Playboy’s profit beats estimates
Playboy Enterprises Inc., publisher of the most widely read men’s magazine, posted an unexpected profit Tuesday, buoyed by online sales from porn star Jenna Jameson’s Club Jenna.
Net income dropped 66% to $1.1 million, or 3 cents a share, from $3.2 million, or 10 cents, a year earlier, Chicago-based Playboy said. Playboy beat the average estimate of a loss of 3.4 cents a share from analysts polled by Thomson Financial. Sales rose to $82.3 million.
Online sales rose 40%, helped by the June purchase of Club Jenna and sales of Playboy DVDs, the company said. Licensing revenue rose 41% to $4.6 million. The results show Chief Executive Christie Hefner, daughter of founder Hugh Hefner, may be succeeding in her efforts to revive sales after three years of revenue growth below 10%.
“Playboy is starting to emerge into a turnaround story,” said Michael Kelman, an analyst with Susquehanna Financial Group. “DVD sales and Club Jenna looked better than we had modeled, and the cost cutting at the magazine is starting to show through.”
Shares of Playboy rose 89 cents, or 8.5%, to $11.35. The shares had dropped 25% this year before Tuesday.