Did AOL’s Patch, a network of hyperlocal news websites, lose more than $100 million this year?

That’s what Business Insider’s Nicholas Carlson [5] reported on Friday, based on internal documents he claims to have received from a source.

According to Carlson’s documents, AOL spent around $140 million on Patch this year while generating just $7.8 million in ad revenue from its “outside” sales force.

"Even if you overestimate Patch's other revenues streams – let's say their total is twice the size of Patch's outside sales revenues – you can still safely say that Tim Armstrong's local news project lost about $100 million this year," Carlson wrote.

When TheWrap reached out to Patch, spokeswoman Janine Iamunno issued the following statement:

“No, there’s nothing to it. The analysis is completely off-base. We are extremely happy with our progress in 2011 and confident in our plans for 2012. While we don’t release internal numbers, we can confirm that, once again, the speculation machine has malfunctioned.”

AOL CEO Tim Armstrong was one of Patch’s investors and the slumping internet giant bought it in 2009, the same year Armstrong took over as CEO.

Patch is supposed to fill in the gaps in local journalism left by the shrinking number of local print newspapers, but even Armstrong said it couldn’t be profitable until the end of this year.

These numbers, if true, suggest it could take a good deal longer.