Circulation cuts and poor response widened losses for Geerlings & Wade Inc. one month after its CEO was forced out.
For the second quarter, the wine cataloger reported a loss of $2.3 million, up from $128,021 for the same period last year. The quarter ended June 30.
The firm also posted sales of $6.2 million, a 20.9% drop from $7.8 million one year ago.
The firm warned two months ago that it expected to report significantly lower sales and a greater loss then expected for the quarter. The Canton, MA-based company attributed the results to weaker response to its mailings, a 38% cutback in its prospect circulation and increased marketing expenses for test mailings to both prospects and existing customers.
Last month, company president and CEO David R. Peace was asked to step aside and was replaced by Huib E. Geerlings as interim president and CEO (DIRECT Newsline, July 1).
For the year ended Dec. 31, Geerlings & Wade posted a 12.1% decline in sales to $32.7 million. Poor response and a 22% cut in prospect mailings also contributed to a before-tax loss of $1 million for the year, compared to a $471,000 loss in 2000.
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