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PRVT » Topics » Nine months ended September 30, 2007 compared to the nine months ended September 30, 2006These excerpts taken from the PRVT 10-K filed Apr 15, 2009. 2007 compared to 2006 Net sales. Our net sales in 2007 were EUR 25.0 million compared to EUR 29.2 million in 2006, a decrease of EUR 4.2 million, or 14%. The decrease was the result of reduced DVD & Magazine and Broadcasting sales offset by increased Internet and Wireless sales. Net sales in general were affected by the weakening dollar by EUR 0.4 million DVD & Magazine sales decreased EUR 4.0 million, or 27%, to EUR 10.9 million. The reduction in DVD & Magazine sales was primarily attributable to an industry wide decrease in DVD sales (see discussion under Outlook below). Despite the weakening dollar, Internet sales increased EUR 0.1 million to EUR 4.4 million, which represents an increase of 3% compared to the same period last year. Broadcasting sales decreased EUR 1.0 million, or 12%, to EUR 7.1 million. The decrease was primarily the result of the discontinuing of low margin pay-per-view sales in the US and last year non-recurring Pay-TV license sales in Europe totaling EUR 2.3 million offset by EUR 1.3 million from new broadcasting business primarily in Europe. Wireless sales increased EUR 0.6 million, or 32%, to EUR 2.6 million as a result our content being available with more operators. Net sales in general were affected by changes in exchange rates. The annual average dollar exchange rate for the fiscal year 2007 compared to 2006 decreased 9% which reduced all our sales in dollar by the same percentage. Fluctuations in exchange rates between the euro and the dollar can affect the comparability of our results from year to year. We translate our consolidated subsidiaries whose functional currency is not the euro into the euro for reporting purposes. Income statement amounts are translated into euros using the average exchange rate for the fiscal year. The balance sheet is translated at the year-end exchange rate. Cost of Sales. Our cost of sales was EUR 12.3 million for 2007 compared to EUR 14.1 million for 2006, a decrease of EUR 1.8 million, or 13%. Cost of sales as a percentage of sales was 49% for 2007, an increase of one percentage unit compared to 2006. We incur no cost of sales in dollars and subsequently we did not benefit from the weakening dollar in 2007 compared to 2006. Included in cost of sales is printing, processing and duplication, amortization of library and Internet, broadcasting and wireless costs. Printing, processing and duplication cost was EUR 4.1 million for 2007 compared to EUR 5.6 million for 2006, a decrease of EUR 1.5 million, or 27%. The decrease was primarily the result of a decrease in sales of magazines and DVDs. Printing, processing and duplication cost as a percentage of DVD & Magazine sales was 37% for the 2007 compared to 38% for the same period last year. Amortization of library was EUR 6.8 million for 2007 compared to EUR 6.7 million for 2006, an increase of EUR 0.1 million, or 2%. Amortization of library does not vary with sales since it reflects the amortization of our investments in content which has been available for sale for a period of three to five years. The increase was the result of higher amounts invested in content released during the period subject to amortization in 2007 compared to 2006. Internet, broadcasting and wireless costs was EUR 1.4 million for 2007 compared to EUR 1.9 million for 2006, a decrease of EUR 0.5 million. Internet, Broadcasting and Wireless cost as a percentage of related sales was 10% for 2007 compared to 13% for the same period last year. The decrease was primarily related to reduced broadcasting transmission costs related to pay-per-view sales in the US. Gross Profit. Our gross profit for 2007 was EUR 12.7 million, or 51% of net sales, compared to EUR 15.1 million, or 52% of
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net sales for 2006. This represented a decrease of EUR 2.4 million, or 16%, compared to 2006. Gross profit as a percentage of sales was down one percentage unit for 2007 compared to 2006. The decrease in gross profit of EUR 2.4 million was primarily the result of a EUR 2.5 million decrease in contribution to gross profit from DVD & Magazine sales offset by a EUR 0.2 million increase in contribution to gross profit from Internet, Broadcasting and Wireless sales. Our gross profit was affected by the weakening dollar in 2007 by EUR 0.4 million compared to 2006. Selling, general and administrative expenses. Our selling, general and administrative expenses were EUR 13.6 million for 2007 compared to