SAN FRANCISCO - PlanetOut owes $7 million by June 30, yet they are mum on whether they have any possible buyers for its adult division, Specialty Publications, which was put up for sale early this month. This is after reporting a near-$7 million loss for the first quarter of 2007 with a projected loss of $7-9 million for the year.
PlanetOut owes another $8 million by August 31, on top of another $7 million by the end of the year, and another $10 million, most of which is payable over the next four years.
In a report on Advocate.com, CFO Dan Miller said, "The first step is to get the company capitalized sufficiently. That's part of the logic in selling the adult business." He added that execs will talk "at length" about the company's capital commitments at the next earnings call, set to take place in early August.
Despite this being a time when advertising in gay media is at an all-time high, ad revenue at PlanetOut's Advocate and Out magazines is declining, especially at The Advocate, which plunged 41%.
PNO president Bob Cohen says the company is working on improvements to both magazines in terms of content and design. In fact, following a redesign of Out last year, The Advocate will premiere a redesign itself this September.
"A lot of the things we're doing now are really designed to have maximum impact during the second half of this year, when a lot of media buying decisions are being influenced and made," Cohen says. "The result of that will play out in 2008 with more to come in 2009." He also says that there is no "internal deadline" to reverse the sales drop. "Ordinarily, that's a process that would take 12-18 months," he says.
If they have that much time.
