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EXCERPTS
Embattled child-care centre operator ABC Learning Centres could be facing further earnings downgrades and restatements of previous years' earnings on the eve of its full-year result, after it suspended its shares from trading last night.
The trading halt comes after sharp falls in its shares over the past two days on high volumes and comes three weeks after it was forced to restate its earnings for 2007 and 2006.
A statement from the company said it needed time to "finalise and provide further guidance relating to its full-year results and prior period adjustments arising out of a reassessment of accounting treatments".
Shares are unlikely to trade until ABC can update its guidance or alternatively announce its full-year result, which is expected late next week.
Analysts had warned more problems could be in store for the company, and a briefing for them to be held earlier this month was postponed.
The move gives further fuel for a shareholder class action, which is being prepared to be lodged against the company for lack of disclosure and misleading comments about its financial outlook.
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The company had valued its child-care licences alone at more than $2.6 billion last year.
But the market fears that inflated book values given to hundreds of its child-care licences could be re-evaluated by its new auditors.
The stock is down 18% in the previous two days' trading and yesterday closed at 54¢.
It hasn't traded at these levels since 2001 when it first listed.
- reprinted from The Age