EUR 14.0 million for 2006, a decrease of EUR 0.4 million, or 3%. We attribute the decrease in selling, general and administrative expenses to a reduction in payroll, general expenses and depreciation of EUR 0.6 million offset by an increase in bad debt provision of EUR 0.2 million. Operating profit/loss. We reported operating loss of EUR 0.9 million for 2007 compared to an operating profit of EUR 1.0 million for 2006, a decrease of EUR 1.9 million. The decrease in operating profit was primarily the result of the decrease in gross profit offset by reduced selling, general and administrative expenses. Interest expense. Our interest expense was EUR 0.3 million for 2007, compared to EUR 0.6 million for 2006. The decrease is the result of less average borrowings outstanding in 2007 compared to 2006. Income tax benefit from continuing operations. Our income tax benefit was EUR 0.5 million for 2007, compared to 0.5 million for 2006. Income/loss from continuing operations. Loss from continuing operations was EUR 0.4 million for 2007, compared to an income of EUR 1.1 million for 2006. We attribute the decrease in 2007 of EUR 1.5 million to decreased operating profit offset by reduced interest expense. Loss from discontinued operations. Our loss from discontinued operations was EUR 0.9 million for 2006. Income tax benefit from discontinued operations. Our income tax benefit from discontinued operations was EUR 0.3 million in 2006. Net Income/loss. Our net loss was EUR 0.4 million for 2007, compared to a net income of EUR 0.5 million for 2006. We attribute the decrease in net income in 2007 of EUR 0.9 million primarily to decreased income from continuing operations offset by decreased loss from discontinued operations. 2007 compared to 2006
decreased 9% which reduced all our sales in dollar by the same percentage. Fluctuations in exchange rates between the euro and the dollar can affect the comparability of our results from year to year. We translate our consolidated subsidiaries whose functional currency is not the euro into the euro for reporting purposes. Income statement amounts are translated into euros using the average exchange rate for the fiscal year. The balance sheet is translated at the year-end exchange rate. Cost of Sales. Our cost of sales was EUR 12.3 million for 2007 compared to EUR 14.1 million for 2006, a decrease of EUR Included in cost of sales is printing, processing and duplication, amortization of library and Internet, broadcasting Gross Profit. Our gross profit for 2007 was EUR
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14.0 million for 2006, a decrease of EUR 0.4 million, or 3%. We attribute the decrease in selling, general and administrative expenses to a reduction in payroll, general expenses and depreciation of EUR 0.6 million offset by an increase in bad debt provision of EUR 0.2 million. Operating profit/loss. We reported operating loss of EUR 0.9 million for Interest expense. Our interest expense was EUR 0.3 million for 2007, compared to EUR 0.6 million for 2006. The Income tax benefit from continuing Income/loss from Loss from discontinued operations. Our loss from discontinued operations was EUR 0.9 million for Income tax benefit from discontinued operations. Our income tax benefit from discontinued operations was EUR 0.3 million Net Income/loss. Our net loss was EUR 0.4 million for 2007, compared to a net income of EUR 0.5 million for We generate cash December 31, 2007. The decrease was attributable to a decrease in current assets offset by a decrease in current liabilities. We reported a working capital surplus of EUR 19.6 million at December 31, 2007, a decrease of EUR 1.4 million compared to the year ended December 31, 2006. The decrease was attributable to an increase in current liabilities and a decrease in current assets. Net cash provided by our operating activities was EUR 5.2 million for 2008
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Net cash provided by our operating Net cash provided by our operating activities was EUR 7.4 million for 2006 compared to EUR 4.4 million SIZE="2">Investing Activities Net cash used in investing activities for the fiscal year ended December 31, 2008 was EUR 5.4 Net cash used in investing SIZE="2">Net cash used in investing activities for the fiscal year ended December 31, 2006 was EUR 7.1 million. The investing activities were investment in library of photographs and videos of EUR 6.5 million, which were carried out in
