CEO Scott Flanders: “Our goal is to transition Playboy to a brand management company”
Playboy Enterprises is cutting the fat at the top.
In an ongoing effort to cut costs, the company announced on Tuesday that it is “downsizing its organizational structure.”
The company would not disclose how many layoffs it made as a result of the downsizing. A spokesperson for Playboy would only say it “eliminated some positions.”
But an individual with knowledge of the situation said the cuts are all high-ranking, highly-paid corporate executives.
Among them: two chiefs in the financial department, one in human resources and the head of administrative services. (All will get three months notice and then their severance.)
The downsizing is expected to save the company about $3 million annually, Playboy chief Scott Flanders said in a statement.
"Our goal is to transition Playboy to a brand management company and, in so doing, to more cost-effectively monetize our powerful brand and assets,” Flanders said. “As we proceed through this transformation, we are aggressively looking for opportunities to streamline our operations, consolidate functions and reduce overhead expense.”
“The downsizing announced today is not a reflection of our employees' talents and work ethic,” Flanders added, “but rather due to the overall change in the company's strategic direction."
The spokesperson said Playboy’s plan was to retain its “core competencies” including content creators and editorial staff.
In November, Playboy magazine outsourced everything but its editorial to American Media Inc., the publisher of the National Enquirer. (The magazine's ad revenue fell about 30 percent, or roughly $22 million, in 2009.)
At the end of March, there were 573 full-time staffers employed by Playboy – or 12 percent fewer than at the same point last year.
Last month, Playboy said that managed to cut its first quarter loss to about $1 million, compared to $13.7 million last year. It’s print and digital business posted a loss of $1 million, compared to $3.6 million last year. The company’s overall revenues declined 10.8 percent.