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B&M Crashes To 9-Year Lows As Accounting Error Forces Fresh Profit Warning
B&M attributes a £7 million accounting error to an operating system update, contributing to a £40 million full-year profit downgrade amid weaker demand and rising costs.
- On October 20, B&M shares plunged by almost a fifth after a �40m profit downgrade, and Mike Schmidt, chief financial officer, stepped down in a surprise Monday update.
- Following an operating system update earlier this year, B&M said its half-year results consolidation process identified approximately £7 million of overseas freight costs not recognized, and the underlying system issue has since been resolved.
- Group adjusted earnings were revised to a �470m-�520m range and adjusted EBITDA is now expected at �191 million versus �198 million; Jefferies said `Very poor optics for B&M, and an update that erodes trust further, highlighting potential issues in accounting controls and higher-level analytical review/oversight`.
- The Board of B&M has commissioned a comprehensive third-party review and launched a search for Mike Schmidt's successor, with Mr Schmidt remaining until a replacement is appointed.
- Shares are trading at pre-COVID levels as the retailer said it faces weaker demand, a �30 million jump in wage costs, and a �14 million packaging tax hit, according to B&M.
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B&M issues announcement after multimillion pound error - Nottinghamshire Live
The discount chain said the error was connected to an operating system upgrade earlier this year, according to PA. It led to £7million of overseas freight costs being wrongly recorded in their accounts.
·Nottingham, United Kingdom
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Coverage Details
Total News Sources23
Leaning Left3Leaning Right2Center5Last UpdatedBias Distribution50% Center
Bias Distribution
- 50% of the sources are Center
50% Center
L 30%
C 50%
R 20%
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