June 29, 1999 3:51 PM PDT
GT Interactive misses in 4Q, looks for sugar daddy
GT Interactive Software Corp. (Nasdaq: GTIS) reported a wider-than-expected loss in its fourth quarter and announced that it had hired Bear Stearns to look into the possibility of either selling or merging the company with another software developer.
Its shares closed off 3/16 to 3 3/4 Tuesday.
In its fourth quarter, GT Interactive lost $72.3 million, or $1 a share, on sales of $93.5 million.
First Call consensus expected the software developer to lose 42 cents a share in the quarter.
Company officials also announced that it has obtained commitments for an additional $30 million in subordinated debt from existing shareholders to execute its growth plan for fiscal year 2000.
"While we have successfully initiated management action, the company is seeking a recapitalization, merger or sale because management believes that in this consolidating industry, GT would benefit from greater capital resources to achieve our long-term strategic objectives and to maximize shareholder value," said CEO Thomas Heymann in a prepared release.
For the year, GT Interactive lost $51.8 million, or 75 cents a share, on sales of $572.3 million compared to a loss of $29.1 million, or 43 cents a share, on sales of $543.1 million in fiscal 1998.
Its shares moved up to a 52-week high of 9 3/8 in July before calling to a low of 2 3/4 in April.
Three of the five analysts following the stock maintain a "hold" recommendation.>