Register.com swings to loss

July 31st, 2003
By Dow Jones/AP

Internet domain registrar Register.com Inc. Thursday said it swung to a second-quarter loss as two hostile takeover attempts earlier this year raised costs.

The loss for the latest quarter was $3 million, or 7 cents a share, compared with earnings of $847,000, or 2 cents a share, in the prior second quarter.

Analysts surveyed by Thomson First Call had forecast second-quarter earnings of about 2 cents a share for the New York-based company.

Revenue slipped 3 percent in the latest quarter to $26.2 million from $27 million.

Operating expenses rose 36 percent to $22.3 million from $16.4 million.

Register.com spent $5.4 million to evaluate unsolicited takeover offers from Zackfoot Investments LLC's IWB Acquisitions LLC unit and RCM Acquisition Co. earlier this year. It rejected the RCM offer and didn't respond to the IWB offer.

The rejection of the RCM bid prompted a dissident shareholder group led by RCM affiliate Barington Cos. Equity Partners LP to threaten a proxy fight.

In exchange for a pledge by Barington to call off the proxy contest, Register.com agreed to buy back $120 million in stock and to unveil a business plan at its annual meeting on Thursday.

Register.com Thursday said it would start buying back stock by Aug. 4 at $6.35 a share.

Shares of Register.com were at $6.07 Thursday afternoon, down 4 cents on the Nasdaq Stock Market.