ComScore continues to struggle with its accounting woes: The audience measurement company’s shares are down 4.7% in mid-day trading after it said that it has a new CFO, lost seven board members, will make a “strategic review,” and — with its financial review “more complex and time-consuming than previously anticipated” — won’t file statements for 2015, 2016, and 2017 until at least March 2018.
The company had previously said the new statements would come at the end of this summer. Its shares were delisted by Nasdaq and now trade over the counter.
“Our entire team has been working extremely hard to complete the restatement and audit process,” Gian Fulgoni says. “We regret the need to extend further the date for filing our restated financials and we share the frustration of our stockholders. However, to ensure the completeness and accuracy of the past four years of financial information we will be reporting and to ensure that we are also able to include audited financial statements for 2017, the Board has determined that additional time is needed.”
He adds that he “firmly” believes in the company’s prospects “based on the compelling opportunities we see for organic growth within our existing and new products,”
But today sees big changes at the top. A Special Committee of the board recommended “a refreshment of the Board and its membership.”
The board now consists of five members with the departures of William Engel, Russell Fradin, Lisa Gersh, Mark Harris, William Henderson, Ronald Korn and Joshua Peirez. ComScores says each “made a determination to depart.”
The remaining members are Fulgoni, President Bill Levek, Jacques Kerrest, Sue Riley, and Brent Rosenthal.
The Special Committee also plans to talk to Starboard Value, which owns 4.9% of comScore, about “near-term issues facing the Company” — as well as a “full financial, operating and strategic review of long term opportunities to maximize value for all stockholders.”
Starboard recently sued comScore to force it to hold an annual meeting, which is hasn’t had for two years. It also said that terms had expired for eight of the 12 board members.
The Special Committee hired King & Spalding to provide legal advice. The company is also being advised by law firm Jones Day, with Goldman Sachs providing financial advice.
On top of all that, comScore says today that CFO and Treasurer David Chemerow left on Friday “to pursue other opportunities.” David Kay of CrossCountry Consulting — which says it specializes in helping companies with “pressing business needs” — stepped in as Interim CFO reporting to Fulgoni.
CrossCountry has already been working with comScore on its financial restatement investigation.
There’s still more: ComScore says it agreed to pay millions in cash and stock to settle several class action suits.
For one, in New York. comScore to offer stockholders $27.2 million — to by paid by insurers — and $82.8 million in comScore stock. The company says it “denies all claims of wrongdoing or liability.”
In another suit, against comScore officers and directors, the company would receive $10 million from its insurer, and adopt what it calls “certain corporate governance and compliance terms that were negotiated by derivative plaintiffs’ counsel and comScore.”