For the best part of half a year now, satellite broadband group, Speedcast has been on the suspicion list after a series of shock and surprising downgrades drive now it seems by an acquisitions regime that has gone wrong.
The shares have fallen sharply since last August when the first update and downgrade saw them plunge from around $1.715 on August 26 to 76 cents on August 29.
Since then the company has been hit by more downgrades, revenue problems, and more signs that recent acquisitions have gone bad. The shares were at 79 cents when trading was halted before the opening on Tuesday.
The halt was requested by the company which then issued a statement revealing that CEO PJ Beylier, whose acquisition spree has left the company with debt problems and an underperforming business, was leaving the company.
But before he did he issued another statement revealing another downgrade and a promise of the board reviewing “all elements of the preliminary FY19 result” (which are his results).
He’s going after telling the board that the December financial year result for 2019 result would be more than 10% below previous guidance.
According to Tuesday’s statement from Speedcast, the downgraded result included items such as procurement savings and the sale of minor surplus assets that do not contribute to ongoing earnings. Non-core assets will now be sold, but there were no ideas revealed abut just what they might be.
As the core result and non-trading items might not be within the range anticipated by the market, the board said it is giving the result closer scrutiny to see if any other matters should be accounted for in FY19, and if “additional market disclosures are required.”
Speedcast directors Peter Shaper and Joe Spytek will run the company while it searches for a new CEO.
Speedcast shocked the market last August with a $175.6 million loss, which led its auditors to warn about the “material uncertainty” over its ability to continue as a going concern due to the loss, cash outflows, and a $US655 million debt load.