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Originally Posted by slapass
How could AFF not be profitable?
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Quote:
Originally Posted by Slappin Fish
They make money. Problem is Penthouse (rebranding itself Friend Finders Networks) over leveraged themselves to buy aff. Servicing that debt is what is killing them...
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You really should not invest if you don't bother to do any research - Various, Inc, the company which owned AFF, and was purchased by the Penthouse Media Group, had been losing tens of millions a year, in the years prior to the sell.
While their was and is, lots of income, it was not a profitable business in recent years, and it is still not profitable.
From the FFN Prospectus (click on the link to see the entire FFN Prospectus):
We have historically generated significant net losses. As of September 30, 2009, we had an accumulated deficit of approximately $173.6 million. For the nine months ended September 30, 2009, we had a net loss of $27.4 million. For the years ended December 31, 2008, 2007 and 2006, we had net losses of approximately $46.0 million, $29.9 million and $49.9 million, respectively.
From another financial journal today:
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Aren't investors supposed to be ruthless believers in the shallowness and depravity of the human race? That seems to be the bet that FriendFinder Networks was making when the Boca Raton-based website promoter decided to stage an initial public offering. The pitch: This could feed the human sex drive in the same way that Facebook feeds human vanity. It already has a million subscribers.
Yet investment analysts are lukewarm about the company's chances. It's not just that they think investors are bashful about investing in porn; they say there's skepticism over whether the company, which changed its name from Penthouse Media Group in 2007, has made enough progress building profit in the the years since a bankruptcy filing.
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ADG