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Expansion widens Terra loss
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February 28, 2000: 8:17 a.m. ET
Spanish Web access co. sees bigger 1999 deficit; sales, user numbers soar
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LONDON (CNNfn) - Spanish Internet access provider Terra Networks posted a sharply increased 1999 loss Monday, but reported a jump in revenues to support its position as Europe's largest listed Internet play by market value.
Terra's value has soared to 27 billion euros ($26.5 billion) since Spanish telecom market leader Telefónica spun off a 24.9 percent stake last November. The company has since embarked on a spending spree in its home market, in Portugal and Latin America to expand content and improve distribution.
The higher spending led Terra to announce a pro forma net loss of 173.7 million euros last year, compared with a 117.1 million-euro deficit in 1998.
However, revenue climbed 50 percent to 78.5 million euros last year, with subscription sales rising 70 percent to 48.4 million euros, some 60 percent of the total. Advertising revenue doubled to 7 million euros.
Although the net loss was in line with the consensus forecast among analysts polled by Reuters, the stock fell 5.6 percent to 134.20 euros in Madrid, well below its peak this year of 157.65 euros. The shares, which are also listed on the U.S. Nasdaq stock market, were sold at 13 euros each in last year's initial offering.
Terra said the number of its subscription clients in Spain more than tripled in 1999 to 158,000. Its free-access service has attracted 500,000 customers since its launch last year. In Brazil, its second-largest market, subscriber numbers rose 142 percent to 346,000, while subscriptions tripled in Chile, its third-largest market, to 118,000.
Terra, which started operating in November 1998, said it does not expect to make a profit until 2002. 
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