Plans for Playboy.com IPO Scrapped
CHICAGO (AP) _ Playboy Enterprises Inc. has withdrawn its plans for an initial public offering of its online business because of unfavorable market conditions, the company said Tuesday.
Playboy said it continues to explore various financing alternatives and plans to proceed with a public offering of Playboy.com when market conditions improve.
``We do not believe that under current market conditions we would receive a valuation that reflects the extraordinary potential of this business,″ said Christie Hefner, Playboy’s chairwoman and chief executive officer.
Playboy.com posted a loss of $18 million through September, more than triple its loss for the same period of 1999, but revenues rose 132 percent to $18.8 million.
Hefner said it remains on target to achieve profitability in 2002 because of expected increases in revenue from its international sites, online gaming and Spice subscriptions next year.
She expressed confidence that Playboy.com ``will become one of our largest and most profitable businesses.″
In its earnings report released separately Tuesday, parent company Playboy Enterprises said that in the third quarter it lost $6.5 million, or 27 cents a share, compared with a loss of $1.1 million, or 5 cents a share, for the same period a year earlier.
The bulk of the loss, $4.2 million, resulted from expenses related to the sale of its Critics’ Choice Video catalog and to the planned IPO.
The company is the publisher of Playboy, the world’s No. 1 men’s magazine with a monthly circulation of more than 3 million. Playboy said circulation revenues fell slightly in the third quarter.
On Tuesday, Playboy stock fell 44 cents to close at $11.94 on the New York Stock Exchange.