Surfstitch placed in trading halt on earnings warning

Tuesday, 7 Jun 2016 14:25:02 | Justine Parker

Shares in the embattled online sports shop Surfstitch have been placed in a trading halt as the company flags another revision to its earnings forecasts.

Surfstitch shares closed yesterday at just 40.5 cents, less than half its $1 a share listing price just 18 months ago.

In a statement, chief financial officer Karen Birner requested the shares be halted until the firm makes an announcement on its earnings forecasts.

"The trading halt is necessary to provide the market with a further update on its anticipated pro-forma EBITDA for the year ending 30 June 2016," Ms Birner said.

Last month, the Sydney-based global retailer slashed its 2016 earnings forecasts after embarking on a costly restructure and rebranding to create a "unique digital content-driven ecosystem which engages audiences at every stage of their action sports lifestyle".

The former market darling, which traded at an all-time high of $2.13 in November, warned that full-year earnings before interest, tax, depreciation and amortisation (EBITDA) would come in between $2 million and $3 million, down 60 per cent on the $7.7 million result in 2015.

Surfstitch has been under a cloud since March, when co-founder and former chief executive Justin Cameron unexpectedly left the company.

At the time, Mr Cameron was understood to be considering a bid to buy back the company with a private equity partner, but the company is yet to receive any approach from Mr Cameron or a private equity firm.

Mr Cameron founded Surfstitch with the firm's current co-chief executive Lex Pedersen.

AustraliaPlus

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Surfstitch placed in trading halt on earnings warning

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