- 39 - This excerpt taken from the PRVT 10-K filed Mar 17, 2008. 2007 compared to 2006 Net sales. Our net sales in 2007 were EUR 25.0 million compared to EUR 29.2 million in 2006, a decrease of EUR 4.2 million, or 14%. The decrease was the result of reduced DVD & Magazine and Broadcasting sales offset by increased Internet and Wireless sales. Net sales in general were affected by the weakening dollar. DVD & Magazine sales decreased EUR 4.0 million, or 27%, to EUR 10.9 million. The reduction in DVD & Magazine sales was primarily attributable to an industry wide decrease in DVD sales (see discussion under Outlook below). Despite the weakening dollar, Internet sales increased EUR 0.1 million to EUR 4.4 million, which represents an increase of 3% compared to the same period last year. Broadcasting sales decreased EUR 1.0 million, or 12%, to EUR 7.1 million. The decrease was primarily the result of the discontinuing of low margin pay-per-view sales in the US and last year non-recurring Pay-TV license sales in Europe totaling EUR 2.3 million offset by EUR 1.3 million from new broadcasting business primarily in Europe. Wireless sales increased EUR 0.6 million, or 32%, to EUR 2.6 million as a result our content being available with more operators. Going forward, we expect Internet, Broadcasting and Wireless sales to increase (see discussion under Outlook below). Net sales in general were affected by changes in exchange rates. The annual average dollar exchange rate for the fiscal year 2007 compared to 2006 decreased 9% which reduced all our sales in dollar by the same percentage. Fluctuations in exchange rates between the euro and the dollar can affect the comparability of our results from year to year. We translate our consolidated subsidiaries whose functional currency is not the euro into the euro for reporting purposes. Income statement amounts are translated into euros using the average exchange rate for the fiscal year. The balance sheet is translated at the year-end exchange rate. Cost of Sales. Our cost of sales was EUR 12.3 million for 2007 compared to EUR 14.1 million for 2006, a decrease of EUR 1.8 million, or 13%. Cost of sales as a percentage of sales was 49% for 2007, an increase of one percentage unit compared to 2006. We incur no cost of sales in dollars and subsequently we did not benefit from the weakening dollar in 2007 compared to 2006. Included in cost of sales is printing, processing and duplication, amortization of library and Internet, broadcasting and wireless costs. Printing, processing and duplication cost was EUR 4.1 million for 2007 compared to EUR 5.6 million for 2006, a decrease of EUR 1.5 million, or 27%. The decrease was primarily the result of a decrease in sales of magazines and DVDs. Printing, processing and duplication cost as a percentage of DVD & Magazine sales was 37% for the 2007 compared to 38% for the same period last year. Amortization of library was EUR 6.8 million for 2007 compared to EUR 6.7 million for 2006, an increase of EUR 0.1 million, or 2%. Amortization of library does not vary with sales since it reflects the amortization of our investments in content which has been available for sale for a period of three to five years. The increase was the result of higher amounts invested in content released during the period subject to amortization in 2007 compared to 2006. Internet, broadcasting and wireless costs was EUR 1.4 million for 2007 compared to EUR 1.9 million for 2006, a decrease of EUR 0.5 million. Internet, Broadcasting and Wireless cost as a percentage of related sales was 10% for 2007 compared to 13% for the same period last year. The decrease was primarily related to reduced broadcasting transmission costs related to pay-per-view sales in the US. Gross Profit. Our gross profit for 2007 was EUR 12.7 million, or 51% of net sales, compared to EUR 15.1 million, or 52% of net sales for 2006. This represented a decrease of EUR 2.4 million, or 16%, compared to 2006. Gross profit as a percentage of sales was down one percentage unit for 2007 compared to 2006. The decrease in gross profit of EUR 2.4 million was primarily the result of a EUR 2.5 million decrease in contribution to gross profit from DVD & Magazine sales offset by a EUR 0.2 million increase in
