Luminant Worldwide Corp., Dallas, late Sept. 21 warned it will report a third-quarter loss and said revenue will fall "less than 5%" from the $40.2 million the i-services venture reported in the second quarter. Luminant made its earnings announcement after the market closed; the stock at mid-day Sept. 22 had plummuted to an all-time low of $3.75 a share, far off its Sept. 16, 1999, IPO price of $18. Luminant cited declines in dot-com revenue; an increase in reserves to cover potential uncollectible dot-com-related debts; deferrals of some clients' projects till the fourth quarter; and longer decision-making cycles for some large clients. Luminant said it is optimistic it will see revenue growth in the fourth quarter over the third quarter, and that it will be profitable no later than the first quarter of 2001. Luminant is the latest i-services business to report sluggish results as dot-coms and traditional companies pull back from frenzied Internet spending. "The market shifts impacting our industry have adversely impacted Luminant this quarter as well,'' CEO Gil Marmol said in a statement. "Dot-coms have never been a mainstay in our operations, but the sudden and severe collapse of this sector has magnified the impact of the event. We are taking a series of actions this quarter to ensure this sector will be basically inconsequential to our business going forward.'' As reported, Luminant is putting more emphasis on working with larger clients, such as consumer-goods marketers (adage.com, Sept. 11). In its earnings announcement, Luminant said it borrowed $17 million from investors to provide additional working capital.
Copyright September 2000, Crain Communications Inc.