Profits warning rocks Lernout & Hauspie
Article Date: Sep 27 2000Shares in speech and technology group Lernout & Hauspie fell 17 per cent today to a fresh low of $11.75 (810p) on Easdaq as it issued a profits warning ahead of its third quarter results. Roxanna Mohseni reports.
L & H expects to record a net loss before its increasingly heavy goodwill amortisation burden. The rate of acquisitions - more than 50 in the past five years - was one of the reasons put forward to explain the problem.
Newly-appointed chief executive, John Duerden, blames the task of integrating recent purchases, such as Dragon and Dictaphone, for the expected fall into the red. He tellingly admits that 'the most recent distractions' have also contributed to this setback.
This follows the recent fiasco over L&H's recording procedures for its Korean sales, which generate 44 per cent of revenues.
Following press reports that they had been overstated, the US Securities and Exchange Commission has launched an investigation into the company's financial statements. Easdaq is said to be conducting a similar review, if somewhat belatedly.
The news also hit Easdaq-listed FLV Fund, the speech and artificial investment group with close links to Lernout & Hauspie. Shares plunged 7 per cent to a year low of $10.10.
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