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Outpost.com lays off 30% of staff
Layoffs at Outpost.com come after continuing losses and turmoil at the top of the executive ranks.
Outpost.com, an Internet retailer of consumer technology products, has laid off 30% of its workforce-110 employees. The action came only a day after Outpost.com reported continuing losses and difficulty securing additional funding. It said it will meet with creditors to discuss payment options. "We are refocusing Outpost.com to concentrate on our industry-leading business-to-consumer electronics business. As far as our customers are concerned, it is business as usual," said CEO and President Darryl Peck.
Outpost also appointed Peck, founder and chairman, as its CEO and president, replacing Katherine Vick, who notified Outpost last week that she believed she had been constructively terminated from her position as Outpost`s CEO and president. Vick, along with a second board member, James E. Preston, have resigned from the Board of Directors.
Outpost reported last week that net sales for the fiscal quarter ended February 28, 2001 were $120.9 million, up 58% compared to the $76.5 million in Q4 2000. The company reported a net loss of $10.2 million for the quarter vs. $9.8 million the previous year. Gross margin for the quarter was 15% vs. 12.4% during Q4 2000.
For the fiscal year ended February 28, 2001, net sales were $355.2 million, 86.6% more than the $190.3 million of net sales for the prior fiscal year. Net loss for fiscal year 2001 was $30.3 million vs. $35.6 million a year ago.
During the fourth quarter, Outpost added approximately 293,000 customers bringing its total customer base to an estimated 1.3 million. Repeat buying rate remained strong with 57% of quarterly product sales coming from repeat buyers. "Given the current economic environment, we were pleased to have met our lowered estimates for the quarter," Peck said. "Current market conditions have made it difficult to secure the required equity and working capital financing we need. Therefore, we intend to meet with our creditors to discuss payment options. As a result, the company has decided to explore all available options at this time."