CMGI Beats Estimates, Revenues Soar; AltaVista to IPO

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http://biz.yahoo.com/rf/000921/n21563901_2.html

> Thursday September 21, 9:12 pm Eastern Time
> CMGI Q4 share loss beats estimates, revs soar
> (UPDATE: Adds CMGI consolidations, graf 3, )
>
> By Tim McLaughlin
>
> BOSTON, Sept 21 (Reuters) - Executives at CMGI Inc.
> (NasdaqNM:CMGI - news), whose investments and operations span 70
> Internet companies, said on Thursday it would continue to
> consolidate operations after reporting that fourth-quarter
> revenue soared 568 percent to $377.2 million amid heavy losses.
>
> CMGI posted a net loss of $633.7 million for the quarter ended
> July 31 as it moves to reorganize a venture fund and 17
> majority-owned companies into six business segments.
>
> ``I think you'll see further consolidations,'' CMGI Chairman
> David Wetherell told analysts on a conference call.  ``We're
> working very aggressively toward a plan to provide greater focus
> in each segment.''
>
> CMGI has moved to simplify its cluster of operating companies to
> make their financial performance less confusing to investors.
> Shares of CMGI have plummeted nearly 78 percent since January as
> many of its Internet investments have fallen out of favour with
> Wall Street.
>
> CMGI's operations, which include majority-owned Internet
> companies such as AltaVista, Engage Technologies Inc and NaviSite
> Inc , racked up an operating loss of $2.19 billion on revenue of
> $898.1 million during the fiscal year that ended July 31.
> Wetherell said he expects profitability in five of the six
> segments by the close of fiscal 2001.
>
> Meanwhile, the company has plenty of capital to fund its future
> operations. The current market value of CMGI's publicly traded
> securities approaches $5 billion, CMGI Chief Financial Officer
> Andrew Hajducky said.
>
> CMGI's fourth-quarter basic share loss of 49 cents beat analysts'
> consensus estimates of a loss of $2.45 a share, according to a
> survey by First Call/Thomson Financial.
>
> Including special charges, Andover, Mass.-based CMGI said it lost
> $2.17 a share in the fourth quarter, compared with earnings of
> $452.7 million, or $2.37 a share, in the year ago quarter. Last
> year's fourth-quarter results included a pretax gain of $661.2
> million from its sale of GeoCities Inc. to Yahoo Inc .
>
> Before the earnings release, CMGI's stock price closed down 1/16
> to $36-3/8 during Thursday trading on the Nasdaq.
>
> Besides pulling the plug on a $1.5 billion Web venture fund, CMGI
> recently had Internet marketer Engage Technologies cut about 13
> percent of its workforce and consolidate its business to
> accelerate profitability. The move followed an announcement by
> Web site and search engine AltaVista Co. that it would cut 25
> percent of its staff and focus on its search business.
>
> ``This report is a starting line of a race,'' said Steve Frankel,
> an analyst at Adams, Harkness & Hill, before the earnings
> release. ``This is the first time the company presents a detailed
> look of the operating segments. Now the (profit and loss
> statement) will mean something.''

also:

http://dailynews.yahoo.com/h/nm/20000921/bs/tech_altavista_dc_1.html

| Thursday September 21 8:04 PM ET
| CMGI to Take AltaVista Public

Looks like they're going to try again... better hurry before
everyone else realizes how good Google is.

| BOSTON (Reuters) - CMGI Inc. (NasdaqNM:CMGI - news), whose
| investments and operations span 70 Internet companies, told
| analysts on Thursday it plans to take the AltaVista search engine
| public by the end of the first quarter 2001.
|
| CMGI Inc. Chairman David Wetherell called the first quarter of
| 2001 ``optimal timing'' to take Palo Alto, Calif.-based AltaVista
| public as the Web site concentrates on being a search engine for
| consumers and large corporations.
|
| ``We got a world beating technology there,'' Wetherell told
| analysts during a conference call.
|
| AltaVista, which was developed by the now-defunct Digital
| Equipment Corp., on Wednesday started AltaVista Denmark, an
| Internet search service as part of its plans to establish 35
| country-specific search sites in the next 10 months.
|
| AltaVista, which is about 82-percent owned by CMGI, said last
| Friday that it reduced its work force by 25 percent as part of a
| restructuring aimed at attaining profitability.
|
| CMGI Chief Financial Officer Andrew Hajducky said CMGI took a $15
| million charge in the fiscal fourth quarter ending July 31 from
| the workforce reduction. The company could also take another
| charge from the cutback during the first fiscal quarter ending
| Oct 31, he said.
|
| Wetherell said the job reductions, along with ramped up growth,
| should make AltaVista's North American operations profitable by
| the end of the fiscal second quarter ending Jan 31.
|
| AltaVista, which CMGI acquired for about $2.4 billion from Compaq
| Computer Corp (NYSE:CPQ - news), plays a major role in CMGI's
| newly created search and portals segment. When including charges,
| that segment posted an operating loss of $307 million on revenue
| of about $98 million in the fourth quarter, CMGI said.

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Gerald Oskoboiny <[email protected]>
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