Summary:

Although Playboy Enterprises (NYSE: PLA) had warned that its Q2 earnings would look worse than previously thought due to higher restructurin…

Playboy Shadow

Although Playboy Enterprises (NYSE: PLA) had warned that its Q2 earnings would look worse than previously thought due to higher restructuring charges, the company still managed to miss analysts expectations. Playboy’s net loss widened to $8.7 million ($0.26 per share) from $3.2 million ($0.10 per share) last year. Analysts were anticipating a net loss of $0.23 per share (via Thomson Reuters). Revenues fell 15.3 percent to $62.2 million.

In his first presentation as Playboy’s CEO, Scott Flanders said that more cost-cutting was needed and he was prepared to do more outsourcing and would look to unload unprofitable businesses. After five weeks in the job, Flanders conceded during the earnings call that he’s still in the “honeymoon phase.” And although he didn’t offer a plan for how to fix what’s ailing Playboy, he did stress that building up the TV and the magazine are critical to preserving the company’s brand.

2Q 2009 2Q 2008 Analysts Estimates For 2009
EPS -$0.26 -$0.10 -$0.23
Net Income -$8.7M -$3.2M NA
Revenue $62.2M $73.4M NA

Earnings release | Webcast (11:00 AM EDT) | Transcript (via Seeking Alpha)

Digital’s down: So far, the long-awaited digital revamp that was unveiled last January hasn’t produced any benefits yet. The company blamed lower paysite, e-commerce and ad dollars for the digital segment’s 23.3 percent decline to $8.9 million. Despite all its troubles, the combined Print/Digital unit’s income rose to $2.3 million from $0.1 million from last year. Still, revenues for the combined group were $28.3 million in the quarter, down 12 percent year-over-year.

– The Entertainment Group at least could point to a small turnaround. The group posted $2 million income after segment loss of $200,000 in the same period last year. The improvement was due mostly to cost-savings, however, as Q2 revenues slipped to $23.8 million from $29.6 million.

– Licensing Group revenues and segment income were $10.1 million and $4.8 million, down 14 percent and 22 percent, respectively.

Bullish on TV: Last year around this time, the old guard had been talking up the importance of its digital revamping, which was finally unveiled last January. In his first call with analysts and investors, Flanders said that making its magazine and TV offerings profitable was key to attracting consumers and advertising. As for online, Flanders said that as users get more of their entertainment from digital, Playboy’s fortunes in that space will rise in tandem. But TV is where is heart seems to be. Flanders: “I like TV because in a fragmented media landscape, it

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