Vicinity Corp. Lands Another Major Hotelier

Consumers visiting any of the family of Accor Web sites will be able to locate the nearest hotel to their destination location. Vicinity already has done the same for Marriott Corp., British Airways, Bass Hotels, Starwood Hotels, Promus Hotel Corp., Hilton, Choice Hotels, Rand McNally, Alamo Rent-A-Car, Sigma (Alitalia group) and fodors.com.

Accor's director of e-commerce Jean-Christophe Defline says he chose Vicinity for the speed and efficiency of its technology as well as the ability to integrate more capabilities at a later date. Vicinity's president and CEO Emerick Woods says companies are looking for this service in general because "local marketing has become crucial (now that) consumers are now able to access hospitality providers, as well as merchants and service providers, in their own backyards."

Vicinity's "Business Finder" software helps these companies integrate a private-label, Web-based locator into their Web sites to provide users with multiple search capabilities for finding Accor locations worldwide. Rapid adoption of this technology -- by not only hospitality clients but also the likes of McDonald's, Pizza Hut, Starbucks, Taco Time, Toyota and Levi Strauss & Co. -- turned Vicinity Corp. into the No. 1 business-to-business site based on primary category rankings for June and July 2000 according to Media Metrix.

Despite all that, the young company has yet to turn a profit. Indeed, the company last week warned that it would record lower than previously estimated revenue and high than expected losses for its second quarter of fiscal 2001 ended Jan. 31, 2001. Actual results will be announced Feb. 21.

The company anticipates second quarter revenues to be in the range of $5 million to $5.1 million. The loss per share, excluding non-recurring expenses, in the second quarter will be in the range of 22 cents a share to 23 cents a share. The company had previously issued earnings guidance in the range of 19 cents a share to 21 cents a share for the quarter.

The company blamed "tightened" client marketing budgets and infrastructure spending resulting in a "lengthened sales cycle." Vicinity also incurred approximately $1.1 million or approximately 4 cents a share in restructuring charges associated with previously reported layoffs and certain other corporate actions that took place during the second quarter.

The news led Wedbush Morgan to downgrade the stock from "attractive" to "hold," and it appears shareholders have heeded that advice. On volume of just 32,000 shares – less than 2% of average volume, Vicinity stock was trading for $2.50 a share at the close of markets Tuesday. The share price is down more than 94% from when it shot out of the blocks in March 2000 and crested $75, but up from a 52-week low of $2 that came in late December.