Slater & Gordon shares suspended ahead of earnings

by Jonathan Adams

Slater & Gordon shares have been suspended from trading ahead of the company reporting its interim results on Monday, February 29.

In a statement to the Australian Securities Exchange, company secretary Moana Weir said ‘certain material items’ had not been finalised, such as the goodwill values for impairment of the UK business.

The “voluntary suspension” is so that the company can meet its continous disclosure obligations ahead of finalising a potential goodwill write-down.

Slater & Gordon said “it continues to work with its auditors and external advisors to finalise and confirm” these items.

Shares of Slater & Gordon closed on Tuesday at 83¢, valuing the law firm at just under $300 million. In late March, the personal injury law firm’s market capitalisation peaked at almost $2.75 billion.

The company showed $1.15 billion of “goodwill” on its book when it reported full year financial results for 2015.

In March, Slater & Gordon acquired the professional services division from UK listed firm Quindell for $1.3 billion, of which $710 million was a “goodwill” consideration. However that acquisition has proved ill-fated, straining the law firm’s cash flows, while touted regulatory changes have cast doubt over future profits from fast-track road accident claims.

Slater & Gordon’s lenders have appointed advisers to assess the company’s books.

Recent disclosures from Westpac, a major lender to Slater & Gordon, showed it had increased provisions relating to a property and business services loan, which the bank told analysts was an exposure to Slater & Gordon.

This article is for information purposes only.
Please remember that financial investments may rise or fall and past performance does not guarantee future performance in respect of income or capital growth; you may not get back the amount you invested.
There is no obligation to purchase anything but, if you decide to do so, you are strongly advised to consult a professional adviser before making any investment decisions.

Related News

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Know more