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Agile forecasts loss, weak sales

A day after its high-profile merger went up in smoke, the software developer warns it will miss fourth-quarter estimates.

Agile Software jumped on the profit-warning bandwagon Tuesday, telling Wall Street it will post a loss in its fourth quarter on weaker-than-expected sales.

It's been a rough 24 hours for Agile considering it and Ariba announced Monday that they nixed their plans to merge in a deal that was valued at more than $2.5 billion in late January.

Now Agile expects to post a loss of between 3 cents and 6 cents a share in its fourth quarter on sales of between $26 million and $27 million.

Agile shares closed off 20 cents to $10.31 ahead of the warning before falling to $9.51 in after-hours trading.

First Call consensus expected the business software developer to earn 2 cents a share on sales of $28 million in the quarter.

Agile executives also said the company would take a one-time charge of $5 million related to the termination of its merger with Ariba. It will also take a "significant" charge in the quarter for its investments and the possible write-down of goodwill related to its 1999 acquisition of Digital Market.

"While we are currently comfortable with our estimates for the fourth quarter," Chief Executive Bryan Stolle said in a statement, "we are mindful that in the last few months economic conditions have declined very rapidly and that many IT companies were not able to close expected business in the last month of their quarter, which negatively impacted their results. There can be no assurance that the same thing won't happen to Agile."

Stolle said the company does not plan to reduce its work force at this time, but will be "slow hiring" until it gets a better indication of how long the current economic malaise will affect its operations.

Last quarter, Agile posted a profit of 1 cent a share on sales of $25 million.

Its shares moved up to a 52-week high of $98 a share in September before falling to a low of $9.19 earlier this month.

Six of the nine analysts following the stock rate it a "buy."