CHICAGO – IAC/InterActiveCorp (IACI), owner of Internet travel site Expedia and the Home Shopping Network (search), Wednesday posted a quarterly loss as it took charges to write down the value of two businesses.
IAC, whose shares fell as much as 3 percent, said operating income before amortization was up strongly at Home Shopping Network but rose only slightly in its travel business.
"(The) travel sector was weaker than we anticipated, offset by a somewhat stronger-than-expected (Home Shopping Network), especially in Europe," Safa Rashtchy, a Piper Jaffray analyst, wrote in a research note. "We are likely to lower our estimates to adjust for even lower travel growth."
IAC, which plans to split in two by spining off Expedia (search) and related businesses in the second quarter, posted a fourth-quarter net loss of $45.9 million, or 7 cents a share, compared with a net profit of $152.8 million, or 20 cents a share, a year earlier.
Excluding $218 million in charges related to write-downs of the Precision Response (search) teleservices business and TV Travel Shop (search) as well as other items, IAC posted earnings of 33 cents a share, up from 29 cents a year earlier. Analysts, on average, expected 27 cents a share, according to Reuters Estimates.
In addition to its portfolio of Web travel sites, IAC holds retail units such as Home Shopping Network and HSN.com and Ticketmaster.com.
IAC Chief Executive Barry Diller (search), in a statement, called the results satisfactory but added, "Beyond that, and far more importantly, we put down many tracks, many initiatives, many tuck-in acquisitions that should lead to growth for years to come."
Fourth-quarter revenue fell to $1.72 billion from $1.80 billion a year earlier. The 2003 figure would have been $1.57 billion if the company had booked Hotels.com revenue the way it now does.
Operating income before amortization rose to $323.9 million from $291.5 million a year earlier.
At IAC Travel, operating income before amortization grew just 3 percent to $154.2 million. Travel revenue rose, helped by international packages and the acquisition of Hotwire.com in late 2003.
The company said HSN U.S. operating income before amortization grew 20 percent to $68.4 million. HSN International operating income before amortization more than doubled, to $20.1 million.
IAC's ticketing business grew operating income before amortization by 11 percent to $38.3 million. The company said that as it develops enhanced products to sell tickets, its technology expenses will increase. But ticket royalties also are expected to rise.
IAC shares were down 40 cents at $23.60 on the Nasdaq stock market after falling as low as $22.74 earlier.