Join our daily newsletter At The Bell to receive exclusive market insights
- Shipbuilders Austal (ASB) is setting sail for the Federal Court of Australia following allegations from a watching ASIC
- ASIC claims Austal failed to tell shareholders of a material loss in 2016
- The material loss relates to the US Navy ships at its shipyard in Mobile, Alabama
- Austal is considering the documentation provided by ASIC before it decides the next steps
- On the market, Austal is down 0.22 per cent and is trading at $2.32 per share
Shipbuilders Austal (ASB) is setting sail for the Federal Court of Australia following allegations from a watching ASIC.
The court action has been taken against the shipbuilder and its former CEO David Singleton.
The corporate watchdog claims that Austal left shareholders in the dark regarding an expected loss from building ships for the US Navy.
ASIC has taken action against Austal about a material change to its earnings forecasts from 2015 to 2016. This allegation related to the company building vessels for the US Navy at its shipyard in Mobile, Alabama.
The proceedings allege that Austral was aware of the loss as early as June 4, 2016, and needed to report material to write back. However, Austal didn’t make the announcement until a month later on July 4, 2016.
From this, ASIC believe Austal failed to immediately report a material change in its prior earnings guidance.
Proceedings allege Mr Singleton was involved in the company’s breach of its continuous disclosure obligations and failed to discharge his duty.
“Austal will consider the documentation provided by ASIC before deciding its next steps,” the company said.
On the market, Austal is down 0.22 per cent and is trading at $2.32 per share at 11:38 am AEST.
