Vocus Group Served with a Class action Proceeding Filed in the Federal Court of Australia

  • Apr 30, 2019 AEST
  • Team Kalkine
Vocus Group Served with a Class action Proceeding Filed in the Federal Court of Australia

Specialist fibre network services provider, Vocus Group Limited (ASX: VOC) has today acknowledged a class action proceeding which has been filed in the Federal Court of Australia by Slater & Gordon.

The company currently operates in increasingly regulated industries, and its products and services are subject to ongoing industry-wide scrutiny from a range of regulators and agencies. Moreover, there are significant penalties for non-compliance with regulations, including fines and undertakings that may include customer redress and restrictions on future marketing of services.

In an announcement made on 30 April 2019, the company announced that it has been served with a class action proceeding filed in the Federal Court of Australia by Slater & Gordon, on behalf of persons who acquired an interest in the company’s shares from 29 November 2016 to the close of trade on 2 May 2017.

Slater & Gordon has put allegations of misleading on the company in respect of the company’s FY17 earnings guidance.

The Company’s future growth prospects are heavily reliant on its ability to market its services through its various sales channels. Any regulatory change, event or enforcement action which would restrict those activities could have a material adverse impact on the Company’s growth and future financial performance.

Besides regulatory and environmental risks, the company also face technological risk. The telecommunications and IT industries are continually evolving as are consumer behaviour and attitudes towards the use of technology. The ability of the Company to keep pace with changes in technology will dictate its ability to maintain and grow its existing market share and margins into the future.

The ability to deliver the company’s planned product and platform integration and consolidation is a key risk to the Company. Migration to the Company’s future Technology architectural state will deliver improved resilience and a better customer experience.

In the first half of FY 2019, the company reported revenue of $974.2 million, slightly higher than the previous corresponding period (pcp). The revenues were supported by growth in Vocus Networks but offset by declining revenues in Vocus Retail. In FY 2019, the company is expecting its Underlying EBITDA to be in the range of $350m - $370m.

Now, let’s have a glance at the company’s share performance and the return it has posted over the past few months. The stock traded at a price of $3.910, down by 1.511% during the day’s trade with a market capitalisation of ~$2.47 billion as on 30 April 2019. The counter opened the day at $3.820 and reached the day’s high of $3.925 and touched a day’s low of $3.730 with a daily volume of ~ 1,900,540. The stock has provided a year till date return of 29.32% & also posted returns of 20.67%, 19.22% & 7.59% over the past six months, three & one-month period respectively. It had a 52-week high price of $3.990 and touched 52 weeks low of $2.210, with an average volume of ~2,291,418.


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