about $1.4 million.

Broadcasting sales increased by more than half this year and now represents about $1.6 million of the company’s profit, which Private attributes to the launch of the Private Fantasy Channel, a new North American Pay-Per-View satellite and cable television channel unveiled in February 2004.

The company is publicly traded on the Nasdaq under “PRVT.”