Brits help eBay to record profit

ONLINE auction house eBay recorded a 28% rise in first-quarter net profit to $256.3m (£133.5m), boosted by good growth in Britain, where it now has 10m registered users.

Revenues rose to $1.03bn from $756.2m a year ago, providing some cheer after the preceding quarter, which prompted fears that growth in its core business was stalling in the US and Germany.

But the figures were not enough to convince investors the company is back on a growth track. Worries over future growth prospects and a squeeze on margins have already seen its shares slump by more than 40% this year.

Ebay is the world's largest shopping mall, selling everything from clothing to furniture and classic cars, and boasts a host of well-known fans, including the Prime Minister's wife Cherie Blair, who used it to buy a 99p Winnie the Pooh alarm clock for her young son Leo.

Describing it as 'a wonderful quarter' for the group, chief executive Meg Whitman said: 'The eBay community is thriving, and we're in an excellent position to deliver on both the top-line and profit goals we've set out for 2005 and beyond.'

The number of registered users worldwide leapt by 40% to just over 147m, with active users (those who have bought, sold or listed an item in the past year) rising by 34% to 60.5m.

The group said that 12 product categories had delivered annualised revenues of $1bn or more in the quarter, including eBay Motors at $12.9bn; consumer electronics at $3.4bn and computers at $3.2bn.

Clothing and accessories contributed $3.1bn; books/movies/music $2.7bn; home and garden $2.2bn; collectables $2.2bn; sports $1.9bn; toys $1.7bn; jewellery and watches $1.6bn; business and industrial $1.4bn and cameras and photos $1.3bn.

Concerns over a slowdown in the group's key markets of the US and Germany were first raised in the final quarter of last year and Whitman said today of the German business: 'We are currently seeing slower growth than we would like,' though she added that trading had picked up in the US after a slow start.

The UK has been growing well, as has South Korea, and eBay has high hopes for the markets of China and India.

The company saw a 57% increase in the number of people using PayPal, its online payment service, to 71.6m.

It expects sales of $4.27bn to $4.36bn compared with the $4.25bn to $4.35bn predicted in January.