Vocus has been served with a class action proceeding filed in the Federal Court of Australia.
The proposed class action was flagged by Slater and Gordon in September 2017, alleging that Vocus misled shareholders over its FY17 financial guidance, saying it had “no reasonable grounds for the original FY17 guidance issued in November 2016."
In August 2017, Vocus released unaudited results for the 2017 financial year, bringing in a net profit after tax (NPAT) of $152.3 million, way below the company’s guidance range of $160 million to $165 million.
According to the Australian telco, this downgrade was primarily due to higher than forecast net finance costs and a higher effective tax rate at 33.4 per cent.
This followed the company’s move in May to wipe off $100 million from its revenue target for the financial year ending 2017, blaming the forecast downgrade on lower than expected billings in its enterprise and wholesale business, and re-jigged terms on a number of large projects.
The class action was brought against Vocus on behalf of persons who acquired an interest in Vocus shares from 29 November 2016 to the close of trade on 2 May 2017.
The Statement of Claim includes allegations of contraventions of the Corporations Act 2001 (Cth) in relation to misleading or deceptive conduct and continuous disclosure obligations in respect of Vocus’ FY17 earnings guidance, Vocus told shareholders on 30 April.
“Slater & Gordon have filed a class action in respect of Vocus’ FY17 earnings guidance," Vocus said in a statement.
"Vocus takes its obligations seriously and maintains that it has complied with those obligations. Vocus intends to strenuously defend this proceeding. In the meantime, the Vocus management team remains focused on executing against its long term strategy to generate value for its shareholders.”
"Vocus intends to defend this proceeding," the company told shareholders.