Online Grocer Foresees Grim Future
FOSTER CITY, Calif. (AP) _ Online grocer Webvan Group Inc. could be nearing the end of the aisle.
In its annual report filed Monday with the Securities and Exchange Commission, Webvan said it needed a substantial infusion of new capital to stay in business past the fourth quarter of this year.
In a note attached to the company’s 2000 financial results, auditors Deloitte & Touche said there was ``substantial doubt about Webvan’s ability to continue as a going concern.″
Foster City-based Webvan takes online orders for groceries, CDs, books and other household items and delivers them in Atlanta, Chicago, Sacramento, San Diego, the San Francisco Bay area, Los Angeles, Seattle, Orange County, Calif., and Portland, Ore.
Webvan, which has former Netscape CEO James Barksdale and Yahoo chairman Tim Koogle on its board of directors, notes that the Internet has not taken off as a medium for grocery shopping, with not enough customers placing repeat orders. Net losses rose from $144.6 million in 1999 to $453.3 million in 2000, when Webvan merged with HomeGrocer Inc.
Webvan’s stock, which debuted at about $26 in its initial public offering in late 1999, was trading at 13 cents Tuesday afternoon on the Nasdaq Stock Market. Webvan could soon be delisted from the Nasdaq, unless the company is willing to institute a reverse stock split.
A company spokesman did not immediately return a call seeking further comment Tuesday.
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