Digitas: 2Q Generally Down

Digitas on Monday reported a generally down second quarter, with a net loss of $33.5 million on revenue of $60.5 million.

The bad news had been expected and was generally in line with numbers reported by competing i-shops.

Digitas’ quarterly loss rose from $5.3 million for the same period a year ago; revenue was $70 million for the same year-ago period.

The loss was attributed mainly to a $16.9 million charge related to layoffs and other restoring efforts, a company representative said.

Boston-based Digitas has cut more than 180 people worldwide since the year began; the shop still employs about 1,600.

The representative would not discount future layoffs — even as soon as the current quarter — but hastened to add that such cuts are not considered imminent.

The company expects third quarter revenue to be flat compared with the second quarter, with a 5% variation depending on the commencement of new client work.

Digitas’ stock of late has dipped into the $3 range after peeking at $40 last year. The company last quarter was involved in talks about an acquisition by–or affiliation with–the Interpublic Group of Cos., sources have said, though neither Digitas nor IPG officials have confirmed that such talks were underway.

Digitas on Monday reported a pro-forma cash loss for the quarter of slightly less than $6 million, or 8 cents per diluted share, discounting the effect of the restructuring and other charges. In the second quarter of 2000, the company reported pro-forma cash earnings of $5 million, or 7 cents per diluted share. Taking the charge into account, the pro-forma cash loss for Q2 2001 was more than $16 million, or 23 cents per share. Overall, the net loss for the quarter was 57 cents per share, compared with a net loss of 9 cents per share a year ago.