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Homestore Narrows Its Loss by 23%

November 12, 2003|Roger Vincent | Times Staff Writer

Homestore Inc. said Tuesday that its third-quarter loss narrowed by 23% as the once-highflying Internet real estate company continued its struggle to reorganize.

The Westlake Village-based company, which operates leading Internet real estate site Realtor.com, "resolved substantially" long-standing financial and legal challenges and increased its focus on operations, said Chief Executive Michael Long.

Homestore said in August that it would pay $13 million in cash and hand over 20 million shares to settle a stockholders' lawsuit over a scam that puffed up the company's revenue in 2000 and 2001 as the dot-com balloon began to deflate.

Seven former mid-level managers and business partners last month settled federal charges of helping the company inflate revenue.

The seven agreed to cooperate with prosecutors, who expect to produce more indictments against defendants who have not entered plea bargains. Previously, four Homestore financial officers pleaded guilty to fraud. They are cooperating with the investigation.

Homestore shares once traded above $100; they closed Tuesday at $2.99, down 2 cents, on Nasdaq. The earnings were released after the markets closed.

In the third quarter, Homestore lost $30.6 million, or 26 cents a share, compared with a deficit of $39.8 million, or 34 cents, a year earlier.

Revenue fell 15.7% to $63.8 million.

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