What’s happening at Downer (ASX:DOW) post ‘accounting irregularities’ announcement?

December 13, 2022 01:09 PM AEDT | By Sonal Goyal
Follow us on Google News:


  • Downer EDI reported certain irregularities in its Australian utilities business recently.
  • The group said that it expects environmental disruptions to impact its financial performance of 2023.

Shares of Australian integrated services provider Downer EDI Limited (ASX:DOW) has declined by 18.96% in the last five trading sessions. It is likely that share price performance is driven by the update shared on ASX on 8 December 2022.

The company reported certain accounting irregularities in its utility business that involved historical misreporting of work in progress and revenue in one of the maintenance contracts. As reported, the investigation has commenced, and adjustments seem to be related to September 2019 and November 2022.

Downer said that these irregularities are expected to result in an

On 12 December 2022, Downer EDI informed ASX that it did not reveal the irregularities as soon as it came to their notice because, at that time, the information was comprised of supposition, confidential and insufficiently definite.

The company added that it was difficult to assess the amount of overstated work in progress because of those work orders which were not completed.

What else?

In August, Downer EDI said it expects 10 to 20% growth in its underlying NPATA for FY23 under the assumption that labour shortage, weather and Covid-19 or any disruption would impact the performance.

Recently, Grant Fee, CEO, Downer EDI, confirmed that elevated costs and weather conditions had affected the first quarter performance, especially in New Zealand and the Eastern States of Australia. Based on October and November analysis, the company said that it is clear that it is unlikely that guidance will be met.

Fenn commented on the trading update,

Share price snapshot of Downer EDI

At 12:33 PM AEDT, Downer EDI shares were spotted trading 4.85% higher at AU$3.89 per share with a market capitalisation of AU$2.49 billion. In the past one year, the share price has dropped by 34.07%, and on a year-to-date basis, it has tumbled by 36.33%.


The content, including but not limited to any articles, news, quotes, information, data, text, reports, ratings, opinions, images, photos, graphics, graphs, charts, animations and video (Content) is a service of Kalkine Media Pty Ltd (Kalkine Media, we or us), ACN 629 651 672 and is available for personal and non-commercial use only. The principal purpose of the Content is to educate and inform. The Content does not contain or imply any recommendation or opinion intended to influence your financial decisions and must not be relied upon by you as such. Some of the Content on this website may be sponsored/non-sponsored, as applicable, but is NOT a solicitation or recommendation to buy, sell or hold the stocks of the company(s) or engage in any investment activity under discussion. Kalkine Media is neither licensed nor qualified to provide investment advice through this platform. Users should make their own enquiries about any investments and Kalkine Media strongly suggests the users to seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice), as necessary. Kalkine Media hereby disclaims any and all the liabilities to any user for any direct, indirect, implied, punitive, special, incidental or other consequential damages arising from any use of the Content on this website, which is provided without warranties. The views expressed in the Content by the guests, if any, are their own and do not necessarily represent the views or opinions of Kalkine Media. Some of the images/music that may be used on this website are copyright to their respective owner(s). Kalkine Media does not claim ownership of any of the pictures displayed/music used on this website unless stated otherwise. The images/music that may be used on this website are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated as or found to be necessary.

We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK