Playboy, Inc 10-K for FY2021

Playboy, Inc. (PLBY)

10-K 2022-03-16 For: 2021-12-31

Added on April 10, 2026

About this 10-K

Playboy, Inc filed this 10-K on March 16, 2022, covering the fiscal year ended December 31, 2021 (FY2021).

Headline figures

Fiscal year ended December 31, 2021, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $246.59M; up 67.0% from $147.66M a year earlier
Net loss: $77.68M; compared with a net loss of $5.27M a year earlier
Diluted EPS: -$2.04; compared with -$0.24 a year earlier

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Delaware						37-1958714
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☒
		Emerging growth company	☐


			Page
Cautionary Note Regarding Forward-Looking Statements

Part I			5
Item 1. Business			5
Item 1A. Risk Factors			11
Item 1B. Unresolved Staff Comments			35
Item 2. Properties			35
Item 3. Legal Proceedings			36
Item 4. Mine Safety Disclosures			37

Part II			38
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities			38
Item 6 . [Reserved]			39
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations			39
Item 7A. Quantitative and Qualitative Disclosures About Market Risk			57
Item 8. Financial Statements and Supplementary Data			59
Index to Consolidated Financial Statements			59
Report of Independent Registered Public A ccounting Firm (BDO USA, LLP)			60
Report of Independent Registered Public Accounting Firm (Prager Metis CPAs LLP)			62
Consolidated Statements of Operations			63
Consolidated Statements of Comprehensive Loss			64
Consolidated Balance Sheets			65
Consolidated Statements of Stockholders’ Equity			66
Consolidated Statements of Cash Flows			67
Notes to the Consolidated Financial Statements			68
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosures			103
Item 9A. Controls and Procedures			103
Item 9B. Other Information			107
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections			107

Part III			108
Item 10. Directors, Executive Officers and Corporate Governance			108
Item 11. Executive Compensation			108
Item 12. Security Ownership of Certain Beneficial Owner s and Management and Related Stockholder Matters			108
Item 13. Certain Relationships and Related Transactions, and Director Independence			108
Item 14. Principal Accounting Fees and Services			108

Part IV			109
Item 15. Exhibits, Financial Statement Schedules			109
Item 16. Form 10-K Summary			112

Signatures			113


	Year Ended December 31,
	2021		2020		$ Change		% Change
Net revenues	$	246,586	$	147,662	$	98,924	67	%
Costs and expenses:
Cost of sales	(114,161)		(74,384)		(39,777)		53	%
Selling and administrative expenses	(200,063)		(58,659)		(141,404)		241	%
Related party expenses	(250)		(1,007)		757		(75)	%
Other operating expenses	(964)		—		(964)		*
Total costs and expenses	(315,438)		(134,050)		(181,388)		135	%
Operating (loss) income	(68,852)		13,612		(82,464)		*
Nonoperating (expense) income:
Interest expense	(13,312)		(13,463)		151		(1)	%
Loss on extinguishment of debt	(1,217)		—		(1,217)		*
Gain from settlement of convertible note	700		1,454		(754)		(52)	%
Other income, net	2,226		198		2,028		*
Total nonoperating expense	(11,603)		(11,811)		208		(2)	%
(Loss) income before income taxes	(80,455)		1,801		(82,256)		*
Benefit (expense) from income taxes	2,779		(7,072)		9,851		(139)	%
Net loss	(77,676)		(5,271)		(72,405)		*
Net loss attributable to PLBY Group, Inc.	$	(77,676)	$	(5,271)	$	(72,405)	*


	Year Ended December 31,
	2021		2020
Net revenues	100	%	100	%
Costs and expenses:
Cost of sales	(46.3)		(50.4)
Selling and administrative expenses	(81.1)		(39.7)
Related party expenses	(0.1)		(0.7)
Other operating expenses	(0.4)		—
Total costs and expenses	(127.9)		(90.8)
Operating (loss) income	(27.9)		9.2
Nonoperating (expense) income:
Interest expense	(5.4)		(9.1)
Loss on extinguishment of debt	(0.5)		—
Gain from settlement of convertible note	0.3		1.0
Other income, net	0.9		0.1
Total nonoperating expense	(4.7)		(8.0)
(Loss) income before income taxes	(32.6)		1.2
Benefit (expense) from income taxes	1.1		(4.8)
Net loss	(31.5)		(3.6)
Net (loss) income attributable to redeemable noncontrolling interest	—		—
Net loss attributable to PLBY Group, Inc.	(31.5)	%	(3.6)	%


☒			ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	Year Ended December 31,
	2021		2020
Net loss	$	(77,676)	$	(5,271)
Adjusted for:
Interest expense	13,312		13,463
Loss on extinguishment of debt	1,217		—
Benefit (expense) from income taxes	(2,779)		7,072
Depreciation and amortization	7,291		2,259
EBITDA	(58,635)		17,523
Adjusted for:
Stock-based compensation	58,446		2,988
Reduction in force expenses	—		3,165
Adjustments	9,413		1,880
Amortization of inventory step-up	8,089		3,230
Contingent consideration fair value remeasurement	2,369		—
Digital assets impairment	964		—
Management fees and expenses	250		1,007
Nonoperating expenses	—		(1,299)
Acquisition related costs	11,549		(109)
Adjusted EBITDA	$	32,445	$	28,385


			Page
Audited Consolidated Financial Statements:
Report of Independent Registered Public Accounting Firm (BDO USA, LLP; Los Angeles, California; PCAOB ID: # 243)			60
Report of Independent Registered Public Accounting Firm (Prager Metis CPAs LLP; El Segundo, California; PCAOB ID: # 4054)			62

Financial Statements:
Consolidated Statements of Operations			63
Consolidated Statements of Comprehensive Loss			64
Consolidated Balance Sheets			65
Consolidated Statements of Stockholders’ Equity			66
Consolidated Statements of Cash Flows			67
Notes to the Consolidated Financial Statements			68


	December 31,
	2021		2020
Assets
Current assets:
Cash and cash equivalents	$	69,245	$	13,430
Restricted cash	2,211		2,130
Receivables, net of allowance for credit losses	14,129		6,601
Inventories, net	39,881		11,788
Stock receivable	—		4,445
Prepaid expenses and other current assets	13,416		8,822
Total current assets	138,882		47,216
Restricted cash	4,030		—
Property and equipment, net	26,445		5,203
Operating right of use assets	38,746		—
Digital assets, net	6,836		—
Goodwill	270,577		504
Other intangible assets, net	418,444		339,032
Contract assets, net of current portion	17,315		7,159
Other noncurrent assets	14,132		13,013
Total assets	$	935,407	$	412,127
Liabilities and Stockholders’ Equity
Current liabilities:
Accounts payable	$	20,577	$	8,678
Accrued salaries, wages, and employee benefits	4,623		4,870
Deferred revenues, current portion	11,036		11,159
Long-term debt, current portion	2,808		4,470
Contingent consideration	36,630		—
Convertible promissory notes	—		6,230
Operating lease liabilities, current portion	9,697		—
Other current liabilities and accrued expenses	32,417		18,556
Total current liabilities	117,788		53,963
Deferred revenues, net of current portion	42,532		43,792
Long-term debt, net of current portion	226,042		154,230
Deferred tax liabilities, net	91,208		74,909
Operating lease liabilities, net of current portion	35,534		—
Other noncurrent liabilities	20		2,422
Total liabilities	513,124		329,316
Commitments and contingencies (Note 13)
Redeemable noncontrolling interest	(208)		(208)
Stockholders’ equity:
Common stock, $0.0001 par value; 150,000,000 shares authorized at December 31, 2021 and 2020; 42,996,191 shares issued and 42,296,191 shares outstanding at December 31, 2021; 20,626,249 shares issued and outstanding at December 31, 2020	4		2
Treasury stock, at cost: 700,000 shares and 0 shares at December 31, 2021 and 2020	(4,445)		—
Additional paid-in capital	586,349		161,033
Accumulated other comprehensive loss	(3,725)		—
Accumulated deficit	(155,692)		(78,016)
Total stockholders’ equity	422,491		83,019
Total liabilities, redeemable noncontrolling interest, and stockholders’ equity	$	935,407	$	412,127


	Common stock
	Shares	Amount		Treasury stock		Additional paid-in capital		Accumulated deficit		Accumulated other comprehensive loss		Total
Balance at December 31, 2019, as previously reported	3,681,185	$	36	$	(23,453)	$	184,452	$	(78,016)	$	—	$	83,019
Retroactive application of recapitalization	16,945,064	(34)		23,453		(23,419)		—		—		—
Balance at December 31, 2019, effect of reverse acquisition (Note 1)	20,626,249	2		—		158,045		(72,745)		—		85,302
Stock-based compensation expense and vesting of restricted stock units	—	—		—		2,988		—		—		2,988
Net loss	—	—		—		—		(5,271)		—		(5,271)
Balance at December 31, 2020	20,626,249	$	36	$	—	$	161,033	$	(78,016)	$	—	$	83,019
Conversion of convertible promissory note	290,563	—		—		2,730		—		—		2,730
Business combination and PIPE financing	12,644,168	1		(4,445)		99,618		—		—		95,174
Secondary offering	4,720,000	1		—		202,894		—		—		202,895
Shares issued in connection with unit purchase options exercise, net exercised	247,976	—		—		—		—		—		—
Shares issued in connection with employee stock plans	301,063	—		—		—		—		—		—
Shares issued pursuant to trademark licensing agreement	109,291	—		—		5,000		—		—		5,000
Shares issued in connection with the acquisition of Honey Birdette	2,160,261	—		—		30,006		—		—		30,006
Shares issued upon exercise of stock options	608,775	—		—		2,329		—		—		2,329
Shares issued in connection with the acquisition of GlowUp	548,034	—		—		15,126		—		—		15,126
Contingent consideration in relation to acquisition of GlowUp	—	—		—		9,167		—		—		9,167
Shares issued pursuant to a license, services and collaboration agreement	39,741	—		—		1,500		—		—		1,500
Stock-based compensation expense and vesting of restricted stock units	—	—		—		56,946		—		—		56,946
Other comprehensive loss	—	—		—		—		—		(3,725)		(3,725)
Net loss	—	—		—		—		(77,676)		—		(77,676)
Balance at December 31, 2021	42,296,121	$	4	$	(4,445)	$	586,349	$	(155,692)	$	(3,725)	$	422,491


Cash - trust account and cash	$	54,044
Cash - PIPE Investment	46,844
Less: transaction costs paid in 2021	(977)
Net contributions from Merger and PIPE Investment	99,911
Less: transaction costs paid in 2020	(292)
Merger and PIPE Investment	$	99,619


	December 31, 2021
	Level 1		Level 2		Level 3		Total
Liabilities
Contingent consideration liability	$	—	$	—	$	(36,630)	$	(36,630)


	December 31, 2020
	Level 1		Level 2		Level 3		Total
Liabilities
PSARs liability	$	—	$	—	$	(858)	$	(858)


	December 31, 2021
Beginning balance	$	858
Issuance of contingent consideration in connection with our acquisitions	34,390
PSARs liability settlement	(846)
Change in fair value and other	2,228
Ending balance	$	36,630


	Year Ended December 31,
	2021		2020
Net revenues
Licensing	$	64,021	$	61,142
Direct-to-consumer	147,848		64,116
Digital subscriptions and content	33,756		20,913
All other	961		1,491
Total	$	246,586	$	147,662

Operating (loss) income
Licensing	47,477		44,466
Direct-to-consumer	(2,836)		(752)
Digital subscriptions and content	7,882		9,478
Corporate	(121,955)		(38,462)
All other	580		(1,118)
Total	$	(68,852)	$	13,612


	Year Ended December 31,
	2021		2020
Net cash provided by (used in):
Operating activities	$	(36,742)	$	813
Investing activities	$	(273,176)	$	(5,470)
Financing activities	$	370,474	$	(8,490)


	Year Ended December 31,
	2021			2020
Customer	Receivables		Revenue	Receivables		Revenue
Customer A	30	%	*	*		11	%
Customer B	15	%	*	30	%	*
Customer C	*		*	*		15	%
*Indicates the revenues or receivables for the customer did not exceed 10% of the Company’s total in each category as of or for the years ended December 31, 2021 or 2020.


	Year Ended December 31, 2021
	Licensing		Direct-to-consumer		Digital subscriptions and content		Other		Total
Trademark licensing	$	64,021	$	—	$	2,034	$	—	$	66,055
Magazine, digital subscriptions and product	—		—		21,268		799		22,067
TV and cable programming	—		—		10,454		162		10,616
Consumer products	—		147,848		—		—		147,848
Total revenues	$	64,021	$	147,848	$	33,756	$	961	$	246,586


	Year Ended December 31, 2020
	Licensing		Direct-to-consumer		Digital subscriptions and content		Other		Total
Trademark licensing	$	61,142	$	—	$	2,420	$	—	$	63,562
Magazine, digital subscriptions and product	—		—		8,658		771		9,429
TV and cable programming	—		—		9,835		692		10,527
Consumer products	—		64,116		—		28		64,144
Total revenues	$	61,142	$	64,116	$	20,913	$	1,491	$	147,662


	Weighted- Average Life (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
December 31, 2021
Trade names	11.8	$	85,684	$	(3,293)	$	82,391
Distribution agreements	15	3,720		(2,687)		1,033
Photo and magazine archives	10	2,000		(2,000)		—
Customer list	10	1,180		(236)		944
Developed technology	3	2,300		(149)		2,151
Total		$	94,884	$	(8,365)	$	86,519


	Weighted- Average Life (Years)	Gross Carrying Amount		Accumulated Amortization		Net Carrying Amount
December 31, 2020
Distribution agreements	15	$	3,720	$	(2,438)	$	1,282
Photo and magazine archives	10	2,000		(1,967)		33
Licensing agreements	9	5,913		(5,913)		—
Customer list	10	1,180		(118)		1,062
Total		$	12,813	$	(10,436)	$	2,377


2022	$	8,430
2023	8,430
2024	8,281
2025	7,663
2026	7,457
Thereafter	46,258
Total	$	86,519


Balance at December 31, 2020	$	504
Acquisition of TLA	16,374
Acquisition of Honey Birdette	223,381
Acquisition of GlowUp	32,603
Foreign currency translation adjustment	(2,285)
Balance at December 31, 2021	$	270,577


2022	$	3,206
2023	3,265
2024	3,327
2025	3,396
2026	6,875
Thereafter	217,350
Total	$	237,419


	Number of options	Weighted- average exercise price		Weighted- average remaining contractual term (years)	Aggregate intrinsic value (in thousands)
Balance – December 31, 2020	2,594,597	$	3.79	8.5	$	13,791
Granted (1)	1,225,249	$	14.24
Exercised	(608,775)	$	3.83		$	20,207
Forfeited	—	—
Cancelled	—	—
Balance – December 31, 2021	3,211,071	$	7.77	7.9	$	60,978
Exercisable – December 31, 2021	1,985,822	$	3.77	7.1	$	45,407
Vested and expected to vest as of December 31, 2021	3,211,071	$	7.77	7.9	$	60,978


	Number of awards	Weighted- average grant date fair value per share
Unvested and outstanding balance at December 31, 2020	313,976	$	4.30
Granted	679,562	$	28.22
Vested	(404,992)	$	9.77
Forfeited	(3,471)	$	28.08
Unvested and outstanding balance at December 31, 2021	585,075	$	28.15


	Year Ended December 31, 2021
Operating lease cost	$	9,099
Variable lease cost	1,370
Short-term lease cost	674
Sublease income	(368)
Net lease cost	$	10,775


Years ending December 31:	Amounts
2022	$	11,447
2023	9,894
2024	8,314
2025	6,588
2026	6,131
Thereafter	7,393
Total undiscounted lease payments	49,767
Less: imputed interest	(4,536)
Total operating lease liabilities	$	45,231
Operating lease liabilities, current portion	9,697
Operating lease liabilities, noncurrent portion	$	35,534


	Minimum Lease Commitments		Sublease Income
2021	$	3,433	$	(288)
2022	3,451		(313)
2023	3,564		(322)
2024	3,828		(246)
2025	3,588		—
Thereafter	7,553		—
Total	$	25,417	$	(1,169)


Tangible net assets and liabilities:
Inventory	$	7,614
Property and equipment	1,665
Accounts payable	(1,319)
Other net assets	(3,518)
Total net assets	4,442
Intangible assets:
Trade name	4,100
Total intangible assets	4,100
Net assets acquired	8,542
Purchase consideration	24,916
Goodwill	$	16,374



Net revenues	$	44,739
Costs and expenses
Cost of sales	(19,122)
Selling and administrative expenses	(22,737)
Total costs and expenses	(41,859)
Operating income	2,880
Nonoperating income	5
Income taxes expense	(24)
Net income	$	2,861


Cash consideration	$	233,441
Stock consideration:
Transferred shares (1)	29,889
Lock-up shares (2)	25,460
Total consideration transferred	$	288,790


Net assets and liabilities:
Cash	$	3,950
Inventory	16,015
Property and equipment	5,185
Other tangible net assets (liabilities)	(12,243)
Unfavorable leasehold interest, net	(1,690)
Trade name	77,238
Deferred tax liability	(23,046)
Total net assets acquired	65,409
Purchase consideration	288,790
Goodwill	$	223,381



Net revenues	$	32,288
Costs and expenses:
Cost of sales	(14,445)
Selling and administrative expenses	(17,341)
Total costs and expenses	(31,786)
Operating income	502
Nonoperating income	559
Benefit (expense) from income taxes	2,162
Net income	$	3,223


