Playboy Takes $100M Charge, Closes N.Y. Editorial Offices

LOS ANGELES — Playboy Enterprises plans to write down more than $100 million and consolidate its online and print operations as it tries to shore up its business.

The company also will move nearly all of its New York editorial operations to Chicago and make cuts to an unspecified number of jobs.

The move is considered a bold but necessary one because the company is in the midst of reinventing itself.

Playboy, which is in the midst of a search to replace CEO Christie Hefner, just completed the long-awaited relaunch of its flagship site, Playboy.com, which will include more social-networking features. Aiming for local ad dollars, it will also have a city guide.

With anticipation for change, Playboy reported Thursday it would take a $100 million charge related to goodwill and other intangible assets in its fourth quarter 2008 results, which it says will result in a loss. It also expects to report a restructuring charge of $4 million.

Playboy said that it is close to integrating its publishing and online units that will be based in the company’s Chicago office. Playboy’s offices on Fifth Avenue in New York will be sublet.

In a statement, Playboy said “the two operations have worked cooperatively and shared an advertising sales team, but going forward the company will focus on creating brand-consistent content that extends across print and digital platforms.”

Playboy spokeswoman Martha Lindeman did not return calls to XBIZ by post time.

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