(Filed Under wholesale Lingerie News). Playboy reported another loss in the fourth quarter, as well as a 28% decline in net revenue, and revealed it is “very close to selling” Yandy.com, the online retailer it acquired at the end of 2019.

In the fourth quarter of 2022, Playboy net revenue fell to $68.517 million, down from $95.699 million in the same quarter in 2021, but the loss this quarter shrank to $10.235 million compared to one of $56.064 million in the three months ended December 31, 2021.

For the full year 2022 the company reported a loss of $277.704 million on sales of $266.933 million compared to a loss of $77.676 million on sales of $246.586 million in 2021. The big loss in 2022 was “driven by non-cash asset impairment charges related to the write-down of goodwill, trademarks and other assets of $308.2 million recorded in the third quarter of 2022.”

The company has achieved some success with Honey Birdette, where full year sales rose from $78.4 million in 2021 to $83.6 million in 2022. During the conference call CFO Lance Barton mentioned plans to open “four to six” new Honey Birdette shops, “mostly in Q4,” and CEO Ben Kohn added “we see a total market opportunity of at least 100 stores domestically.”

At Yandy, annual sales fell to $33.1 million in 2022 from $57.9 million in 2021. Meanwhile, at Lovers, the chain of adult stores it acquired in early 2021, sales sank to $48.3 million in 2022 from $53.6 million the year before, and Kohn noted “we will be reviewing strategic alternatives for Lovers’ future as part of the Playboy Group in the coming months.”

During the call, Kohn also admitted that CFO Barton will depart the company within the next three months and that the search is on for a new CFO.

Kohn expressed hope that the recently announced launch of a digital only version of Playboy Magazine will bring traffic to its online platform where “creators” are featured in cover shoots, fashion spreads and other adult content. While Playboy had been optimistic about income from the sale of digital NFT’s in 2021, that income stream has dried up. It reported revenue from “Creator and NFT” was just $800,000 in 2022, down from $11.9 million in 2021.

Kohn addressed difficulties with the development of its own products: “We have grown Playboy e-commerce from basically zero in 2020 to $22 million of revenue in 2022. But given the cost to build the team, develop private label products and acquire customers, the business still lost in excess of $7 million in 2022. Given the losses in operational complexity, we are exploring alternatives to significantly reduce or eliminate those losses altogether. One alternative would be to convert the business to a JV or a licensing deal. The second would be to shrink the revenue and SKU count and significantly reduced paid marketing. In both scenarios, the products will still be available at our website, and our customers will not experience any change. We will use our creator platform as the primary way to market the products.” — NM

The full conference call transcript can be found here:

https://seekingalpha.com/article/4588145-plby-group-inc-plby-q4-2022-earnings-call-transcript

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Published 03-20-2023 by Nick Monjo