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contribution to gross profit from Internet, Broadcasting and Wireless sales. Our gross profit was affected by the weakening dollar in 2007 by EUR 4.0 million compared to 2006. Selling, general and administrative expenses. Our selling, general and administrative expenses were EUR 13.6 million for 2007 compared to EUR 14.0 million for 2006, a decrease of EUR 0.4 million, or 3%. We attribute the decrease in selling, general and administrative expenses to a reduction in payroll, general expenses and depreciation of EUR 0.6 million offset by an increase in bad debt provision of EUR 0.2 million. Operating profit/loss. We reported operating loss of EUR 0.9 million for 2007 compared to an operating profit of EUR 1.0 million for 2006, a decrease of EUR 1.9 million. The decrease in operating profit was primarily the result of the decrease in gross profit offset by reduced selling, general and administrative expenses. Interest expense. Our interest expense was EUR 0.3 million for 2007, compared to EUR 0.6 million for 2006. The decrease is the result of less average borrowings outstanding in 2007 compared to 2006. Income tax benefit from continuing operations. Our income tax benefit was EUR 0.5 million for 2007, compared to 0.5 million for 2006. Income/loss from continuing operations. Loss from continuing operations was EUR 0.4 million for 2007, compared to an income of EUR 1.1 million for 2006. We attribute the decrease in 2007 of EUR 1.5 million to decreased operating profit offset by reduced interest expense. Loss from discontinued operations. Our loss from discontinued operations was EUR 0.9 million for 2006. Income tax benefit from discontinued operations. Our income tax benefit from discontinued operations was EUR 0.3 million in 2006. Net Income/loss. Our net loss was EUR 0.4 million for 2007, compared to a net income of EUR 0.5 million for 2006. We attribute the decrease in net income in 2007 of EUR 0.9 million primarily to decreased income from continuing operations offset by decreased loss from discontinued operations. This excerpt taken from the PRVT 10-Q filed Nov 9, 2007. Nine months ended September 30, 2007 compared to the nine months ended September 30, 2006 Net sales. For the nine months ended September 30, 2007, we had net sales of EUR 18.9 million compared to net sales of EUR 21.8 million for the nine months ended September 30, 2006, a decrease of EUR 2.9 million, or 13%. The decrease was the result of reduced DVD & Magazine sales offset by increased Internet, Broadcasting and Wireless sales. DVD & Magazine sales decreased EUR 3.3 million, or 30%, to EUR 7.7 million. The reduction in DVD & Magazine sales was primarily attributable to an industry wide decrease in DVD sales (see discussion under Outlook below). Internet sales increased EUR 0.2 million to EUR 3.5 million, which represents an increase of 6% compared to the same period last year. Broadcasting sales decreased EUR 0.4 million, or 7%, to EUR 5.8 million. The decrease was primarily the result of the discontinuing of low margin pay-per-view sales in the US and last year non-recurring Pay-TV license sales in Europe totaling EUR 1.5 million offset by EUR 1.1 million from new broadcasting business primarily in Europe. Wireless sales increased EUR 0.6 million, or 48%, to EUR 1.9 million as a result our content being available with more operators. Going forward, we expect Internet, Wireless and Broadcasting sales to increase (see discussion under Outlook below). Cost of Sales. Our cost of sales was EUR 10.2 million for the nine months ended September 30, 2007 compared to EUR 10.5 million for the nine months ended September 30, 2006, a decrease of EUR 0.3 million, or 3%. Included in cost of sales is printing, processing and duplication, amortization of library and Internet, broadcasting and wireless costs. Printing, processing and duplication cost was EUR 4.0 million for the nine months ended September 30, 2007 compared to EUR 4.3 million for the nine months ended September 30, 2006, a decrease of EUR 0.3 million, or 7%. Printing, processing and duplication cost as a percentage of DVD & Magazine sales was 51% for the nine months ended September 30, 2007 compared to 39% for the same period last year. The increase in cost of sales percentage was the result of higher DVD & Magazine sales volume at lower margins in the third quarter (see discussion for the three month period above). Amortization of library was EUR 5.0 million for the nine months ended September 30, 2007 compared to EUR 4.9 million for the nine months ended September 30, 2006, which represents an increase of EUR 0.1 million. Amortization of library does not vary with sales since it reflects the amortization of our investments in content which has been available for sale for a period of three to five years. Internet, Broadcasting and Wireless cost was EUR 1.2 million for the nine months ended September 30, 2007 compared to EUR 1.4 million for the nine months ended September 30, 2006. Internet, Broadcasting and Wireless cost as a percentage of related sales was 11% for the nine months ended September 30, 2007 compared to 13% for the same period last year. The decrease was primarily related to reduced broadcasting transmission costs related to pay-per-view sales in the US.
