The report, which also summarized the entire year of 2008, reported an increase on fourth-quarter income over 2007, reflecting higher profits from the Entertainment division and reduced Corporate Administration and Promotion expense. The company reported a fourth-quarter net loss of $145.7 million, which included impairment, restructuring and other charges.
In the accompanying press release, Kern said "Our financial performance is not reflective of its potential. Over the past several months, the company has accelerated the pace of expense reductions designed to bring our cost structure in line with current market realities and the positioning of our businesses going forward. The results of our efforts to date should be meaningful, but in the face of current economic conditions, it is clear that our streamlining initiatives need to continue."
Kern referred to Playboy's licensing business as "a long-term growth engine for the company" and mentioned "two entertainment venue deals, one of which could open even before Playboy Mansion Macao is completed next year."
Playboy Mansion Macao is a collaboration between Playboy and Macao Studio City, a 40,000-square-foot entertainment destination with nightlife and entertainment options including dining, specialty retail elements and a Hugh M. Hefner Villa as part of the Macao Studio City complex.
"With a disciplined operating approach and the worldwide appeal of the brand, we believe we can exit the downturn in a position of renewed strength and return this company to profitability," Kern said.
The question about the possible sale of the company came from Jonathan Boyar of Boyar Asset Management, who asked about former CEO Christie Hefner's severance package and followed up with "Now that Christie is no longer CEO and there’s not a Hefner in charge, is the company more open to an outright sale of the company or change in the strategic direction of the print magazine?"
To which Kern responded "Yes. We’re willing to listen."
The complete Playboy Enterprises 10-K report is available here.
