(RTTNews) - Tuesday, Rediff.com India Ltd. (REDF: News ), an online news and information provider, reported a loss for the fourth quarter compared to a profit last year, hurt by charges, declining online advertising revenues and depreciation of the Indian Rupee against the U.S. dollar. In the morning hours of trading shares were down more than 12% on the Nasdaq.

The Mumbai, India-based company reported a net loss of US$8.86 million or US$0.303 per ADS for the fourth quarter, compared to net profit of US$0.90 million or US$0.03 per ADS in the same period last year.

Results for the quarter included a non-cash goodwill and intangible asset impairment charge of $6.9 million, relating to acquisition of the print newspaper 'India Abroad' in the United States in 2001.

Total revenues for the quarter declined to US$4.50 million from US$9.10 million in the same quarter of the previous year.

India online revenues for the quarter decreased to US$3.43 million from US$7.20 million last year, while US publishing revenues dropped to US$1.10 million from US$1.90 million in the year-ago quarter.

Gross margin for the quarter dropped significantly to 70% from 83% in the prior-year quarter.
Ajit Balakrishnan, chairman and CEO, Rediff.com said, "The continuing economic slowdown in the travel, jobs, matrimonial, shopping, consumer finance and real estate sectors in India continued to affect online advertising revenues, in particular revenues from other online companies in these industries."

For the full-year, the company reported a net loss of US$11.30 million or US$0.385 per ADS, compared to a net income of US$4.92 million or US$0.166 per ADS last year.

Total revenues for the period decreased to US$25.43 million from US$32.25 million in the previous year.

The company indicated that it expects an increase in operating expenses from current levels by an average of about US$1.0 million to US$1.5 million per quarter over the next three to four quarters and anticipates some revenue loss in the short run from eliminating ads on its international website's home page.

REDF is currently trading at $3.62, down $0.53 or 12.77% on the Nasdaq.

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by RTT Staff Writer

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