Haulage firm investigation
Stobart CEO leaves and shares suspended amid accounts probe
Shares stalled: Stobart lorries are a familiar sight (pic: Eddie Stobart)
Haulage firm Eddie Stobart suspended trading in its shares after announcing that its chief executive Alex Laffey will stand down as the firm investigates alleged accounting discrepancies.
The firm, known for its green and red liveried lorries, also issued a warning that its results for the first half of 2019 would be “significantly lower” than forecast.
A review is being undertaken by chief financial officer, Anoop Kang, who joined in April, alongside auditors PwC. It found that in 2018 operating profits were overstated by about 4%.
The logistics company announced that the board is applying a “more prudent approach to revenue recognition, re-assessing the recoverability of certain receivables, as well as considering the appropriateness of certain procedures”.
Publication of the firm’s results for the six months to 31 May has also been delayed, They were due to be released on 29 August, but are now expected in early September.
The dividend policy will also be reviewed. It announced in December that PwC was replacing KMPG as its auditors.
Outgoing chief executive Mr Laffey will be replaced after four years in the role by Sebastien Desreumaux currently chief executive of the iForce business and head of contract logistics.
The revisions have also shone a spotlight on under-pressure investment manager Neil Woodford, who is the largest shareholder in Eddie Stobart, with a 22.9% stake.
In June this year, Mr Woodford suspended trading in his largest fund after rising numbers of investors asked for their money back.