Corel profits head south

Corel Corp. warned investors today that it would declare a net loss for the fourth quarter of around $95 million on sales of just $44 million.

The numbers represent a stark reversal of the year-earlier quarter, when Corel posted net income of $6.5 million on sales of $125 million. Since then, the company's financials have flagged; when it posts results January 13, it will mark Corel's third straight quarterly loss.

The company said it was hurt by a move to lower the amount of inventory in the sales channel and by a write-off for "obsolete" inventory.

"Following the reductions in the quarter, we are extremely comfortable with the amount of inventory currently in the distribution channel," said CEO Michael Cowpland in a release. "With our recent move to just-in-time inventory, we feel we are now in a good position to report numbers that are more representative of actual sales as we move into future quarters."

The Ottawa company said it had bought up $4.1 million of its shares during the quarter.