Spire Global slumps after accounting issue delays results

Spire Global

15/08/2024 17:21

** Shares of satellite operator Spire Global  SPIR.N  tumble
28% to $7.14, lowest since January; on track for worst day since
March 
    ** Company says unable to file report for quarter ended June
30 within prescribed time period, as per filing with the U.S.
SEC after market close on Wednesday and shortly before scheduled
quarterly earnings call 
    ** There are issues with accounting practices for revenue
from some "space as a service" contracts - SPIR  
    ** Company says it may not be in compliance with maximum
debt to EBITDA (earnings before interest, taxes, depreciation,
and amortization) leverage ratio covenants under financing
agreement 
        **  Craig-Hallum analysts lower PT on SPIR to $8 from
earlier $13, cut rating to "hold" from "buy"
  
        ** "Restatement appears highly likely and if that is the
case, it would appear that 10+ quarters of financials may be in
question" - Craig-Hallum analysts Jeff Van Rhee and Daniel
Hibshman 
    ** Company is likely "at the start of a fairly long and ugly
road to dig out of this" - analysts Rhee and Hibshman 
    **  SPIR was expected to report a 14.7% increase in revenue
and loss of 25 cents/shr - LSEG data
    ** Stock has lost 7.6% year-to-date

 (Reporting by Lisa Mattackal in Bengaluru)
 ((LisaPauline.Mattackal@thomsonreuters.com;))