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RedEnvelope Is in the Black

San Francisco-based specialty gift retailer RedEnvelope Inc., founded in 1997 under the name 911gifts.com, said it has achieved profitability on an EBITDA basis for its fiscal third quarter ending Dec. 31.

The privately held catalog and e-tail company, which relaunched under its current name in 1999, said holiday sales were good with gross merchandising margins of over 50 percent

Although earnings specifics were not disclosed, the company said it expects revenues for fiscal 2002 ending March 31, 2002 to reach $50 million, up 67 percent from last year, and is on track to be profitable for fiscal 2003.

The company, named for an Asian tradition of presenting gifts in a simple red envelope, said that its catalog offerings drove more than half of its sales last year, and had a circulation of approximately six million.

"After a sluggish November, RedEnvelope experienced extraordinary post-Thanksgiving sales momentum, which resulted in two 'million' dollar days in December," said Martin McClanan, CEO. "This strong consumer demand came with minimal discounting, contrary to the industry trend of promotions this holiday season."

Gifts purchased from RedEnvelope are accompanied by a personalized message in a red envelope. Merchandise includes jewelry, gift baskets, personal care products, holiday-oriented gifts, gadgets and tools, and wine and cigars, among other things.