Lastminute losses narrow

Lastminute.com's founders Brent Hoberman and Martha Lane Fox

Online travel site Lastminute.com saw its losses narrow in the third quarter of the year.

It reported pre-tax losses of £9.27m, compared with £11m in the previous quarter.

At the end of the quarter, the number of registered users it had across Europe exceeded two million.

About 30% of these were outside the UK.

On a positive note, the company made a gross profit of £950,000 pounds in the quarter, up from £707,000 in the second quarter, it added.

Lastminute's chief executive, Brent Hoberman said the financial results and subscriber figures were ahead of target.

"Operating costs are being stringently controlled, increasing substantially less rapidly than gross profit," he said.

In recent months, the company has seen its share price fall, as it has been hit by investors' growing lack of confidence in the ability of many dot.com companies to turn a profit.

High investment costs

Co-founder Martha Lane Fox told the BBC on Thursday that the high cost of investment was behind the losses.

"It is obviously investing for the future in new markets and new platforms. We are determined to keep costs in line ... all internet companies are focused on the path to profitability," she said.

"There is no problem with the technology. We just want to upgrade it to make sure we can really grow in the future," she added.

The company is aiming to switch its dependency on the travel industry to other others such as entertainment. It said 47% of sales in the third quarter were non-travel items, up from 45% in the second quarter.

Lastminute hopes to double its entertainment offers through a deal with live entertainment producer SFX. Altogether, Lastminute.com has supply agreement almost 3,500 companies offering a range of leisure services.

Analysts estimate that Lastminute.com will reach profitability in 2003 and Ms Lane Fox played down concerns about Lastminute's falling share price.

"We raised a huge amount of money at flotation ...we don't need to go back to the market right now. While the share price is obviously important, it is not something we need to worry about (right now)," she added.

It held its initial public offering in March and saw its shares soar on the day of its flotation, just before market sentiment toward technology stocks changed.

Lastminute's shares closed down 3.5p at 151p, well below their March issue price of 380p.