ZipRealty Inc. today announced a net loss of $200,000, or 1 cent per share, for the second quarter. That compares to a loss of $946,000, or 5 cents per share, in second-quarter 2005 and a loss of $800,000 in first-quarter 2006.

The company had net revenues of $26.9 million in the second quarter, a 4.5 percent gain from second-quarter 2005 and up 40.1 percent from $19.2 million in the first quarter.

The company expects third-quarter revenues to range between $24 million and $26 million, according to the earnings announcement. At this revenue level, reported net loss per share is expected to be between $0.00 and $0.05, with a corresponding pro forma earnings per share range that is roughly flat.

For the full year ended Dec. 31, 2006, management expects revenues to range between $90 million and $95 million. That is down from a full-year projection of $105 million to $115 million that the company offered during its first-quarter earnings announcement.

ZipRealty’s stock closed at $5.99 per share Tuesday, down 29 cents from the previous day’s close.

ZipRealty officials expect reported net loss per share for fiscal 2006 to range from 25 cents to 30 cents, with a corresponding pro forma loss per share range of 15 cents to 20 cents.

As of June 30, ZipAgent employed 1,669 agents, up from 1,481 at the end of first quarter of the year and up from 1,235 at the end of second-quarter 2005.

The company’s total value of real estate transactions closed increased about 2 percent to $1.26 billion in the second quarter from $1.24 billion in the second quarter of 2005, while the number of transactions closed increased 5.2 percent to 3,552 in the second quarter from 3,375 during the same quarter last year.

Average net revenue per transaction increased 4.3 percent to $7,375 in the second quarter from $7,069 in the first quarter, “due primarily to an increase in the average home price of the company’s transactions,” according to the earnings announcement.

Gary Beasley, president and CFO of ZipRealty, said in a statement, that the results “were better than expected from both a top and bottom line perspective. The results were aided by solid performance in new markets, as well as higher-than-anticipated average transaction revenues and closing yields.”

He added, “Despite the fact that we experienced an overall increase in year-over-year transaction volumes, transaction growth in those markets opened before 2005 experienced a slight decline due to persisting challenges in the real estate market.

“Irrespective of these conditions, we are continuing with expansion plans and investment. Specifically, our new market strategy is on track and we’re optimistic that new cities, launching later in the year, will follow recent successes of Las Vegas, Houston and Miami. In terms of investment, we’re embarking on several initiatives designed to improve Web functionality, agent productivity, and the overall customer and agent experience.”

As of June 30, 2006, the company had approximately $86.4 million of cash, cash equivalents and short-term investments with no long-term debt.

The company currently estimates an effective 2006 income tax rate of approximately 20 percent will be recorded for book purposes. Despite the book tax rate, however, ZipRealty does not expect to pay material cash taxes until it exhausts its $45 million of federal and $29 million of state net operating loss carry-forwards, according to the announcement.

A replay of the earnings conference call is available through Aug. 15 by calling (888) 203-1112, and entering password 7503140.

Founded in 1999, ZipRealty is a full-service residential real estate brokerage firm that operates in 19 major metro area in 12 states and in Washington, D.C.

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