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To: Danny who wrote (106117)	7/14/2000 11:50:16 AM
From: H James Morris	Read Replies (2) \| Respond to of 164684

Danny, speaking of WebVan Oh! Full disclosure I'm long wbvn will an average cost of about 6 1/4, and Shaheen is pleased???????????? If I blew off $57 mil I'd be depressed! What the hell am I missing???? > PALO ALTO, Calif., July 13 (Reuters) - Online grocer Webvan Group Inc. <WBVN.O> Thursday reported a second quarter loss that was larger than a year earlier and also slightly larger than most forecasts. The company, which recently agreed to acquire rival HomeGrocer Inc.<HOMG.O>, reported a pro forma net loss of $57.1 million or 17 cents per share, compared with a loss of $38.7 million or 12 cents per share a year earlier. Most analysts had been forecasting a loss of 16 cents per share. Webvan said revenues grew to $28.3 million from $16.3 million last year, its customer count grew rapidly as it expanded in new markets in Atlanta and Sacramento. "I am very pleased with Webvan's performance in the second quarter," Webvan Chief Executive George Shaheen said in a statment. "Our launch in the greater Atlanta area has been very successful, demonstrating our ability to replicate our business in new markets and to ramp up our customer base." Investors appeared less pleased with the results. The company's stock fell sharply in after-hours activity, trading around 8-3/4, down from a regular day close of 9-5/16. Webvan said it had 160,000 active customers at the end of the second quarter, up 84 percent from the first quarter, and that repeat orders from existing customers accounted for 76 percent of its total orders in the second quarter. Webvan's average order size was $91, althought the company noted that increases in order sizes in the San Francisco Bay Area were offset by smaller orders in Atlanta, partly because it is not able to deliver alcohol there. In an interview after earnings were announced, Webvan Chief Executive George Shaheen said the company expects its $410 million in cash to last through mid-year 2001. "We're looking at cash infusions in Q2 2001 and will consider our options in the equity markts, debt offerings and private placements," he said. Shaheen said the company expects its current growth rate will generate profits sometime in 2003, althought that will depend how swiftly it proceeds into new markets. Meanhile, Shaheen said Webvan was watching all aspects of its expenses and "trying to be as prudent as possible." "I don't think we necessarily have scaled back ... but we have altered our customer acquisition program," he said. Webvan has reduced its advertising on TV, radio and in the print media, and is focusing more on customer retention through lower-cost methods like email and direct mail," Shaheen said. Separately, HomeGrocer Thursday reported a second-quarter loss, excluding unusual items, or $50.2 million or 43 cents per share, compared with a loss lost year of $7.6 million or 52 cents per share. It said its sales grew to $29.8 million from $3.4 million last year. WebVan agreed last month to acquire Kirkland, Wash.-based HomeGrocer in a $1 billion stock deal, that is expected to help lower the company's expansion costs. 20:23 07-13-00