Freeserve said its net loss narrowed in the fiscal third quarter as the rate of subscription, ecommerce and advertising revenue grew, but analysts remain unimpressed.
The UK internet service provider said that in the period subscriptions grew by 50 per cent and ecommerce and advertising revenue went up by 55 per cent. It now has 1.82 million registered subscribers.
Ecommerce and advertising revenue went up to £2.8m from £1.85m in the previous quarter. Sales figures include a share of phone tariffs paid by Freeserve members when they dial the service.
Analysts, however, said that although the results are good on first sight, the portal is still failing to make headway in market share. "We continue to see the stock drifting from the 450p to 650p range and are calling it an underperformer," said Miles Saltiel, an analyst for brokers WestLBPanmure.
Freeserve was forced to drop per-minute charges and replace it with a flat fee following pressure from competition, including BT. To compensate for this loss of revenue, the company plans to offer additional revenue generating services including sports betting and lottery tickets.
Also today Freeserve confirmed it has acquired Intracus, an online host of fan clubs and associations on its SmartGroup.com website, for £60m in shares.
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