Monday, April 07, 2014 5:14 PM / Research
The delay in earnings report by any quoted company is usually a pointer to unknown distress, in which investors should be well guided against if it is becoming a tradition i.e. forming an ugly pattern, just as in the case of FIRST BANK HOLDING Plc.
It is mandated by listing and disclosure rules that quoted firms should prepare and publish earnings report within 45days and 90days following a financial year end.
In the recent time, Forte oil Plc led the pack to present its audited report Q4’13 within the stated period- we sincerely commend this recovery approach in both financial strength and the corporate governance face of the company.
However, it is becoming worrisome as First Bank Holding Plc is yet to present after a deadline period of March 31 2013. Meanwhile, history revealed that First bank holding Plc is usually presenting last and of course very late in the sub-sector, while other HoldCos have presented- The reasons for this intentional act remained unknown and worrisome to investors.
In our opinion, this usually impact negatively the stock price of the firm while it puts the investors loyalty on the fence- this is usually taken as a sign of a negative earnings surprise, and a sell-off may follow.
In addition, most of the reasons for this tradition of delay are not seen as tangible enough- we advise the firm to embark on retracement of this tradition and trend in its own interest.
4-Year History of Delayed Earnings