HouseValues Inc., a company that provides online tools for real estate professionals and real estate search sites for consumers, on Thursday reported a $9.9 million net loss in the fourth quarter compared with a $710,000 net loss in the previous year’s quarter.
For the full year in 2007 the company reported a $12.6 million net loss, compared with net income of $3.3 million in 2006.
The past year has been rough for HouseValues (Nasdaq: SOLD). The company’s stock price hit an all-time low of $2.66 per share on Dec. 12, and last month company officials announced the layoff of 45 employees and the resignation of R. Barry Allen, the company’s chief financial officer. The company expects to realize about $5 million in annualized savings through this restructuring, according to its earnings report.
In late 2007, the company announced that it was closing a sales and service center in Yakima, Wash., and laid off 100 workers — about 30 percent of its workforce, to cut operating expenses. And also in 2007 the company announced that it was stepping out of the mortgage lead-generation business to focus on its core services for real estate agents and brokers.
But while the company has been cutting jobs, it has also invested in new ventures. HouseValues bought Realty Generator LLC, a lead-generation services company, and related company Blackwater Realty LLC, in November 2007. And the company last month announced a $2.75 million investment in real estate social networking site ActiveRain.
HouseValues paid $10 million in cash and assumed liabilities in the Realty Generator deal, according to documents filed with the U.S. Securities and Exchange Commission, and also is required to pay Realty Generator based on the future performance of the acquired business through June 30, 2009.
HouseValues’ stock price was trading at $2.86 a share at the close of the market Thursday, down 5 cents compared to the previous day’s closing price.
Ian Morris, HouseValues CEO, said in a statement that market conditions “were more challenging than many anticipated,” adding that the company has been “aggressively managing its cost structure” and “has focused on profitably driving the success of existing customers while at the same time making strategic investments that the company expects will lead to future growth.”
Fourth-quarter revenue totaled $12.2 million, compared with $19.1 million for the same quarter in 2006. The company had revenues of $59.8 million for the full year in 2007, down from $85.8 million in 2006.
HouseValues’ decline in revenue from third-quarter 2007 to fourth-quarter 2007 “reflected fewer customers and lower average monthly revenue per user in the company’s agent-direct business,” the company reported, though this was offset slightly by Realty Generator revenue.