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Yahoo
28-05-2025
- Business
- Yahoo
Compass Diversified Takes Decisive Steps Amid Lugano Probe, Stock Dips
Compass Diversified CODI is taking decisive steps to improve liquidity and minimize costs following the discovery of irregularities in the financing, accounting and inventory practices at its subsidiary, Lugano Holding Inc. ('Lugano'). Following the news announcement, CODI shares fell 10.2% after trading hours. To strengthen financial flexibility and sharpen focus on its core portfolio, CODI entered a forbearance agreement with its lender group to maintain liquidity and support uninterrupted operations. The company reduced management fees, demonstrating a commitment to cost discipline and operational efficiency. It also temporarily suspended the quarterly cash distribution to common shareholders, preserving cash to protect long-term shareholder value. CODI has restricted further investment in Lugano and is concentrating on its eight other subsidiaries, which it believes are well-positioned for growth. Compass Diversified also addressed the status of its regulatory filings. As expected, following the delayed filing of its first-quarter 2025 Form 10-Q, CODI received a notice from the New York Stock Exchange ('NYSE') on May 20, 2025. Under NYSE rules, CODI has six months from May 19, 2025, to file Form 10-Q with the SEC and regain compliance. An extension of up to six additional months may be granted at the NYSE's discretion, though the NYSE retains the right to initiate delisting proceedings at any point during this period. CODI is continuing its efforts to finalize the internal review at Lugano, complete restatements for 2024 if needed, and submit Form 10-Q as soon as attainable. CODI's management remains confident in effectively addressing the Lugano situation while maintaining the performance of other businesses. These measures are part of a broader strategy to reduce leverage and ensure compliance with debt covenants. Elias Sabo, chief executive of Compass Diversified, informed, 'We are taking decisive action to enhance liquidity, reduce costs, and preserve value for all stakeholders.' 'We are encouraged by the support of our lenders as we take the necessary steps to reduce leverage and restore compliance with our debt covenants,' he added. Mr. Sabo further stated, 'Our structure and diversified business model give us the flexibility to help isolate and ring fence the challenges at Lugano while continuing to support the growth and execution of our healthy businesses. CODI's other eight subsidiaries continue to execute and we believe they are well positioned to grow in their respective markets. As our subsidiaries generate cash, we are focused on quickly deleveraging and ultimately maximizing value for all shareholders.' In the past six months, Compass Diversified's shares have plunged 67.4% compared with the industry's fall of 2.8%. Image Source: Zacks Investment Research Currently, the company carries a Zacks Rank #3 (Hold). Some better-ranked finance stocks are Chicago Mercantile Exchange CME and Cboe Global Markets, Inc. CBOE, each carrying a Zacks Rank #2 (Buy) at present. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. CME earnings estimates for 2025 have been revised upward to $11.15 per share in the past 30 days. Its shares have gained 23.6% over the past six months. CBOE's 2025 earnings estimates have been revised upward to $9.50 per share in the past 30 days. Its shares have gained 7.5% over the past six months. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report CME Group Inc. (CME) : Free Stock Analysis Report Cboe Global Markets, Inc. (CBOE) : Free Stock Analysis Report Compass Diversified Holdings (CODI) : Free Stock Analysis Report This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Business Wire
08-05-2025
- Business
- Business Wire
Compass Diversified (CODI) Plunges 59% as Lugano Unit Probe Reveals Deep Accounting Problems
SAN FRANCISCO--(BUSINESS WIRE)--Compass Diversified (NYSE:CODI), a Westport, Connecticut-based investment firm, saw its stock plunge 59% on Thursday, May 8, after announcing that its 2024 financial statements could no longer be relied upon due to irregularities uncovered at its Lugano Holding subsidiary. Hagens Berman is investigating potential violations of the U.S. securities laws and urges investors who purchased Compass shares and suffered substantial losses to submit your losses now. The firm also encourages persons with knowledge that may assist the firm's investigation to contact its attorneys. Stock Rout Follows Internal Investigation at Lugano Subsidiary: The steep selloff followed the company's disclosure of an ongoing internal investigation into Lugano's financing and accounting practices. The probe, led by outside counsel and a forensic accounting firm, has already identified irregularities in Lugano's inventory and non-Compass financing arrangements. As a result, the company said it would delay filing its first quarter 2025 financial report and restate its 2024 results. Leadership Shake-Up and Corporate Fallout The fallout extended to Lugano's founder and chief executive, Moti Ferder, who resigned from all positions on May 7 and will not receive severance. The probe has already exposed significant irregularities in Lugano's financing and accounting practices, prompting the company to disavow its 2024 financials and acknowledge the need for a comprehensive restatement. 