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EUR 1.4 million for the nine months ended September 30, 2006. Internet, Broadcasting and Wireless cost as a percentage of related sales was 11% for the nine months ended September 30, 2007 compared to 13% for the same period last year. The decrease was primarily related to reduced broadcasting transmission costs related to pay-per-view sales in the US. Gross Profit. In the nine months ended September 30, 2007, we realized a gross profit of EUR 8.7 million, or 46% of net sales compared to EUR 11.3 million, or 52% of net sales for the nine months ended September 30, 2006. The decrease in gross profit of EUR 2.6 million was primarily the result of a reduction in DVD and Magazine gross profit of EUR 3.0 million offset by an increase of EUR 0.6 million in gross profit from Internet, Broadcasting and Wireless sales. Selling, general and administrative expenses. Our selling, general and administrative expenses were EUR 9.3 million for the nine months ended September 30, 2007 compared to EUR 10.1 million for the nine months ended September 30, 2006, a decrease of EUR 0.8 million, or 8%. The decrease is primarily the result of reduced payroll, general expenses and depreciation of EUR 1.1 million offset by an increase of EUR 0.3 million in bad debt provisions. Operating profit/loss. We reported an operating loss of EUR 0.6 million for the nine months ended September 30, 2007 compared to a EUR 1.2 million in operating profit for the nine months ended September 30, 2006. The decrease in operating profit of EUR 1.8 million was primarily the result of the decrease in gross profit offset by reduced selling, general and administrative expenses. Interest expense. We reported interest expense of EUR 0.2 million for the nine months ended September 30, 2007, compared to EUR 0.5 million for the nine months ended September 30, 2006. The decrease in interest expense was primarily the result of less borrowings outstanding during the period. Income tax benefit from continuing operations. We reported income tax benefit of EUR 0.6 million for the nine months ended September 30, 2007, compared to EUR 0.5 million for the nine months ended September 30, 2006. Income/Loss from continuing operations. We reported a loss from continuing operations of EUR 0.1 million for the nine months ended September 30, 2007, compared to EUR 1.4 million in income from continuing operations for the nine months ended September 30, 2006. We attribute the decrease in income from continuing operations in 2007 to a decrease in operating profit offset by reduced interest expense and increased income tax benefit. Loss from discontinued operations. Our loss from discontinued operations for the nine months ended September 30, 2006 was EUR 0.4 million. Net Income/loss. We reported a loss of EUR 0.1 million for the nine months ended September 30, 2007, compared to EUR 1.0 million in net income for the nine months ended September 30, 2006. We attribute the decrease in net income in the period to decreased income from continuing operations offset by the absence of loss from discontinued operations we reported in the nine month period ended September 30, 2006.
