Rediff revenue slides 18% to $3.97M in Q3, e-com revenue up 85% Y-o-Y; Net loss jumps

NASDAQ-listed Rediff.com has seen its revenue drop 18 per cent to $3.97 million for the third quarter ended December 31, 2012, over the year-ago period (but it rose 3.4 per cent sequentially), led by 17.7 per cent fall in India online revenues to $3.2 million. US publishing revenues were also down 16.3 per cent to $0.77 million.

Net loss in the period jumped to $3 million from $1.2 million during the same period last year, including a non-cash goodwill impairment charge of $2 million from its acquisition of the print newspaper India Abroad in the US in 2001. This was partly offset by a one-time gain of $1.4 million from the sale of an investment.

The company's core online advertising business in India grew approximately 7 per cent (in dollar terms) on a sequential basis.

Revenue from Rediff.com's online shopping marketplace business grew 11 per cent on a quarterly sequential basis and was up 85 per cent year on year while maintaining a margin of 12 per cent. During the quarter, the range of products listed on Rediff.com marketplace grew 7 per cent to 184,000 SKUs.

The company's internet-based local TV advertising business added three new TV channels to its distribution network in the third quarter and now can reach up to 80 million individuals while enabling local merchants in 10 Indian cities, namely, Delhi, Mumbai, Pune, Ahmedabad, Baroda, Surat, Mysore, Bangalore, Indore and Jaipur, to advertise on seven TV channels. Local TV advertising was launched over the past year and has helped it offset some of the weakness seen in the overall advertising market.

"We believe that our recent growth is the result of the changes we implemented two quarters ago when we revamped our sales strategy for our online advertising businesses and focused investments on growth-driven programmes, specifically related to our online shopping marketplace and internet-based local TV advertising business," said Ajit Balakrishnan, chairman and CEO of Rediff.com.

The company reported an operating EBITDA loss of $2 million for the 2012 fiscal third quarter, compared to an operating EBITDA loss of $1.73 million in the comparable year-ago period.

(Edited by Sanghamitra Mandal)