Nuix shares tumble after earnings downgrade
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More news: Shares in Nuix tumbled more than 20% in early trading on the ASX after the troubled tech group warned statutory earnings for the first half of FY24 would be between 9% and 19% lower from the same period last year, due to high legal costs related to the ASIC Federal Court hearing. By 10:50am AEDT, shares were still down 14% at $1.81 each.
Nuix warns legal costs to weigh on half-year earnings
The news: Troubled technology firm Nuix expects half-year earnings to be lower than a year ago as it racks up legal costs in its ongoing court dispute with the corporate regulator.
The numbers: The software group expects statutory earnings for the first half of FY24 to be between 9% and 19% lower from the same period last year. Non-operational legal expenses for the half-year are expected at $10 million, compared to $2.4 million in the prior corresponding period. It will release first-half results on 19 February.
The context: Nuix said the fall in earnings was driven by non-operational legal costs primarily related to the ASIC Federal Court hearing. The Australian Securities and Investments Commission has alleged Nuix and its board of directors breached continuous disclosure laws and misled the market by not disclosing its financial underperformance after the firm's initial public offering in December 2020. Nuix reaffirmed forecasts in its prospectus in February and March 2021 before downgrading earnings twice in April and May 2021.
The source: ASX announcement
