Critical Path Shares Plummet on Loss Report

Critical Path Inc. shares plunged 55%, hit by a surprise fourth-quarter loss and the company’s warning of another loss in the first quarter. After the markets closed Thursday, the Internet e-mail software provider posted an operating loss of $11.5 million or 16 cents a share, rather than a profit of 1 cent as analysts expected. Sales were $52 million, up more than sixfold from the year-earlier period. Chief Executive Doug Hickey had said last month that the company was on track to turn a profit in the fourth quarter. The company blamed the fourth-quarter shortfall on higher costs from the acquisition of PeerLogic Inc., dot-com customers going out of business and an accounting change that required the company to defer $7 million in licensing revenue. For the current quarter, Critical Path said it expects a loss of 15 to 16 cents a share, instead of the 3-cent profit analysts forecast. Shares of Critical Path fell $11 to close at $9 in heavy trading on Nasdaq. The stock is off its 12-month high of $119.50, set in March 2000.