Rediff cuts losses by 94% in December quarter

Rediff.com, the internet portal, has drastically cut down its net loss by 94 per cent in the quarter ended December 31, 2003, to $0.16 million as against $2.61 million in the corresponding period in the previous fiscal. Total revenues for the quarter was at $3.6 million ($3.3 million).

India Online's revenues were at $0.98 million ($0.64 million), US Publishing at $1.53 million ($1.45 million) and Valucom at $1.10 million ($1.24 million). US Publishing comprised of India Abroad, a weekly news publication and Rediff USA online.

The lower revenues in phone card business were primarily due to reduced rates per minute from US to India calls according to a company release.

Gross margin for the quarter was at $1.58 million or 44 per cent compared with $0.93 million or 28 per cent in the previous year.

The operating expenses were lower by 52 per cent to $1.52 million compared to $3.15 million for the corresponding quarter last year. The registered users grew by 26 per cent to 29 million.

"We are pleased to announce that Rediff.com is reporting for the first time a positive operating EBITDA in the third quarter driven by growth in Indian online revenues, increase in company-wide gross margins and lower operating expenses," said Ajit Balakrishnan, chairman and CEO, Rediff.com India.

The operating earning before interest, depreciation and tax (EBITDA) for the quarter was at $55,000 compared with a loss of $2.2 million for the corresponding quarter of 2002.

According to a release, the factors which contributed to improved profitability were better gross margins and reduction in operating expenses.

The reduction in total operating expenses were due to reduction in advertising and sales promotion of $0.6 million and other expenses amounting to $0.5 million and write-back of liabilities no longer required amounting to $0.4 million.