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Playboy struggles to stay afloat

Published: Friday, February 20, 2009, 8:13 [IST]

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New York (ANI): In wake of the ongoing recession, Playboy bosses are coming up with new strategies to keep the magazine"s position stable in the market. Interim chairman Jerome Kern said that Playboy Enterprises is open to listening to sale offers. Kern was named non-executive chairman after Christie Hefner resigned in December, ending two decades running the magazine empire her father, Hugh, started in 1953.

Hugh Hefner still keeps an eye on every aspect of Playboy magazine as the top editor, from the lengthy articles to the jokes page, cartoons and the air-brushing of the nude layouts. However, the company has retained a search firm to find a new CEO. Last month, Playboy said it would cut jobs, consolidate online and print operations and take a writedown as the company struggles with a declining audience in a poor economy.

It slashed 14 percent of its workforce last year. "The results of our [costcutting] efforts to date should be meaningful, but in the face of current economic conditions, it is clear that our streamlining initiatives need to continue," the New York Daily News quoted Kern, as saying. Playboy said it expects to face additional setbacks this year, including a noncash impairment charge of about 5 million dollars in the first quarter.

In the first half of ''09, Playboy expects to incur a charge of about 9 million dollars relating to the closing of its Manhattan office. The Chicago-based company posted a quarterly loss of 145.7 million dollars, hurt by 157.2 million dollars in restructuring and other one-time costs.

Revenues declined to 69.8 million dollars from 85.9 million dollars a year ago. It had a net loss in each quarter of last year. In its licensing unit, which is responsible for placing the company''s iconic bunny ears logo on everything from T-shirts to diamond pendants, income declined 38 percent to 4.3 million dollars.

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