Global Internet company
widened its quarterly loss and missed its revenue estimates, slammed by slumping global advertising and foreign-currency fluctuations.
The company reported a net loss of 98.7 million euros ($99.6 million), compared with a loss of 82 million euros in the year-earlier period. Sales dropped 14% to 145.8 million euros from 170.1 million euros in the same period a year ago.
Terra Lycos said its results took a hit from foreign-currency fluctuations. The company said it would have reported revenue of 169 million euros, in line with its estimates of 165 million to 175 million euros, if it hadn't been for the fluctuations.
The Spain-based company operates portals and Internet-subscription services in 42 countries, including the U.S.
"There is little evidence of an upturn in the U.S. advertising market which Terra relies upon for most of its revenues, and where its portal Lycos Inc. is losing market share," said BNP Paribas analyst Alexandra Lord in a morning research note. "Overall we see little that will lead to revenue improvements in the short to medium term."
On a nine-month basis, Terra Lycos managed to pare down its net loss by 30% to 332.2 million euros, from a 473.3 million euro loss in first nine months of last year, based on steep cost-cutting efforts, which saved the company 24 million euros in operating expenses.
Losses before interest, tax, depreciation and amortization improved to a loss of 26.5 million euros, from a loss of 48.8 million euros last year. EBITDA margins improved to -18%, from -29%.
"Our primary objective remains to continue to grow profitably, and these results reflect the fact that we are maintaining the positive growth of recent quarters, through efficient resource management and ongoing process improvement," said Terra Lycos Executive Chairman Joaquim Agut in a prepared statement. "Without a doubt, the unfavorable advertising market environment is continuing to affect us," he added.