Playboy Q4 Profit Drops

CHICAGO, February 13: Fourth quarter net income at Playboy
Enterprises fell from $4.6 million to $3.7 million, while operating income
dropped from $7.3 million to $3.1 million, on revenues of $86.2 million, down
from last year’s $91 million.

The licensing and publishing groups showed improved
operating results in the quarter, but the gains were more than offset by lower
entertainment group income due to weakness in the U.S. TV business and a
litigation settlement of $1.8 million. The entertainment group’s segment income
was down to $4.7 million from $12.3 million and revenues were down 8 percent to
$52.1 million. U.S. TV revenues fell 18 percent, despite gains in VOD and
Playboy TV subscription revenues, with lower satellite and cable pay per view
revenues. International revenues slipped to $14.4 million from $14.6 million as
a result of lower third-party sales.

For the year, the company reported a profit of $2.3 million,
versus last year’s $700,000 loss. Operating income in 2006 was $9.1 million,
versus $30.9 million in the prior year, on a 2 percent decline in revenues to
$331.1 million.