GenesisIntermedia.com Ends Year With Share
Price Up 195%
 Revenue: The Van Nuys firm, which sells goods through
telemarketing and infomercials, is the top gainer in publicly traded
Valley businesses.
By ANDREW BLANKSTEIN, Times
Staff Writer
 VAN
NUYS--GenesisIntermedia.com finished 2000 as the top gainer
among publicly traded San Fernando Valley businesses, with its stock
surging 195% on the year, to close Dec. 29 at $17.13.
The company generates most of its revenue
selling consumer goods--including health and fitness products and
self-help materials--via infomercials and direct telemarketing campaigns,
said Robert Bleckman, director of investor relations for the company.
Bleckman said the company is putting most of
its energy into a new venture to provide free Internet access and
advertising at mall kiosks. The company operates these kiosks, through its
Centerlinq system, in 32 malls around the U.S., Bleckman said.
The program has been costly. In a recent issue
of Barron's, the company was ranked No. 1 among 339 dot-com companies that
"burned" through more cash than they took in.
 In its most recent financial filing,
the company reported a loss of $4.2 million for the quarter ended Sept.
30, compared with a loss of $2.3 million for the like quarter in 1999.
Bleckman attributed the losses and the
high "burn rate" to the company's expansion of the Centerlinq
informational kiosk system.
"It's an
investment we need to make," Bleckman said. "We anticipate [reaching a]
break-even point in the third quarter 2001, where we can sustain our
initial investment."
In a Securities and
Exchange Commission filing last week, it was disclosed that Saudi
financier and arms dealer Adnan Kashoggi had acquired a 33% stake in
GenesisIntermedia through his Bermuda-based holding company, Ultimate
Holdings Ltd.
GenesisIntermedia Chief
Executive Ramy El-Batrawi told Bloomberg News that he has worked with
Kashoggi on deals dating back to 1988 and speaks with him "almost every
day."
* * * The company has kept a
low profile through most of its existence, which may have helped it as
dot-com stocks tumbled this year, said Rohit Shukla, vice president of the
Los Angeles Board of Information Technology Commissioners.
"There is a virtue to toiling in
relative obscurity and that definitely applies here," said Shukla, adding
that because it is closely held, GenesisIntermedia "was more insulated
from the vicissitudes of the market."
The company, founded in 1993, has been
at its current Van Nuys location since fall 1999. There are 250 employees
at company headquarters and 150 at a telemarketing center in Utah.
"We like to maintain a low-key approach
for a number of reasons," Bleckman said. "Mainly, because we let our work
and products speak for themselves. The stock price has maintained its
stability, while others have lost their values."
Last month, the company announced an
offer to pay $49.1 million in cash and stock to acquire full ownership of
Fashionmall.com, in which it already has a 7% stake.
Fashionmall.com, an online "mall" for
lines of designer clothing, is evaluating the offer.
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