PurchasePro hit with more negative press over delays

Kevin Ferguson

Thursday, May 17, 2001 | 10:59 a.m.

Richard Clemmer, PurchasePro's newly hired chief financial officer, apparently has quite a job ahead of him in organizing the company's books.

The former CFO of Quantum Corp. came on board Wednesday, a day after the Las Vegas-based Internet company missed a deadline to file its quarterly financial report with the Securities and Exchange Commission.

In a note to the SEC, the business-to-business electronic purchasing company said it could not file its 10-Q financial report in time "due to unanticipated delays in the completion of certain information."

A PurchasePro spokesman would not comment further.

One analyst remains skeptical about the company's future.

"I think the problems run a lot deeper than what the CFO can solve," said George Santana of Wedbush Morgan Securities. "There's been cutbacks in IT spending throughout the industry and sales have been consolidated in the major players."

Santana noted that the turmoil at PurchasePro could hurt the perception of the company by potential clients when the company's sales people are trying to close deals. And that could overshadow the company's quality technology, Santana said.

Indeed, PurchasePro was hit with more bad publicity this morning over the delayed filing. News of the delay was carried by Dow Jones. And the website TheStreet.com published a story with the headline "PurchasePro Blows Its 10-Q -- Again."

"What rhymes with PurchasePro? Doh!" the story said.

The 4 1/2-year-old company, which employs a staff of 500-plus, develops marketplaces for businesses to buy and sell products online.

The delayed financial report comes just three weeks after PurchasePro shocked its investors with an 11th hour announcement April 25 that its earnings would fall short of expectations.

Just a few hours later that same day, the company postponed its earnings release until the next day.

PurchasePro shares have lost nearly 95 percent of their value from their 52-week high of $47.75 reached Sept. 29. This morning the shares were trading at $2.48. The stock sunk Wednesday to a 52-week low of $2.10 before rebounding to $2.53.