Sunday January 7 2:23 PM ET Report: Third of Web Companies Endangered

NEW YORK (Reuters) - More than a third of publicly traded Internet firms seem destined to run out of cash by the end of 2001, Barron's financial newspaper reported on Sunday.

According a study for Barron's conducted by Pegasus Research International, publicly traded Internet companies used up about $2 billion in cash in the third quarter of 2000.

That amount is roughly the same as that for the second quarter. The figures cover 335 publicly traded companies in the battered Internet sector.

``We're seeing the financial pressure intensify as never before,'' Pegasus President Greg Kyle said. Previous Barron's reports on Internet companies' cash positions have helped focus investor concerns on the firms' health.

Barron's said the top 15 companies on its list actually were due to run out of cash in the fourth quarter of 2000.

However, many were able to take ``evasive action,'' the newspaper said, such as raising money through a debt offering or through a cash infusion.

Barron's listed seven companies as ``ones to watch'' because of possible news -- some good, some bad -- on their cash positions in coming months.

For example, Barron's noted that retailer Fashionmall.com Inc. (NasdaqNM:FASH - news) had attracted suitors because its stock was trading for less than the value of the cash on its balance sheet.

The focus stocks were: telecommunications provider Choice One Communications Inc. (NasdaqNM:CWON - news), the top company on Barron's list; discount clothing seller Bluefly Inc. (NasdaqSC:BFLY - news); information and entertainment company audiohighway.com (NasdaqSC:AHWY - news); application services provider TriZetto Group Inc. (NasdaqNM:TZIX - news); electronic commerce company Internet Commerce & Communications Inc. (NasdaqNM:ICCX - news); postage service company Stamps.com Inc. (NasdaqNM:STMP - news); and Fashionmall.com. http://dailynews.yahoo.com/h/nm/20010107/bs/net_barrons_dc_1.html

-- Carl Jenkins (somewherepress@aol.com), January 07, 2001