Getty generated total revenue of $218MM in 4Q07 as compared to $204MM in 4Q06. Net profit suffered, however, as gross and operating margins declined causing net profit to drop from $31MM in 4Q06 to $29MM in 4Q07.  The 4Q07 figures represent a significant improvement, however, over 3Q07, in which the gross revenue totaled $209MM and net profit, $26MM.

Klein attributed the company’s improving performance in the recent quarter over the immediately preceding one to a number of initiatives including the $49 web-use product launched in September, the refinement of the new gettyimages.com web-site launched over the summer, and reorganizing sales and marketing efforts along customer segment lines.

Klein took pains to dispel the notion that Getty has experienced downward price pressure.  He argues that the high-end creative still uses still get the same if not higher license fees.  However, the mix of sales has changed such that the company makes fewer such high-end sales.  As marketers spend more of their budgets on on-line media and paid search (which uses no images at all) and as the print advertising business continues to decline, the mix leans more toward lower-priced editorial and on-line usages.

As expected, during the Q&A period, the first analyst asked about the possible sale of the company to a private equity firm.  The questioner wondered, why now, when the company seems to have stabilized growth, but is trading at a relatively low share price (about $25 vs. $50 a year ago.) Also as expected, Klein said he could not comment in any detail other and made a general statement about getting the best value for Getty’s shareholders.  How one can reconcile selling the company at half its value of a year ago with getting the best value for its shareholders remains to be seen.