NEW YORK (Thomson Financial) - Shares of RedEnvelope Inc. plummeted Thursday
after the company swung to a loss in the third quarter and said its ability to
continue as a going concern past the quarter ending in June depends on its
ability to achieve profit.
The stock fell 43% to a 52-week low of $1.96, trading at more than three
times its 30-day average volume.
Late Wednesday, the company reported it swung to a third-quarter loss of
$4.3 million, or 45 cents a share, from a profit of $5.3 million, or 56 cents a
share, a year earlier.
Revenue fell to $45.2 million from $57 million a year earlier.
"The company believes the cash on hand and available under its lending
arrangements will be sufficient to fund operations and anticipated capital
expenditures through the quarter ending June 2008," RedEnvelope said. "However,
the continuation of the company as a going concern beyond the quarter ending
June 2008 is dependent upon the company's ability to fund operations and
anticipated capital expenditures and achieve profitable operations in the
future."
Christie Rizk
cr/jw
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