Agency.com Announces Layoffs

NEW YORK-Agency.com joined the layoff parade Thursday, announcing plans to let go about 190 employees and close its Vail, Colo., office as part of an effort to save $12-16 million next year.

“We are taking this opportunity to realign our business to respond to the rapidly changing demand environment for Internet consulting services,” said Chan Suh, chairman and CEO of the New York-based interactive agency. “We are taking these steps now to protect our profitability and in an effort to align our business to deliver revenue and earnings growth in 2001.”

The agency said it will take a one-time charge of $11-14 million in the fourth quarter, due primarily to severance packages and the costs of closing the Colorado office. The company said it expects to have $65-70 million in cash on hand as of Dec. 31.

Agency.com said it expects to post fourth-quarter revenues of between $56-58 million and earnings per share (before amortization, noncash compensation and any one-time charges) of 4-7 cents. A survey by Firs t Call/Thomson Financial has analysts expecting that figure to hit 7 cents in the first quarter.

Going forward, Agency.com said it expects revenue to grow 23-27 percent in 2001, with cash earnings per share growth of 30-35 percent.