Netbenefit, the internet domain name registration company, has posted a maiden loss of £473,421 for its half-year and says it expects to stay in the red until 2001 as it pursues an aggressive expansion plan.
Netbenefit was profitable prior to its listing, last June, on the Alternative Investment Market, Aim.
Acquisitions such as domain registration firm NetNames in January and other alliances with WorldPay, a specialist internet payment processor, have required greater staff numbers which have partly led to Netbenefit's losses.
This was further compounded by provisions for national insurance contributions in respect of share options.
Staff numbers have grown by some 150% to 47 since December 1998.
Jonathan Robinson, chief executive of Netbenefit, said: "We came to the market as a profitable company in June last year and we have a profitable underlying business model. Yet we have had a strong message from investors to go for growth right now and get customers on board."
Netbenefit's shares jumped 17% to £14.75. The company's revenue during the six months to December 31 doubled to £1.69m - yet revenues in February alone were £1.1m once the acquisition of NetNames was included.
Netbenefit sources 70% of its revenues from domain name registrations, with its number of websites hosted and managed now exceeding 75,000.
The remainder of its sales come from providing e-commerce, email and other business services to companies.
Analysts, however, remained concerned that Netbenefit's sales and administration costs continued to grow at a faster pace than revenues.
Mr Robinson said the key for Netbenefit's future profits would be driving repeat business from those companies whose initial approach is to register a domain name.
Netbenefit is expected to return to profitability within 18 months - after it has made a series of further acquisitions.
Mr Robinson said these acquisitions would be funded by shares and cash, despite jitters in global stock markets about technology-related stocks. "I think the market is bound to have its wobbles. It's a volatile and rapid growth sector."