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This excerpt taken from the PRVT 10-Q filed Aug 9, 2007. Six months ended June 30, 2007 compared to the six months ended June 30, 2006 Net sales. For the six months ended June 30, 2007, we had net sales of EUR 11.5 million compared to net sales of EUR 14.1 million for the six months ended June 30, 2006, a decrease of EUR 2.6 million, or 19%. DVD & Magazine sales decreased EUR 2.7 million, or 36%, to EUR 4.7 million. The reduction in DVD & Magazine sales was primarily attributable to an industry wide decrease in DVD sales, see discussion under Outlook below. Internet sales was EUR 2.1 million, which represents no change compared to the same period last year. Broadcasting sales decreased EUR 0.5 million, or 13%, to EUR 3.3 million primarily as a result of a decrease in pay-per-view sales in the US. Wireless sales increased EUR 0.5 million, or 69%, to EUR 1.3 million as a result our content being available with more operators. Going forward, we expect Internet, wireless and Broadcasting sales to increase (see discussion under Outlook below). Cost of Sales. Our cost of sales was EUR 6.2 million for the six months ended June 30, 2007 compared to EUR 7.4 million for the six months ended June 30, 2006, a decrease of EUR 1.2 million, or 16%. Included in cost of sales is printing, processing and duplication, amortization of library and Internet, broadcasting and wireless costs. Printing, processing and duplication cost was EUR 1.9 million for the six months ended June 30, 2007 compared to EUR 3.2 million for the six months ended June 30, 2006, a decrease of EUR 1.3 million, or 39%. The decrease was primarily the result of a reduction in related sales. Printing, processing and duplication cost as a percentage of DVD & Magazine sales was 41% for the six months ended June 30, 2007, which represents a decrease of 2%. The decrease was the result of sales mix. Amortization of library was EUR 3.4 million for the six months ended June 30, 2007 compared to EUR 3.3 million for the six months ended June 30, 2006, which represents an increase of EUR 0.1 million. Amortization of library does not vary with sales
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since it reflects the amortization of our investments in content which has been available for sale for a period of three to five years. Internet, Broadcasting and Wireless cost was EUR 0.8 million for the six months ended June 30, 2007 compared to EUR 0.9 million for the six months ended June 30, 2006. Internet, Broadcasting and Wireless cost as a percentage of related sales was 12% for the six months ended June 30, 2007, which represents a decrease of 1%. The decrease was primarily related to reduced broadcasting transmission costs related to pay-per-view sales in the US. Gross Profit. In the six months ended June 30, 2007, we realized a gross profit of EUR 5.3 million, or 46% of net sales compared to EUR 6.7 million, or 47% of net sales for the six months ended June 30, 2006. The decrease in gross profit as a percentage of sales was primarily the result of amortization of library, which does not vary with sales. Selling, general and administrative expenses. Our selling, general and administrative expenses were EUR 6.2 million for the six months ended June 30, 2007 compared to EUR 6.7 million for the six months ended June 30, 2006, a decrease of EUR 0.5 million, or 7%. The decrease is primarily the result of reduced general expenses. Operating profit/loss. We reported an operating loss of EUR 0.9 million for the six months ended June 30, 2007 compared to no operating profit for the six months ended June 30, 2006. The decrease in operating profit of EUR 0.9 million was primarily the result of the decrease in gross profit offset by reduced selling, general and administrative expenses. Interest expense. We reported interest expense of EUR 0.2 million for the six months ended June 30, 2007, compared to EUR 0.3 million for the six months ended June 30, 2006. The decrease in interest expense was primarily the result of less borrowings outstanding during the period. Income tax benefit from continuing operations. We reported income tax benefit of EUR 0.4 million for the six months ended June 30, 2007, compared to EUR 0.4 million for the six months ended June 30, 2006. Income/Loss from continuing operations. We reported a loss from continuing operations of EUR 0.5 million for the six months ended June 30, 2007, compared to EUR 0.2 million in income from continuing operations for the six months ended June 30, 2006. We attribute the decrease in income from continuing operations in 2007 to a decrease in operating profit offset by reduced interest expense. Loss from discontinued operations. Our loss from discontinued operations for the six months ended June 30, 2006 was EUR 0.2 million. Net Income/loss. We reported a loss of EUR 0.5 million for the six months ended June 30, 2007, compared to no net income for the six months ended June 30, 2006. We attribute the decrease in net income in the period to decreased income from continuing operations offset by the absence of loss from discontinued operations we reported in the six month period ended June 30, 2006.
