FASHIONMALL LOPS LOSSES
Byline: Jennifer Weitzman
NEW YORK — Fashionmall.com has something to celebrate this month besides its sixth birthday: The Internet portal said Thursday it narrowed its second-quarter loss, nearly to the break-even point.
For the quarter ended June 30, Fashionmall pared its loss to $23,000, or zero cents a share, from a year-ago loss of $460,000, or 22 cents. Not surprisingly, the portal’s operating losses also dwindled, totaling $429,000, compared with a loss of $1.1 million in the prior-year period.
Net revenue declined 30 percent, to $868,000 from $1.2 million, reflecting the persistently difficult Internet advertising climate. Barter revenue, in contrast, grew both in total dollars and as a percentage of revenue, amounting to $309,000 and 36 percent, against $120,000 or 10 percent of revenue, during the second quarter of 2000.
Fashionmall has been able to continue expanding by virtue of a respectable war chest — now containing roughly $35 million in cash — which it has used to pick up some of the cyber-debris floating online since the bottom fell out of the tech-heavy Nasdaq in March 2000. In a year more known for busts, Fashionmall, based here, has used that position to strategically capitalize on the dot-com fizzle. The portal acquired assets of Boo.com in June 2000 and of BeautyJungle.com, petite apparel site Itsybits.com, and teen destination MXGonline.com this March. Fashionmall Inc. — which also operates Outletmall.com, StyleExpress.com and FashionStyleShopper.com — currently has 18 employees.
Ben Narasin, Fashionmall’s chief executive officer, said Thursday the firm has no plans to raise money at this time and noted it is currently buying back some of its own shares. Earlier this month, Fashionmall said it would buy back up to 1.2 million shares of its stock at $2.50 per share. On Thursday, investors sent up the dot-com’s stock by 5 cents a share to close at $2.50 in Nasdaq trading. During the past 52 weeks, the issue has ranged as low as $1.25 and as high as $5.00.
Narasin said he is “very happy with the reception and client sign-ups for our newly launched BeautyJungle.com site,” adding: “It fills an appropriate niche for us.” The beauty portal, in fact, represents an opportunity to shift customers who once shopped a range of beauty e-tailers to a central location, at beautyjungle.com.
The next phase for Fashionmall is to consolidate these recently acquired operations and implement some cost cutting measures, Narasin pointed out.
For the six months, Fashionmall trimmed its loss to $590,000, or 8 cents a share, compared with a loss of $3.3 million, or 75 cents, in the first half of 2000. The dot-com’s operating loss also contracted to $1.6 million from a year-earlier loss of $4.4 million. First-half sales fell 15 percent to $2.2 million from $2.6 million a year ago.