Homestore Error Tops $113 Million

Homestore.com Inc. said it overstated revenue by as much as $113million in the first nine months of 2001, more than the $95million the biggest online home listing company had estimated.

In 2000, revenue was overstated by $39million to $45million, the Westlake Village-based company said. Homestore.com originally said it had $351million in revenue through the first nine months of 2001 and $229million for all of 2000.

Homestore.com said last month it found advertising sales that should have been accounted for as barter transactions because they were related to purchases of goods and services by the company. The discovery led to the ouster of Stuart Wolff, its chief executive.

The company’s shares last traded Feb. 12, closing at 72 cents. The Nasdaq Stock Market, which had halted trading as it sought more information, announced trading will resume today. The new estimate of the amount by which revenue was overstated for 2001 ranges from $104million to $113million, up from the company’s’ previous estimate of $54million to $95million.

The increase in the size of the overstatement in part reflects sales of software and services that shouldn’t have been included in revenue, said DeLise Keim, a company spokeswoman. That amount, about $7 million to $23 million, will be recorded as deferred revenue, she said.

Homestore.com, which has more than 90% of the home sale listings on the Internet, manages the Realtor.com Web site for the National Assn. of Realtors. Its biggest shareholder is New York-based Cendant Corp., which has a 12% stake.