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Home >Industry >Infotech >Logitech drops 6% as SEC probes firm’s financial statements
The shares fell 5.2%, giving the company a market value of $2.1 billion. Photo: AFP
The shares fell 5.2%, giving the company a market value of $2.1 billion. Photo: AFP

Logitech drops 6% as SEC probes firm’s financial statements

Company says its audit committee is investigating a number of accounting matters, which could result in adjustments to its past year's results

Logitech International SA dropped as much as 6.1% after the Swiss maker of computer mice said the US Securities and Exchange Commission (SEC) is investigating its financial statements.

The company is delaying the filing of its annual report for the year through March beyond the deadline of 30 May, Lausanne- based Logitech said in a statement released late Wednesday.

The company said its audit committee is investigating a number of accounting matters, which could result in adjustments to its past year’s results. Some of the issues under review are also subject of a formal SEC probe, in which it’s cooperating. That includes a revision to financial statements concerning warranty accruals and amortization of intangible assets, as well as transactions from 2007 to 2009 with a distributor the company didn’t identify, Logitech said.

“It’s in general not a very good thing when a company is involved in an SEC investigation, as it could lead to negative surprises," Heinz Steffen, an analyst for AlphaValue in Kronberg, Germany, said in a telephone interview. He has a reduced rating on Logitech. “The news is causing uncertainty among investors. However, I think the market reaction is a bit exaggerated."

The shares fell 5.2% to 10.90 Swiss francs at 12:16pm in Zurich, giving the company a market value of 1.9 billion francs ($2.1 billion).

Nancy Morrison, a spokeswoman for Logitech, declined to provide further details on the investigations. Logitech amended a Form 10-K in August, which resulted in upwards revisions for 2011, 2012 and 2013 results, AlphaValue’s Steffen said.

The company reported its first annual sales growth in three years on 24 April, as revenue at its PC gaming, tablet and accessories and mobile speakers businesses surged almost 50%. The company also confirmed its full-year 2015 forecast for $2.16 billion in sales and $145 million in non-GAAP (generally accepted accounting principles) operating income. Logitech on Thursday said it doesn’t expect the probes to affect that outlook. Bloomberg

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