Nortel Finally Files Q3
The company previously estimated third-quarter revenues of $2.3 billion, and a loss per share of 6 cents (see Nortel Provides Estimates).
Early last month the vendor announced its results for the first two quarters of 2004 (see Nortel's Retro Quarters ). It expects to publish its fourth-quarter 2004 numbers some time in April, and has estimated revenues of $2.8 billion for that period (see Nortel Provides Latest Update).
Analysts are anxious to pore over the details of the second half of 2004, as they say without the full year's details it's hard to judge Nortel's current financial health.
News of the imminent filing sent the firm's share price up by 4 cents to $2.92.
But with the news of the third-quarter filing came detail of the latest class action lawsuit, filed with the Ontario Superior Court of Justice by disgruntled Canadian investors who bought the vendor's shares between April 24, 2003, and April 27, 2004.
On April 28, 2004, Nortel fired its CEO, Frank Dunn, dismissed its CFO and financial controller, who had already been placed on leave of absence, and announced that 2003 profits would likely be halved (see Nortel Fires CEO and Nortel Dismisses Dunn).
The Canadian residents' lawsuit alleges "negligence, misrepresentations, oppressive conduct, insider trading, and violations of Canadian corporation and competition laws in connection with the Company's 2003 financial results." As a result, they want C$3 billion (US$2.5 billion) in damages, plus another C$1 billion (US$832 million) in punitive damages.
Nortel is already facing a class action claim from investors in the U.S., where 27 separate actions were consolidated into one. The company is also still under investigation by the Securities and Exchange Commission (SEC). (See Nortel Sees Light Revenues, Slow Growth.)
The company isn't only on the receiving end of the legal probers. It is suing some of its former executives for the salaries and bonuses they received as a result of the false accounting (see Nortel Sues Former Executives).
Nortel also announced today that the Ontario court has granted it an extension to hold its 2004 annual general meeting (AGM) no later than June 30. The company now plans to hold a combined 2004/2005 AGM "as soon as reasonably possible."
— Ray Le Maistre, International News Editor, Light Reading