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This excerpt taken from the PRVT 10-Q filed May 10, 2007. Three months ended March 31, 2007 compared to the three months ended March 31, 2006 Net sales. For the three months ended March 31, 2007, we had net sales of EUR 5.4 million compared to net sales of EUR 6.4 million for the three months ended March 31, 2006, a decrease of EUR 1.0 million or 15%. DVD & Magazine sales decreased EUR 1.4 million, or 34%, to EUR 2.7 million. The decrease in DVD & Magazine sales was primarily attributable to the reorganization of our DVD & Magazine distribution, see discussion under Outlook below. Internet sales was EUR 1.1 million, which represents an increase of EUR 0.1 million compared to the same period last year. Broadcasting sales increased EUR 0.2 million to EUR 1.0 million as a result of an increase in video on demand sales offset by a decrease in channel sales in the US. Wireless sales increased EUR 0.2 million to EUR 0.6 million as a result our content being available with more operators.
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Going forward, we expect Internet, wireless and Broadcasting sales, in particular, to increase (see discussion under Outlook below). Cost of Sales. Our cost of sales was EUR 3.2 million for the three months ended March 31, 2007 compared to EUR 3.6 million for the three months ended March 31, 2006, a decrease of EUR 0.4 million, or 11%. Included in cost of sales is printing, processing and duplication, amortization of library and broadcasting costs. Printing, processing and duplication cost was EUR 1.4 million for the three months ended March 31, 2007 compared to EUR 2.0 million for the three months ended March 31, 2006, a decrease of EUR 0.6 million, or 31%. Printing, processing and duplication cost as a percentage of DVD & Magazine sales was 50% for the three months ended March 31, 2007, which represents an increase of 3%. The increase was the result of a decrease in average price on products sold. Amortization of library was EUR 1.7 million for the three months ended March 31, 2007 compared to EUR 1.5 million for the three months ended March 31, 2006, which represents an increase of EUR 0.2 million. Amortization of library does not vary with sales since it reflects the amortization of our investments in content which has been available for sale for a period of three to five years. Broadcasting cost was EUR 0.1 million for the three months ended March 31, 2007 compared to EUR 0.1 million for the three months ended March 31, 2006. Broadcasting cost represents programming cost. Gross Profit. In the three months ended March 31, 2007, we realized a gross profit of EUR 2.2 million, or 41% of net sales compared to EUR 2.8 million, or 44% of net sales for the three months ended March 31, 2006. The decrease in gross profit as a percentage of sales was the result of amortization of library, which does not vary with sales, and decreased margins on DVD & Magazine sales. Selling, general and administrative expenses. Our selling, general and administrative expenses were EUR 3.1 million for the three months ended March 31, 2007 compared to EUR 3.3 million for the three months ended March 31, 2006, a decrease of EUR 0.2 million, or 2%. Operating loss. We reported an operating loss of EUR 0.8 million for the three months ended March 31, 2007 compared to an operating loss of EUR 0.5 million for the three months ended March 31, 2006. The decrease in operating profit of EUR 0.3 million was primarily the result of the decrease in gross profit offset by reduced selling, general and administrative expenses. Interest expense. We reported interest expense of EUR 0.1 million for the three months ended March 31, 2007, compared to EUR 0.2 million for the three months ended March 31, 2006. The decrease in interest expense was primarily the result of less borrowings outstanding during the period. Income tax benefit from continuing operations. We reported income tax benefit of EUR 0.3 million for the three months ended March 31, 2007, compared to EUR 0.2 million for the three months ended March 31, 2006. The increase in income tax benefit is a result of higher losses being recorded in jurisdictions with higher corporate tax rates.
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Loss from continuing operations. We reported a loss from continuing operations of EUR 0.6 million for the three months ended March 31, 2007, compared to EUR 0.4 million for the three months ended March 31, 2006. We attribute the increase in loss from continuing operations in 2007 to an increase in operating loss offset by reduced interest expense and increased tax benefit. Loss from discontinued operations. Our loss from discontinued operations for the three months ended March 31, 2006 was EUR 0.1 million. Net loss. We reported a loss of EUR 0.6 million for the three months ended March 31, 2007, compared to EUR 0.5 million for the three months ended March 31, 2006. We attribute the increase in loss in the period to increased loss from continuing operations offset by the absence of loss from discontinued operations we reported in the three month period ended March 31, 2006. | EXCERPTS ON THIS PAGE:
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