Cash consideration (including transaction expenses paid for sellers)	$	1,142
Stock consideration	15,126
Contingent consideration	18,097
Total consideration transferred	$	34,365


	Year Ended December 31,
Net revenues:	2021		2020
China	$	43,535	$	42,569
United States	152,410		76,365
Australia	21,379		4
UK	6,156		5,077
Other	23,106		23,647
Total	$	246,586	$	147,662


	December 31,
Long-lived assets:	2021		2020
Australia	$	6,767	$	—
United States	57,401		5,203
Other	1,023		—
Total	$	65,191	$	5,203


Exhibit No.						Description
2.1*						Agreement and Plan of Merger, dated as of September 30, 2020, by and among Mountain Crest Acquisition Corp, MCAC Merger Sub Inc., Suying Liu and Playboy Enterprises, Inc. (incorporated by reference to Annex A to MCAC’s Preliminary Proxy Statement file with the SEC on November 9, 2020).
2.2*						Share Purchase Agreement, dated June 28, 2021, by and among PLBY Group, Inc., PLBY Australia Pty Ltd, Honey Birdette (Aust) Pty Limited, the sellers party thereto, and Ray Itaoui, as the sellers’ representative (incorporated by reference to Exhibit 2.1 of PLBY’s Current Report on Form 8-K filed with the SEC on June 29, 2021)
3.1						Second Amended and Restated Certificate of Incorporation of PLBY Group, Inc. (incorporated by reference to Exhibit 3.1 of PLBY’s Form 8-K filed with the SEC on February 16, 2021)
3.2						Amended and Restated Bylaws of PLBY Group, Inc. (incorporated by reference to Exhibit 3.2 of PLBY’s Form 8-K filed with the SEC on February 16, 2021)
4.1						Description of registered securities.
10.1						Form of Subscription Agreement, dated as of September 30, 2020, by and among Mountain Crest Acquisition Corp and certain institutional and accredited investors (incorporated by reference to Exhibit 10.1 of MCAC’s Current Report on Form 8-K filed with the SEC on October 1, 2020).
10.2						Form of Registration Rights Agreement, dated as of September 30, 2020, by and among Mountain Crest Acquisition Corp and certain institutional and accredited investors (incorporated by reference to Exhibit 10.2 of MCAC’s Current Report on Form 8-K filed with the SEC on October 1, 2020).
10.3						Form of Support Agreement, dated as of September 30, 2020, by and among Playboy Enterprises, Inc., officers and directors of Mountain Crest Acquisition Corp, Sunlight Global Investment LLC, Suying Liu and Dong Liu (incorporated by reference to Exhibit 10.3 of MCAC’s Current Report on Form 8-K filed with the SEC on October 1, 2020).
10.4						Amended and Restated Registration Rights Agreement, dated as of February 10, 2021, by and among PLBY Group, Inc., Suying Liu, Dong Liu, Nelson Haight, Todd Milbourn, Wenhua Zhang, RT-ICON Holdings LLC, and each of the other shareholders of Playboy Enterprises, Inc. whose names are listed on Exhibit A thereto (incorporated by reference to Exhibit 10.4 of PLBY’s Form 8-K filed with the SEC on February 16, 2021).
10.5						Investor Rights Agreement, dated as of February 10, 2021, by and among PLBY Group, Inc. and RT-ICON Holdings LLC (incorporated by reference to Exhibit 10.5 of PLBY’s Form 8-K filed with the SEC on February 16, 2021).
10.6						Form of Lock-Up Agreement (incorporated by reference to Exhibit 10.6 of MCAC’s Current Report on Form 8-K filed with the SEC on October 1, 2020).
10.7						Voting Agreement, dated as of February 10, 2021, by and among PLBY Group, Inc., RT-ICON Holdings LLC and Drawbridge Special Opportunities Fund LP (incorporated by reference to Exhibit 10.7 of PLBY’s Form 8-K filed with the SEC on February 16, 2021).
10.8†						PLBY Group, Inc. 2021 Equity and Incentive Compensation Plan (incorporated by reference to Exhibit 10.8 of PLBY’s Form 8-K filed with the SEC on February 16, 2021).
10.9						Letter Agreement, dated June 4, 2020 by and between MCAC and Sunlight Global Investment LLC (incorporated by reference to Exhibit 10.6 of MCAC’s Form 8-K filed with the SEC on October 1, 2020).