'What has been uncovered through the investigation thus far does not reflect who we are as a business and the values we uphold,' said Elias Sabo, Compass Diversified's chief executive, signaling both the seriousness of the issues at Lugano and the company's attempt to distance itself from the subsidiary's conduct. Hagens Berman's Investigation Hagens Berman, a national investor rights firm, has launched an investigation into potential securities violations by Compass Diversified, scrutinizing the company's disclosures and practices. 'We are carefully reviewing Compass Diversified's recent disclosures and the circumstances surrounding the accounting irregularities at Lugano,' said Reed Kathrein, the Hagens Berman partner leading the investigation. 'Our focus is on whether shareholders were misled and whether the company's disclosures met their obligations under federal securities laws.' Mr. Kathrein, a seasoned litigator in securities and investor fraud cases, has previously led high-profile investigations into corporate governance and financial reporting failures. If you invested in Compass Diversified and have substantial losses, or have knowledge that may assist the firm's investigation, submit your losses now » If you'd like more information and answers to frequently asked questions about the Compass Diversified investigation, read more » Whistleblowers: Persons with non-public information regarding Compass Diversified should consider their options to help in the investigation or take advantage of the SEC Whistleblower program. Under the new program, whistleblowers who provide original information may receive rewards totaling up to 30 percent of any successful recovery made by the SEC. For more information, call Reed Kathrein at 844-916-0895 or email CODI@ Hagens Berman is a global plaintiffs' rights complex litigation firm focusing on corporate accountability. The firm is home to a robust practice and represents investors as well as whistleblowers, workers, consumers and others in cases achieving real results for those harmed by corporate negligence and other wrongdoings. Hagens Berman's team has secured more than $2.9 billion in this area of law. More about the firm and its successes can be found at Follow the firm for updates and news at @ClassActionLaw.
Yahoo
13-02-2025
- Business
- Yahoo
Compass Diversified Announces Fourth Quarter and Full Year 2024 Earnings and Conference Call Information
WESTPORT, Conn., Feb. 13, 2025 (GLOBE NEWSWIRE) -- Compass Diversified (NYSE: CODI) ('CODI' or the 'Company'), an owner of leading middle market businesses, announced today that it plans to release financial results for the fourth quarter and full year ended December 31, 2024, on Thursday, February 27, 2025, after the close of market trading. The Company has scheduled a conference call to discuss the results on Thursday, February 27, 2025, at 5:00 p.m. ET. In conjunction with reporting fourth quarter and full year 2024 results, CODI will host a conference call at 5:00 p.m. ET / 2:00 p.m. PT with the Company's Chief Executive Officer, Elias Sabo, the Company's Chief Financial Officer, Stephen Keller, and Pat Maciariello, the Chief Operating Officer of Compass Group Management. A live webcast of the call will be available on the Investor Relations section of CODI's website. To access the call by phone, please go to this link (registration link) and you will be provided with dial in details. To avoid delays, we encourage participants to dial into the conference call 15 minutes ahead of the scheduled start time. A replay of the webcast will also be available for a limited time on the Company's website. About Compass Diversified Since its IPO in 2006, CODI has consistently executed its strategy of owning and managing a diverse set of highly defensible, middle-market businesses across the industrial, branded consumer and healthcare sectors. The Company leverages its permanent capital base, long-term disciplined approach, and actionable expertise to maintain controlling ownership interests in each of its subsidiaries, maximizing its ability to impact long-term cash flow generation and value creation. The Company provides both debt and equity capital for its subsidiaries, contributing to their financial and operating flexibility. CODI utilizes the cash flows generated by its subsidiaries to invest in the long-term growth of the Company and has consistently generated strong returns through its culture of transparency, alignment and accountability. For more information, please visit Forward Looking Statements This press release may contain certain forward-looking statements, including statements with regard to the expected timing of earnings announcements and the future performance of CODI and its subsidiaries. Words such as "believes," "expects," and "future" or similar expressions, are intended to identify forward-looking statements. These forward-looking statements are subject to the inherent uncertainties in predicting future results and conditions. Certain factors could cause actual results to differ materially from those projected in these forward-looking statements, and some of these factors are enumerated in the risk factor discussion in the Form 10-K filed by CODI with the SEC for the year ended December 31, 2023 and in other filings with the SEC. Except as required by law, CODI undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Investor RelationsCompass Diversifiedirinquiry@ Gateway GroupCody Slach949.574.3860CODI@ Media RelationsCompass Diversified Mediainquiry@ The IGB GroupLeon Berman212.477.8438lberman@ in to access your portfolio
