Things must be worse than we know at embattled satellite broadband provider Speedcast after it yesterday extended its trading suspension until February 27, or the release of the company board’s review of “all elements of the preliminary FY19 result.”
No further detail was offered in the update which came on the day Speedcast nominated last week for more information in the wake of last year’s departure of its CEO and earnings downgrade.
That clearly didn’t come and now the company could be suspended from trading for more than three weeks. Last week the company went into a trading halt after ditching its CEO and issuing an earnings downgrade.
The company’s chief executive PJ Beylier was dumped last week in the wake of an acquisition spree that has left Speedcast with an unwelcome debt burden and underperforming businesses.
His departure was announced as the company also confessed that the former CEO had told the board that the December 31, 2019 result would be more than 10% below previous guidance.
Hence the decision to review all the company’s finances and the 2019 result as quickly as possible. That now seems to have thrown up more problems, leading to a further delay.
Speedcast 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.
Meanwhile, shares in Treasury Wine Estates (TWE) hit a two year low in yesterday’s widespread sell-off as more shareholders abandoned the winemaker in the wake of the recent surprise earnings downgrade for 2019-20.
The shares fell 20 cents yesterday, or 1.7%, to $11.77. Two weeks ago shares were at $16.68,
The shares slumped 26% the next day (on January 29) to $12.35, in the wake of the late evening downgrade.
US fund manager, The Capital Group yesterday told the ASX it was no longer a substantial holder in TWE after selling 7.4 million shares. This includes JP Morgan selling 6.3 million shares to hold 26.8 million.
At the start of the year, JP Morgan held 42.1 million shares. And State Street in late January sold 1.2 million shares to hold 8.2 million, down from 11.4 million earlier this year.