Company Forced to Restate Revenue as Shares Devalued More than 50% Since Insider Sell-Off Last Summer, Renaming of Election Division to 'Premier'...
Following a short "dead cat bounce" at the end of last month, after a precipitous six-month stock price plunge devaluing the company's net worth by more than 50% since an insider sell-off last August, Diebold's fortunes began turning south again late last week as the company was forced to begin restating previously-inflated revenue figures from 2006 and 2007.
The company's stock price is continuing to plunge today towards a seven-year low, after it admitted last week that it had over-estimated revenues of its election systems division by more than 300%.
As well, the company announced it will soon be laying off 5% of its full-time global workforce. The restatement of revenues comes as part of a deal worked out with the SEC, which continues its ongoing investigation into the financial practices of the once-great, now-disgraced company. Diebold also acknowledges that it is still being investigated by the DOJ, although the reasons and details of that particular investigation remain undisclosed at this time.
The 50% decrease in the company's share price began just after a number of company executives sold off several thousand shares of stock, all on the same day in August of last year, at $53.05/share, very near the company's 52-week high of $54.50, as The BRAD BLOG reported exclusively at the time. In the following week, the company's share price fell 15% just before the management attempted to misdirect investors by renaming their election division in order to offer "a fresh identity for our company."
Following the insider trading and fresh identity, now dubbed "Premier Elections Solutions," the company's share price has continued to fall ever since. The stock is down more than 3% so far today, selling currently at $24.64/share.
A statement released by the company late last week reveals once again that, despite the attempted name change bait-and-switch, the company still bears the liabilities of the old Diebold elections division; the company admits that the SEC and DOJ investigations continue and sales are sharply off for its voting systems, which have been decertified by several states after being found easily hackable and error-prone in study after study over the past year.
As well, there is a Securities Fraud class action lawsuit still pending against the company, as investors cast the only vote that counts --- the one that hits the 150-year old company in the pocket book. The company that made its bones in the security business has tumbled quite a ways since untouchable crime-fighter Eliot Ness served as chair back in the 1940's.
In the wake of its latest round of misfortunes/karmic return, Diebold announced plans for layoffs of some 800 workers last week. We're not happy to hear that. Though if any of those who find themselves out of a job due to the arrogance, corruption, and general failure of this company to perform as a responsible corporate citizen would like to share any inside information, we'd be delighted to hear from you. Your confidentiality, as needed, will always be respected by The BRAD BLOG.
A partial restatement of 2007 revenue estimates, released by Diebold last week in the wake of the SEC investigation which has forced it to discontinue its previously misleading practice of declaring revenues before products were actually delivered, reveals that the company continues to be rocked by its failing election division, newly renamed or otherwise...
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