Loss Grows For Geerlings & Wade

Geerlings & Wade Inc. reported net income of $1,000 for the third quarter, up from a net loss of $293,000 last year. But for the nine months ended Sept. 30, the direct mail and Internet retailer of wine and wine-related products reported a $3 million loss compared to $595,000 one year ago.

The firm reported sales of $6 million for third quarter, off 13% from $6.9 million last year. Revenue for the nine months was $19.6 million versus $21.9 million.

The Canton, MA firm attributed its sales to weak demand in the early months of the third quarter and the effects of a reduction in the number of customers acquired in the last 18 months. The firm has cut significantly its prospect mailings over the last several years and in August replaced its CEO David R. Peace after he was forced out, with one of the founders Huib E. Geerlings.

The wine seller also said it has been working on improving its efficiencies and reduced its marketing expenses by 19% during the third quarter compared to the same time last year.

In September, Geerlings & Wade received notification from Nasdaq that its stock may be delisted for noncompliance with a marketplace rule. The company’s common stock had closed below the minimum $1 per share requirement for continued listing on the NASDAQ SmallCap. Its stock price was trading at 80 cents yesterday afternoon. The company has until Feb. 26 to regain compliance.

For the year ended Dec. 31, Geerlings & Wade posted a 12.1% decline in sales to $32.7 million. Poor response and a 22% cut in prospect mailings also contributed to a before-tax loss of $1 million for the year, compared to a $471,000 loss in 2000, the company said at the time.