Odimo winds down its e-commerce operations
E-commerce sales for Odimo Inc. dropped 73.9% in the third quarter to $2.4 million from $9.1 million in the third quarter of 2005.
It’s also clear that Odimo, which sold off Diamond.com to Ice.com in May, is winding down it current e-commerce operations, which include WorldofWatches.com and Ashford.com. In October, Odimo signed a non-binding letter of intent to sell its WorldofWatches.com domain name and selected technology and equipment to ILS Holdings LLC for $410,000. In November Odimo also terminated the lease on its corporate headquarters in Sunrise, FL, for a one-time payment of $500,000 and the release of the security deposit of approximately $80,000.
“Upon cessation of our current online retail operations, we will become a public shell company with limited, if any operations,” Odimo says in its recently filed quarterly earnings report.
In Q3 Odimo reported a net loss of $2.9 million vs. a net loss of $3.5 million in Q3 2005. “Following the sale of our online jewelry and diamond retail business in May 2006 and in order to more efficiently operate our remaining online watch and luxury items retail business, we implemented a cost reduction program including reducing staff, discontinuing active sales of certain product lines and deferring selected marketing expenses,” the company says. “Despite the reduction in expenses, our revenues have not been sufficient to satisfy our operating expenses and our cash reserves have been depleted to fund ongoing operating losses.”
For January through September, Odimo reported a decrease in revenue of 48.6% to $17.1 million from $33.4 million for the nine months ended September 30, 2005. The company’s net loss for the first nine months of 2006 was $3 million vs. a net loss of $9.5 million for the same period in 2005. “We anticipate by Dec. 31, 2006, we will have sold substantially all of our remaining inventory, will have discharged all of our remaining liabilities and will have ceased our operations and will no longer be an online retailer of watches and luxury items,” the company says.
Odimo, No. 151 in the Internet Retailer Top 500 Guide to Retail Web Sites, sold Diamond.com to Ice.com for $9.5 million. Ice.com paid $7.5 million for the domain name, copyright and other intangibles and $2 million for inventory and packaging.
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