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Empired denies sensitive info leaked following share price tumble
WA-based IT services firm Empired has denied that a leak of sensitive earnings data was behind a big drop in its share price over the past week that saw the value of its stock drop 21 cents.
Russell Baskerville The ASX yesterday asked Empired if it could account for the rapid price drop from 77 cents to 56 cents, and whether it knew of "any information ... that has not been announced to the market" that could explain the fall.
Empired entered a trading halt yesterday and this morning denied to the stock exchange that any sensitive information had been leaked.
The company told the ASX it had generated earnings data prior to its public trading update this morning for internal management purposes, but was not aware of it having leaked.
As of 11am this morning, its stock had dipped even further to 44 cents.
Empired's trading update today revealed the firm had been grappling with financial troubles in recent months.
It said “transitional” difficulties had impacted the first half of financial year 2016.
Costs included a $4.1 million restructure of the Australian sales team; delays in commencement of new contracts, at a cost of $1.1 million; and a once-off plant and equipment write-down of $2.3 million after consolidating nine offices to three.
“Whilst we have delivered strong top line growth, we are disappointed by the number of items impacting profitability in the first half and are confident that these items are either one-off or transitionary in nature," Empired managing director Russell Baskerville said in a statement.
“The initiatives undertaken during the first half of financial year 2016 have been critical in positioning the organisation for long term sustainability and improved margin performance which we consider prudent in uncertain economic times.”
For the entire 2016 financial year, Empired narrowed its revenue forecast to a range between $159 million and $169 million.
Despite the first-half difficulties, Empired’s numbers stack up well compared to previous years. The 2015 fiscal year saw it rake in $128.3 million in revenue, up 92 percent from $67 million in 2014.
