Free WiFi Hotspot Locator from TechNewsWorldAnswerthink, Inc. (Nasdaq: ANSR) was down 11/32 at 3 21/32 early Wednesday after the Internet consulting company said it will take a charge to fourth-quarter earnings as it reduces its dependence on dot-com clients.
The Miami, Florida-based company said it expects pro forma net income for the quarter to be between breakeven and US$1 million, on revenue of $68 million to $70 million.
The results will be below previous expectations because of planned job cuts, allowances for bad debt and the deferral of other projects, Answerthink said. The firm will also take an after-tax charge of about $7.5 million, resulting in a net loss of $7.5 million to $8.5 million.
For the year, the company said, it expects pro forma earnings to total $22 million to $23 million, or 49 to 53 cents per share, on revenue of $320 million to $325 million.
"While dot-coms have historically represented less than 15 percent of our business, the diminished demand for these type of projects impacted our fourth-quarter results," said chairman and chief executive officer Ted A. Fernandez.
"We felt that it was important to quickly deal with our exposure related to these dot-com projects, and more importantly, focus our organization on our significant Global 2000 relationship base, where we expect strong 2001 demand," Fernandez said.
"We know that some of our current dot-com clients have great prospects for
success," Fernandez said. "Therefore, we plan to maintain a limited number
of very strategic relationships. However, we wanted to take the steps now to
help ensure that our 2001 operating results would not be dependent on these
types of initiatives."
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